Excess return = fund increases, index increases. For example, the net fund value rose from 1 to 1.5, an increase of 50%. When the index rises from 1 to 1.3, the increase is 30%, and the excess return is 50%-30%=20%. Excess return =( 1+ fund increase) /( 1+ index increase)-1. Similarly, the excess return is (1+50%)/(1+30%)-1=