CFA Practice Question

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CFA Practice Question

You buy a stock for $50 and sell it a year later for $60. Your holding period return (Rt) would be closest to ______.

A. 1.20
B. 16.67%
C. 20%
Correct Answer: C

60/50 -1 = 0.20

User Contributed Comments 7

User Comment
gravy Is this right? I thought it was

60-50+0 / 60 = 16.67%

gravy Never mind. I see it should be

65-50+0/ 50 = 20% Thanks
TopCat either...
studyprep Dont forget return could be negative or positive. That is ending value could be lower or greater than the starting value. Also, the denominator is a starting value.
Also if you are a buyer you might receive dividend D. Add it in the total before the division process.
Gooner7 if you miss this question you may want to consider a different occupation
papajeff Gooner - You are too kind.
walterli (60-50)/50
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