There are just two risky assets in the market portfolio of a hypothetical economy. The following are the historical retu

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answerhappygod
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There are just two risky assets in the market portfolio of a hypothetical economy. The following are the historical retu

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There are just two risky assets in the market portfolio of a
hypothetical economy. The following are the historical returns from
the two assets in this economy:
Asset 1 Asset 2
7% 2%
1% 4%
13% 8%
4% 12%
10% 5%
2% 3%
-2% 14%
5% 12%
-7% 2%
9% -3%
In addition, there is a risk-free asset that gives a return of
1.7%. Asset 1 and Asset 2 have the same market capitalization.
Calculate the historical Sharpe ratio of the market portfolio over
this sample.
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