Explain the Characteristic Line in Excess Return Form for the Jensen

question 25

Essay

Explain the characteristic line in excess return form for the Jensen alpha measure.

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Definitions:

Hetch Hetchy

A valley in Yosemite National Park, controversially dammed in the early 20th century to provide water to San Francisco.

John Muir

An influential Scottish-American naturalist, author, and early advocate for the preservation of wilderness in the United States.

Sierra Club

An environmental organization in the United States dedicated to the conservation of natural environments and the promotion of sustainable energy sources.

World War I

A global conflict that occurred from 1914 to 1918, involving many of the world's nations and marked by significant military innovations and major shifts in political power.