Question: Another analyst at your firm overhears this conversation and pulls you aside. He tells you of a tradeable index of illiquid foreign bonds very similar

Another analyst at your firm overhears this conversation and pulls you aside. He tells you of a tradeable index of illiquid foreign bonds very similar to the types of securities that the hedge fund manager is trading. What single-factor regression would you use to determine a more precise measure of any abnormal returns on the hedge fund? The monthly return for this new index is denoted rbond (Hint: write the specific equation).

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!