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Sagot :
a-1. The manager's return in the month, based on the performance table information, is 1.38%.
a-2. The manager's underperformance is 0.51% (1.89 - 1.38).
What is a manager's underperformance?
A manager's underperformance occurs when the manager delivers results below expectation.
For instance, the weighted benchmark return was expected to be 1.89%, but the manager achieved an actual weighted return of 1.38%.
Data and Calculations:
(1) Actual (2) Actual (3) Benchmark (4) Index
Return Weight Weight Return
Equity 2.2% 0.4 0.5 2.7% (S&P 500)
Bonds 1.1 0.2 0.2 1.5 (Barclays Aggregate Bond index)
Cash 0.7 0.4 0.3 0.8
(1) Actual (2) Actual Weighted
Return Weight Returns
Equity 2.2% 0.4 0.88%
Bonds 1.1 0.2 0.22
Cash 0.7 0.4 0.28
Weighted Returns = 1.38%
Benchmark (4) Index Weighted
Weight Return Benchmark
Equity 0.5 2.7% (S&P 500) 1.35% (0.5 x 2.7)
Bonds 0.2 1.5 (Barclays 0.30 (0.2 x 1.5)
Aggregate Bond index)
Cash 0.3 0.8 0.24 (0.3 x 0.8)
Weighted Benchmark Return = 1.89%
Thus, there was a comparative underperformance of 0.51%.
Learn more about management performance indices at https://brainly.com/question/26717041
#SP J1
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