The following information relates to the performance of a manager in 2020.Benchmark weightReturn on the benchmarkActual returnActual Weight7.28%EquityBondsCash0.60.56.00%3.20%0.90%0.20.20.30.23.60%0.90%Details of investments in different sectors of the equity market are as follows:Beginning of month weights S&P 500 Sector returnSectorBasic materialBusiness servicesCapital goodsConsumer cyclicalConsumer non-cyclical| Credit sensitive1.966.306.95.807.107.01.918.804.18.4712.508.840.3719.4010.024.0120.805.013.20EnergyTechnology13.532.63.9511.900.6 Using the above data, answer the following questions:a. Has the manager over-performed or under-performed?b. What was the contribution of security selection to relative performance?c. What was the contribution of asset allocation to relative performance?d. What was the contribution from sector allocation to security selection?e. Confirm that the sum of contribution of security selection, sector selection and asset allocation isequal manager's total excess return in relation to the bogey.

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Using the above data, answer the following questions: a. Has the manager over-performed or under-performed? b. What was the contribution of security selection to relative performance? c. What was the contribution of asset allocation to relative performance? d. What was the contribution from sector allocation to security selection? e. Confirm that the sum of contribution of security selection, sector selection and asset allocation is equal manager's total excess return in relation to the bogey.

Using the above data, answer the following questions: a. Has the manager over-performed or under-performed? b. What was the contribution of security selection to relative performance? c. What was the contribution of asset allocation to relative performance? d. What was the contribution from sector allocation to security selection? e. Confirm that the sum of contribution of security selection, sector selection and asset allocation is equal manager's total excess return in relation to the bogey.

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter10: Stockholder's Equity

Section: Chapter Questions

Problem 88PSA: Ratio Analysis Consider the following information taken from the stockholders equity section: How do...

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The following information relates to the performance of a manager in August 2020. Benchmark Return on the Actual return Actual Weight weight 0.7 benchmark 6.00% Equity Bonds 6.50% 0.6 3.40% 0.2 0.1 3.60% Cash 0.90% 0.2 0.2 0.90% Using the above data, answer the following questions: Has the manager over-performed or under-performed? b. What was the contribution of security selection to relative performance? What was the contribution of asset allocation to relative performance? d. Confirm that the sum of contribution of security selection to relative performance and contribution of asset allocation to relative performance equal manager's total excess return in а. с. relation to the bogev,
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