Shown below are the investment weights for the securities held in four different portfolios three mutual funds and the benchmark index that each of those funds uses 8. % Security Investment Weight: Fund Y 40% 0 Fund Z Fund X 12% 13 Benchmark Index 10% 10 10 10 10 10 10 10 10 10 Security 11% 15 4 0 10 30 14 10 a. Calculate the active share (AS) measure for Fund X, Fund Y, and Fund Z relative to the b. Using these active share calculations, indicate which fund is the most likely to be consid- managed concentrated stock-picking fund. Explain the reason for your classification 25 10 benchmark ind ex. ered: (i) a passive index fund, (ii) a closet (or enhanced) index fund, and (iii) an actively

Benchmarks, for instance, might be used to contrast the operations of one retail location with those of another location within the same chain. External benchmarking, also known as competitive benchmarking, evaluates a company's performance in relation to that of other businesses. The word "benchmark," "bench mark," or "survey benchmark" refers to the longitudinal marks that surveyors chiselled into stone buildings so that they could later use an angle-iron to create a "bench" for a levelling rod and ensure that it would remain precisely where it was.

Briefing :

Calculation of Active share measure

Security Benchmark Index

Activity (fund X) Activity (fund Y) Activity (fund Z)

1 10 |10-12|

= 2 |10-40|

= 30 |10-11|

= 1 2 1

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