What does the Sortino Ratio primarily focus on in its risk assessment?

Overall return volatility Downside risk or negative returns Positive returns exceeding the benchmark Consistency of returns over time

What is the key difference between the Sharpe Ratio and the Sortino Ratio?

The Sharpe Ratio considers only positive returns, while the Sortino Ratio considers both positive and negative returns The Sortino Ratio uses a risk-free rate of return, while the Sharpe Ratio does not The Sharpe Ratio accounts for downside risk, while the Sortino Ratio considers overall volatility The Sortino Ratio focuses on downside risk, while the Sharpe Ratio considers both positive and negative returns in its risk assessment

What does a downside capture ratio of less than 100 indicate?

The fund outperformed the benchmark during periods of negative returns The fund performed worse than the benchmark during periods of negative returns The fund perfectly mirrored the benchmark's performance during periods of negative returns The fund consistently generated positive returns regardless of market conditions

What is the primary function of capture ratios in mutual fund analysis?

To assess the fund manager's stock-picking abilities To determine the fund's overall profitability To evaluate the fund's performance relative to its benchmark during both positive and negative market periods To predict the fund's future performance based on historical trends

What is considered a desirable characteristic of a mutual fund's capture ratios?

A high upside capture ratio and a high downside capture ratio A low upside capture ratio and a low downside capture ratio A high upside capture ratio and a low downside capture ratio Capture ratios are irrelevant in mutual fund analysis