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3 weeks ago
One common method of evaluating the performance of a mutual fund is to compare its returns to those of a recognized benchmark such as an index of the returns on all securities of the type that  the fund accumulates. The Janus Worldwide Fund considers its benchmark to be the MSCI World IndexSM. The table below depicts the annual returns (percent) for a recent ten-year period. Is this fund a good investment? That is, does this fund significantly outperform its benchmark?

Source: https://ww3.janus.com/advisor/Documents/Advisor%20Lit%20System/Fact%20Sheets/4Q12%20Fact%20Sheet%20(Janus%20Worldwide%20Fund -Class%20A)_exp%2004-15-13.pdf

Explain clearly whether this data should be analyzed using a 2-sample t test approach or a match pairs t-test method.
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Stats: Modeling the World


Edition: 4th
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3 weeks ago
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This analysis should be conducted as a matched pairs t-test since the fund and index performances are not independent. A good year for one is likely to be a good year for the other. For example, the 2008 data depict the first year of the Great Recession and illustrate that the index as well as the fund were hit hard that year.
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