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1.Mike and Sarah decide to look at investing in a hedge fund. One fund, called the Hot Shot fund, returned 10% after fees running its

1.Mike and Sarah decide to look at investing in a hedge fund. One fund, called the Hot Shot fund, returned 10% after fees running its portfolio with an average beta delta adjusted net portfolio long position of 90%. The other fund, called Steady Eddy, returned 7% after fees with an average net beta delta adjusted portfolio long position of 50%. The index returned 10%. What financial concept can you use to show that the funds added value that year and which fund fares the best on this metric? Show your calculations.

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