The following data are available relating to the performance of Monarch Stock Fund and the market portfolio:
The risk-free return during the sample period was 4%.What is the information ratio measure of performance evaluation for Monarch Stock Fund?
αP = 16% − [4% +1.15(12% − 4%)] = 2.8%; aP/s(eP) = 2.8%/1% = 2.8, or 280%.
View more: Chapter 24 - Portfolio Performance Evaluation
