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Can you please help me understand why Liquidity is the correct answer? Higher returns of equity hedge funds as compared to the S&P 5 0

Can you please help me understand why Liquidity is the correct answer?

Higher returns of equity hedge funds as compared to the S&P

500

Index reflect positive compensation for

__________

risk

.

systematic

.

interest rate

.

market

.

liquidity

The correct answer is D

.

Liquidity

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