Question

Sarah purchased 100 shares of General Electric stock at a price of $51.46 three months ago. She sold all stocks today for $56.12. During the year the stock paid dividends of $2.90 per share. What is Sarah’s holding period return? Round the answers to two decimal places in percentage form.

Answer 1

Solution:
	Holding period return (HPR) = 14.69%
Working Notes:
	Holding period return (HPR) = (Selling price + Dividend per share - Purchase price per share)/Purchase price per share
	Holding period return (HPR) = ($56.12 + $2.90 -$51.46)/$51.46
	Holding period return (HPR) = 7.56/51.46
	Holding period return (HPR) = 0.14691022
	Holding period return (HPR) = 14.691022%
	Holding period return (HPR) = 14.69%
Notes:	Rate of Returns for 100 shares will same as for 1 share
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