Suppose Two Portfolios Have the Same Average Return and the Same

question 61

Multiple Choice

Suppose two portfolios have the same average return and the same standard deviation of returns, but Aggie Fund has a higher beta than Raider Fund. According to the Sharpe measure, the performance of Aggie Fund

• A) is better than the performance of Raider Fund.
• B) is the same as the performance of Raider Fund.
• C) is poorer than the performance of Raider Fund.
• D) cannot be measured as there are no data on the alpha of the portfolio.
• E) None of the options

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Definitions:

Negative Reinforcer

A stimulus whose removal following a behavior increases the likelihood of that behavior being repeated in the future.

Unconditioned Stimulus

A stimulus that innately provokes a response without the necessity for previous learning.

Continuous Reinforcement

A learning schedule in which a reward is given after every correct response, rapidly establishing a behavior but also leading to quick extinction if rewards stop.

Target Response

A desired behavior or outcome that is identified for reinforcement in order to increase its occurrence, often used in behavior modification techniques.