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Suppose it is your job to monitor the water quality at the local beach and to determine whether it contains high levels of certain bacteria. If there were high levels of bacteria the water may not be safe to swim in. However, the beach is very large and it is not possible to monitor the entire swimmable area of the beach.
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Consider the returns of the MSCI index of developed markets equity in column C of the Excel file that goes with this quiz. Given the returns over the 1988-2013 period, and the arithmetic mean return and volatility you calculated in the first quiz (which you could also recalculate now if necessary), what has been the ‘quick-and-dirty’ risk-adjusted return of these markets?
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The first GIS was created to help with the land inventory of which country?
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