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Assume that the economy has three types of people. 20% are fadfollowers, 70% are passive investors, and 10% are informed traders.The portfolio consisting of all informed traders has a beta of 1.2and an alpha of 4.55%. The market has an expected return of 9% andthe risk-free rate is 3%. What is the alpha for the fad followers?Enter your answer as a percentage to two decimal places (i.e. 0.12%rather than 0.0012; the percent sign is not necessary).
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