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PLEASE ANSWER ALL THE QUESTIONS CORRECTLY AND LABEL THE ANSWERS WITH THE CORRESPONDING QUESTION. THIS IS MY LAST ATTEMPT

Each month for the past several years, you have collected the monthly returns to an index of large-cap value stocks and an index of large-cap growth stocks. For the fast two years, for both of the indexes you have converted these monthly returns into a series of roling average annualited retums by taking an average of the previous 12 monthiy returns and multiplying that average by 12. These rolling average annualized retums are shown below for each inder over the past 24 months: a. For both the value and growth indexes, caiculate the arithmetic mean of the 24 monthly average annualized retums. Which index appears to have outperfocmed the other over this period? Explain. Do not reund intermediate calculations. Round your answers to two decimal piaces: The Value Indext The Grewth Indext The appears to have outpertormed the over the 24 -manth period by b. For each month in this sample perigd, compute the difference in annualized retums between the value index and the growih inder (Resi.e - Ruruen). Caiculate the average of this retum offerential series and compare it to yeur answers from part (a), Do not round intermediate caiculations. Round your answers to teo decime places. Negative values, if any, should be indicates by a minus signi. If your answer is zero, enter 0 . The average of the return in the differential series is the difference in the antheneck mearms c. Choose the correct graph of the rehurn differential seriss. The average of the return in the differential series is the difference in the arithmetic means. C. Choose the correct graph of the return differential series. A Rotation of Value and Growth Returns Rotation of Value and Growth Returns Rotation of Value and Growth Returns Rotation of Value and Growth Returns The correct graph is d. The average retum differential from part (b) is one way of calculating the risk premium associated with a value investment foctoc interpret this fisk premium statistic. and explain how it can be seen as the average annualized return earned by a hedge fund following a strategy to go long in value stocks and short in groweh stocks. Do not round intermediate calculations. Round your answers to two decimal places. Negative values, if any, should be indicated by a minus sign. A hedge fund that was following a strategy to go long in value stocks and short in growth stocks would quite profitable. The hedge fund would have the average annualized return in the Value Index of Q. thus it the additional risk premium of e. Compute the percentage of the months in the two-year sample period when the rolling average annualized return to the growth index was actually larger than that for the value index. Do not round intermediate calculatiens. Round your answers to two decimal places. What, if anything, ees this teil you about the reliability of the value riak premium over time? This means that the value risk premium of W was reliable for over % of the time in the period studied

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