You are evaluating a stock mutual fund that is among your employer's 401k fund electives. The fund
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Question:
You are evaluating a stock mutual fund that is among your employer's 401k fund electives. The fund is actively managed and seeks to outperform the S&P 500. Over the past 10 years, the fund returned 10.25% per year and had a beta = 0.8. Over the same period, the S&P 500 returned 10% and the risk-free rate was 3%.
Calculate the fund's CAPM alpha.
Related Book For
Investment Analysis and Portfolio Management
ISBN: 978-1305262997
11th Edition
Authors: Frank K. Reilly, Keith C. Brown, Sanford J. Leeds
Posted Date: