Consider a group of passive index funds that manage portfolios based on the same index$-$e$.$g$,$ funds based on the S&P $500$ index. What characteristic of these funds will be the best predictor of their future performance?

Expense ratios

Fund turnover

Past performance since inception $($launch date$)$

Tenure of the fund manager

Suppose BAC $($Bank of America$)$ stock has a return of $7\%$ today. BAC stock has betas of $1,-2.$ and $1$on the market, size, and value factors, respectively. Today's excess returns are $2\%,2\%,$ and $1\%$ for market, size, and value factors, respectively. The risk$-$free rate is $2\%.$ What is BAC stock$$s idiosyncratic return today according to the Fama$-$French three$-$factor model? Round to the nearest$1\%.$

$0\%$

$04\%$

$5\%$

$6\%$

None of the above