For Exercises 10.1 and 10.2, see page 488; for 10.3 and 10.4, see page 490; for 10.5, see pages 493–494; for 10.6 to 10.8, see pages 498–499; for 10.9 and 10.10, see page 500; and for 10.11 and 10.12, see page 502.
10.9 Hot funds?
Explain carefully to a naive investor why the mutual funds that had the highest returns this year will as a group probably do less well relative to other funds next year.
10.9
The mutual funds that had the highest returns this year were high in part because they did well but also in part because they were lucky, so we might expect them to do well again next year but probably not as well as this year.