Sharpe Ratio of PM’s portfolio

1. When making portfolio manager hiring decisions, why do investors/clients not focus on Sharpe Ratio of PM’s portfolio? Why should PM be evaluated relatively to a benchmark or a peer group with similar strategy?

2. According to CAPM, why would market portfolio be tangency portfolio as well? What might this market portfolio look like, if CAPM is indeed correct? Would we expect S&P500 to be on the efficient frontier or be near the tangency portfolio? What about MSCI global index portfolio?

Don't use plagiarized sources. Get Your Custom Essay on
Sharpe Ratio of PM’s portfolio
Just from $10/Page
Order Essay

3. What are the differences between CAPM and single-factor model? Why there is no alpha in CAPM but an alpha in single-factor model?

4. What are Sharpe Ratios of S&P500, Fama-French size and value, and momentum factor portfolio? Why size, value, and momentum should be considered as separate factors, and by holding them can yield better return?

5. If a PM has a -1% Fama-French alpha, would you expect this PM to underperform or outperform the S&P500 on average over time? Please explain carefully.

6. A forecaster notes that the yield curve is steeply upwardly sloping. Comment on the likely monetary and fiscal policies in effect and the future of the economy.

7. Your interviewer is a seasoned PM. During the interview, he/she asked, “We are not using textbook Markowitz MVO in our portfolio, so our portfolio will not be on the textbook efficient frontier. Why are we so ‘dumb’ to leave money on the table?” What will be your answer?

8. When combining two investment portfolios with high Sharpe Ratios, would the resulting portfolio also have a high Sharpe Ratio? How about combining two investment strategies with high information ratios relative to S&P500 benchmark? Would the resulting portfolio have a higher IR? Please use examples or derive carefully your explanation.

9. A market-cap weighted index is considered the most representative of market conditions, especially when it is adjusted for free float. Some practitioners, however, have suggested moving away from this weighting scheme to one based on fundamentals such as sales, cash flow, dividends, etc. Why doing so might outperform market-cap weighted index?

Order a unique copy of this paper
(550 words)

Approximate price: $22

Basic features
  • Free title page and bibliography
  • Unlimited revisions
  • Plagiarism-free guarantee
  • Money-back guarantee
  • 24/7 support
On-demand options
  • Writer’s samples
  • Part-by-part delivery
  • Overnight delivery
  • Copies of used sources
  • Expert Proofreading
Paper format
  • 275 words per page
  • 12 pt Arial/Times New Roman
  • Double line spacing
  • Any citation style (APA, MLA, Chicago/Turabian, Harvard)

Our guarantees

We value our customers and so we ensure that what we do is 100% original..
With us you are guaranteed of quality work done by our qualified experts.Your information and everything that you do with us is kept completely confidential.

Money-back guarantee

You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.

Read more

Zero-plagiarism guarantee

The Product ordered is guaranteed to be original. Orders are checked by the most advanced anti-plagiarism software in the market to assure that the Product is 100% original. The Company has a zero tolerance policy for plagiarism.

Read more

Free-revision policy

The Free Revision policy is a courtesy service that the Company provides to help ensure Customer’s total satisfaction with the completed Order. To receive free revision the Company requires that the Customer provide the request within fourteen (14) days from the first completion date and within a period of thirty (30) days for dissertations.

Read more

Privacy policy

The Company is committed to protect the privacy of the Customer and it will never resell or share any of Customer’s personal information, including credit card data, with any third party. All the online transactions are processed through the secure and reliable online payment systems.

Read more

Fair-cooperation guarantee

By placing an order with us, you agree to the service we provide. We will endear to do all that it takes to deliver a comprehensive paper as per your requirements. We also count on your cooperation to ensure that we deliver on this mandate.

Read more

Calculate the price of your order

550 words
We'll send you the first draft for approval by September 11, 2018 at 10:52 AM
Total price:
$26
The price is based on these factors:
Academic level
Number of pages
Urgency
Open chat
1
You can contact our live agent via WhatsApp! Via +1 817 953 0426

Feel free to ask questions, clarifications, or discounts available when placing an order.

Order your essay today and save 30% with the discount code STARS