Question

Please solve it without using EXCEL.

1. As a financial analyst, you plan to help Arkansas Tech Endowment choose a fund. The risk-free rate of return is 4%. The table below shows a basic statistic summary for two potential funds: Odyssey Growth fund and Vanguard Wellington fund. (20pts) Average Return Standard Deviation Beta Odyssey Growth Vanguard Wellington S&P500 9,40% 18.70% 1 1.20% 21.50% 1.2 10.80% 19.40% 1.3 1) 2) 3) 4) 5) What are the Sharpe ratios for Odyssey Growth fund and Vanguard Wellington fund? (6pts) What are the M2 measures for Odyssey Growth fund and Vanguard Wellington fund? (6pts) What are the Treynor ratios for Odyssey Growth fund and Vanguard Wellington fund? (6pts) What are the Jensen alphas for Odyssey Growth fund and Vanguard Wellington fund? (6pts) If Arkansas Tech Endowment only wants to build a portfolio that includes only one fund, which fund would you choose to add to the portfolio? Explain why. (4pts)

Answer 1

150.335 Vanguard welington fund: logo-49-0.39 Stumpe Ratio for 13.40ゾ. s p = o.lo26 13-4 -o-1055

nen 1 2 Tsay 1aod 1. 3 sst 120 0.220 0022 S) 명 one -fund, we fhould decide attu en R &nould hsoie fれarpe Nanguesd welington fund! because 81es

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