- CFA Exams
- CFA Level I Exam
- Study Session 15. Fixed Income (2)
- Reading 46. Understanding Fixed-Income Risk and Return
- Subject 7. Interest Rate Risk and the Investment Horizon

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**CFA Practice Question**

1,000 shares of XYZ were purchased for $30,000. After 5 years, the shares were sold for $50,000 (no dividends). This investment has ______.

A. HPR = 166.7%

B. HPR = 66.67%

C. HPR = 13.33%

**Explanation:**HPR is the factor by which the initial investment has increased.

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**User Contributed Comments**
3

User |
Comment |
---|---|

azramirza |
Holding period return: (50000 - 30000)/30000 = 66.67%. C is the annualized return but the question is asking the total holding period return! |

maria15 |
Thanks azramirza |

davideme20 |
Holding Period Return is defined as "the percentage change in the value of an investment". |