The table presents the actual return of each sector of the manager's portfolio in column (1), the fraction of the portfolio allocated to each sector in column (2), the benchmark or neutral sector allocations in column (3), and the returns of sector indexes in column (4). (1) (2) (3) (4) Actual Actual Benchmark Index Return Weight Weight Return Equity 16% 80% 60% 10% Bonds 9% 15% 35% 7% Cash 3% 5% 5% 1% What was the manager's return in the month? What was the benchmark's return in the month? Did the manager over or under perform the benchmark? a. Over perform b. Under perform c. Equal performance d. Cannot tell from the information given e. None of the above By how much did the manager over or under perform the benchmark? What is the contribution of security selection to relative performance? What is the contribution of asset allocation to relative performance?
The table presents the actual return of each sector of the manager's portfolio in column (1), the fraction of the portfolio allocated to each sector in column (2), the benchmark or neutral sector allocations in column (3), and the returns of sector indexes in column (4). (1) (2) (3) (4) Actual Actual Benchmark Index Return Weight Weight Return Equity 16% 80% 60% 10% Bonds 9% 15% 35% 7% Cash 3% 5% 5% 1% What was the manager's return in the month? What was the benchmark's return in the month? Did the manager over or under perform the benchmark? a. Over perform b. Under perform c. Equal performance d. Cannot tell from the information given e. None of the above By how much did the manager over or under perform the benchmark? What is the contribution of security selection to relative performance? What is the contribution of asset allocation to relative performance?
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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Question
The table presents the actual return of each sector of the manager's portfolio in column (1), the fraction of the portfolio allocated to each sector in column (2), the benchmark or neutral sector allocations in column (3), and the returns of sector indexes in column (4).
(1) (2) (3) (4)
Actual Actual Benchmark Index
Return Weight Weight Return
Equity 16% 80% 60% 10%
Bonds 9% 15% 35% 7%
Cash 3% 5% 5% 1%
What was the manager's return in the month?
What was the benchmark's return in the month?
Did the manager over or under perform the benchmark?
a. Over perform
b. Under perform
c. Equal performance
d. Cannot tell from the information given
e. None of the above
By how much did the manager over or under perform the benchmark?
What is the contribution of security selection to relative performance?
What is the contribution of asset allocation to relative performance?
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