CAPM 1. The Eurekahedge indices are a set of indices that track specific types of hedge funds. In this exercise we want to evaluate and determine the factors that determine the returns generated by EHF1251, an index of long-short hedge fund performance. We will compare this to the Rusell 2000 performing CAPM analysis yielding the following regression chart: EHF1251 y = 0.1748x +0.0032 R=0.5285 6.00% 4.00% 2.00% -25.00% -20.00% -15.00% $10.00% 5.00% 2098% 5.00% 10.00% 15.00% 20.00% -2.00% -4.00% -6.00% EHF1251 Linear (EHF1251) a. What is the Beta for EHFI 251? What does Beta imply here for EHFI 251 if we see a 1% move in the Russell 2000? b. What number do we use to determine the alpha of EHFI 251? What is that number according to the CAPM?|