Question

Suppose money invested in a hedge fund earns 1% per trading day. There are 250 trading days per year. With an initial investment of $100, what will be your annual return assuming the manager puts all of your daily earnings into a zero-interest-bearing checking account and pays you everything earned at the end of the year?

Answer 1

[$100 * (1 + .01)^250] - $100

Answer 2

$100 * .01 * 250

Answer 3

there is no compounding of the daily return...

1st response is not applicable