5 Between 2008 and 2017, the returns on Micro fund average 10% a year. In his 2017 discussion of performance, the fund president noted that this was 2.5% a year better than the UK stock market, a result that he attributed to the funds strategy of buying stocks with outstanding management. The following table shows the returns on the market, size factors and the interest rate during this period: Market Risk Return on Return on Book- Interest Year Premium Size Factor to-Market Factor Rate 2008 -38.34 3.26 0.97 1.6 2009 28.26 9.28 -9.14 0.1 2010 17.37 13.77 -5.17 0.12 2011 0.44 -6.04 -8.41 0.04 2012 16.28 -1.22 9.89 0.06 2013 35.2 7.35 1.54 0.02 2014 11.7 -7.75 -1.65 0.02 2015 0.07 -3.73 -9.48 0.02 2016 13.3 6.66 23.33 0.2 2017 21.5 -4.85 -13.85 0.8 Micro fund sensitivity: Mkt 0.9 SMB 1.4 HML -0.4 a) Calculate Micro funds expected returns according to the Fama-French factors. b) Evaluate the performance of the fund during this period. [8 marks] [7 marks]