What does it mean if a domestic mutual fund has a beta coefficient of 1.25, an alpha coefficient of 2.25 and an R-Square of 75? Explain each measurement and then interpret what these measurements mean for this mutual.
Alpha can be defined as the excess return of the investment in reference to the return of the benchmark index. It also represents the value that a portfolio manager adds or subtracts from a portfolio's return. A positive value of alpha indicates the fund has outperformed its ...
Solution interprets the given mutual fund measures.