Suppose you manage a portfolio for a non-profit organization…

Suppose you manage a portfolio for a non-profit organization. The portfolio’s current asset allocation is simple: 60% in an equity index fund and 40% in a bond index fund.  You receive a suggestion to add a commodities fund to the portfolio. The endowment portfolio is long-only; that is, it cannot short sell any funds. Beyond that, it does not have any other portfolio constraints. Suppose the objective of the portfolio is to achieve the highest possible Sharpe ratio. Which TWO of the following criteria can help you correctly judge if the commodities fund is worth being included in the portfolio?  

If you would like to select an active mutual fund to combine…

If you would like to select an active mutual fund to combine with a broadly diversified passive index fund to form your optimal risky portfolio, you should select the funds by ________; if you would like to select many actively managed mutual funds but no passive index funds to form your optimal portfolio, you would select the funds by  ________.