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Consider the following stocks. Stock Expected return Std. Deviation Beta A 15.9% 27.8% 0.93 B 17.8% 23.0% -1.15 C 35.1% 47.6% 0.79 D 24.2% 39.3% 1.26   If the risk-free rate is 2%, which stock has the lowest Sharpe ratio?

Consider the following stocks. Stock Expected return Std. Deviation Beta A 15.9% 27.8% 0.93 B 17.8% 23.0% -1.15 C 35.1% 47.6% 0.79 D 24.2% 39.3% 1.26   If the risk-free rate is 2%, which stock has the lowest Sharpe ratio?

Essentials Of Investments
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
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Consider the following stocks.

Stock

Expected return

Std. Deviation

Beta

A

15.9%

27.8%

0.93

B

17.8%

23.0%

-1.15

C

35.1%

47.6%

0.79

D

24.2%

39.3%

1.26

 

If the risk-free rate is 2%, which stock has the lowest Sharpe ratio?

   

Stock C
   

Stock B
   

Stock A
   

Stock D
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