1. Calculate the value added by the manager's decisions. 2. Calculate the value added by the manager's country allocation decisions. 3. Calculate the value added from manager's stock selection abilities within countries.
1. Calculate the value added by the manager's decisions. 2. Calculate the value added by the manager's country allocation decisions. 3. Calculate the value added from manager's stock selection abilities within countries.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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1. Calculate the value added by the manager's decisions.
2. Calculate the value added by the manager's country allocation decisions.
3. Calculate the value added from manager's stock selection abilities within countries.
Transcribed Image Text:Intro
An international fund manager is evaluated against the MSCI world index as the benchmark.
The table below provides the results for a given month:
Weight in MSCI Manager's
Return of
Country
Manager's return
index
weight
country Index
U.K.
0.17
0.3
17%
12%
Japan
0.3
0.1
15
15
U.S.
0.48
0.4
12
14
Germany
0.05
0.2
7
12
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