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your retirement account offers the option of investing in treasury bills which yields 5% and one...

your retirement account offers the option of investing in treasury bills which yields 5% and one of these following three diversified mutual funds:

                              expected return standard deviation

fidelity Magellan.          16%                      32%
vanguard s&p 500.        14%                      24%
Barclays internet index. 12%                      15%

1 calculate the Sharpe ration of each mutual fund

2 which mutual fund should you choose? explain

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Answer #1

The Sharpe ratio is a well-known and well-reputed measure of risk-adjusted return on investment, developed by William Sharpe.The Sharpe ratio is a well-known and well-reputed measure of risk-adjusted return on investment, developed by William Sharpe.

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