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Title: You have just read the annual report of a mutual fund. It boasted of a 26% return and advertised ... Post by: GoodMad_ on Dec 1, 2016 You have just read the annual report of a mutual fund. It boasted of a 26% return and advertised that it had beat the market return last year by three percentage points. In doing some research you discover the fund had a beta of +1.5 and the return on risk-free Treasury securities was 15.0%. Assuming a market risk premium of 8.0% should be used to evaluate performance means that
A) the fund's performance was no better than what you would have expected. B) the fund's performance was good, but not impressive; it beat the market, but only by one percentage pointnot three. C) the fund's performance was impressive; three percentage points is significant, given the above data. D) the fund's performance was actually a percentage point less than what you would have expected. Title: Re: You have just read the annual report of a mutual fund. It boasted of a 26% return and advertised ... Post by: imoyse on Dec 1, 2016 Content hidden
Title: Re: You have just read the annual report of a mutual fund. It boasted of a 26% return and advertised ... Post by: GoodMad_ on Jan 12, 2017 I'll mark it solved, you deserve it
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