Asked by Aleksandar Kalenic on Jun 09, 2024
Verified
Assume that you have invested $500,000 to purchase shares in a hedge fund reporting $800 million in assets, $100 million in liabilities, and 70 million shares outstanding. Your initial lockout period is 3 years.
What is your annualized return over the 3-year holding period?
A) 14.45%
B) 15.18%
C) 16%
D) 17.73%
Annualized Return
A rate of return that standardizes an investment's earnings to a one-year period, making comparison with other investments easier.
Holding Period
The length of time an investment is held by an investor before being sold.
- Acquire knowledge on the techniques for calculating returns and appraising hedge fund effectiveness.
Verified Answer
DS
− 1 = 15.18%
Learning Objectives
- Acquire knowledge on the techniques for calculating returns and appraising hedge fund effectiveness.
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