Ross is an equity analyst at green blue fund. ross is comparing returns between PGY, a fintech company, and Vol Au Vent pastries (VOL). He estimates that the Expected market return for the S&P 500 is 12% and today the risk free rate is 2%. PGY has a volatility of 20% and a Beta of 1.6. VOL has a volatiity of 25% and a Beta of 1.2. Based on this information, please choose the only INCORRECT statement.
a.
The expected return of PGY is higher than the exepcted return of VOL because DRY’s beta is higher
b.
The Sharpe ratio of PGY is higher than the Sharpe ratio of VOL
c.
The expected return of PGY is higher because its volatility is higher
d.
PGY is less volatile than VOL
a.
The expected return of PGY is higher than the exepcted return of VOL because DRY’s beta is higher
b.
The Sharpe ratio of PGY is higher than the Sharpe ratio of VOL
c.
The expected return of PGY is higher because its volatility is higher
d.
PGY is less volatile than VOL
