Comparing the short-term and long-term returns

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A mutual fund portfolio manager's performance is evaluated by comparing the short-term and long-term returns to specific benchmarks. When you look at a performance review in Morningstar (one of the most recognized rating service companies) you would find several rating benchmarks. Two of the most widely used measurements are the Sharpe Ratio and the Alpha Coefficient. Briefly describe each and then identify how they are used to evaluate performance.

Reference no: EM13154342

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