The ex-post Sharpe ratio is computed using
Aforecast returns
Banalyst targets
Coption prices
Drealised returns
Answer & Solution
Correct answer: D. realised returns
It uses the same formula as the ex-ante version but with realised rather than expected returns.
Keep practising Modern Portfolio Theory
Browse all Modern Portfolio Theory questions for CA Final, or explore more Strategicfinancialmanagement topics.
Related questions
Investors who want higher expected returns in MPT must acceptThe risk-free rate is 6%, the market return 12% and a stock has expected return 10% with bWhich statement best describes MPT's idea of diversification?In CAPM, the beta used for pricing mainly capturesThe t-statistic of the Sharpe ratio equals the ratio times the square root ofBerkshire Hathaway's Sharpe ratio for 1976 to 2017 was reported asThe Sharpe ratio can be manipulated when a fund holds illiquid assets because ofWhich economist in 1952 suggested maximising (m - d) divided by sigma, where d is a disast