Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

A mutual fund earned an average annual return of 10.0% over the last 5 years. During that time, the average risk-free rate was 0.7% and

A mutual fund earned an average annual return of 10.0% over the last 5 years. During that time, the average risk-free rate was 0.7% and the average market return was 7.1%. If the fund has beta of 0.87, what was its annual alpha? Answer in percent, rounded to two decimal places. (e.g., 4.32% = 4.32)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Money How The Destruction Of The Dollar Threatens The Global Economy And What We Can Do About It

Authors: Steve Forbes, Elizabeth Ames

1st Edition

0071823700,0071823719

More Books

Students also viewed these Finance questions

Question

How did you go about it?

Answered: 1 week ago