Download the data with the Eurekahedge Hedge Fund Index and its returns from here.

This index shows the equally weighted performance of about 2700 hedge funds. It gives a good idea of the overall performance of hedge funds.

The Excel file contains calculations for the average monthly returns and standard deviation of monthly returns over the entire data period (December 1999 - December 2024).

It also has calculations for annual returns and standard deviation. 

• To calculate annual return from monthly returns, we add 1 to the average monthly return, raise the result to the 12th power, and then subtract 1.
• To calculate the annual standard deviation, we multiply the monthly standard deviation by the square root of 12 to scale the monthly volatility to a yearly level.

Using the data and template, calculate the risk-adjusted return (ratio between annual return and annual standard deviation: return/risk) for the last 5 years of the data (last 60 months).