Question

# You invested in the​ no-load OhYes Mutual Fund one year ago by purchasing 700 shares of...

You invested in the​ no-load OhYes Mutual Fund one year ago by purchasing 700 shares of the fund at the net asset value of ​\$25.46 per share. The fund distributed dividends of ​\$2.67 and capital gains of ​\$2.12. ​Today, the NAV is ​\$27.15. What was your holding period​ return?

Your holding period return was _​%.

Solution :

The formula for calculating the holding period return of mutual fund is

= ( Closing NAV + Capital gain per share + Dividend per share – Opening NAV ) / Opening NAV

As per the information given in the question we have:

Closing NAV = \$ 27.15   ;    Opening NAV = \$ 25.46   ;

Capital gain per share = \$ 2.12   ; Dividend per share = \$ 2.67   ;

Applying the above values in the formula we have

= ( \$ 27.15 + \$ 2.12 + \$ 2.67 - \$ 25.46 ) / \$ 25.46

= \$ 6.48 / \$ 25.46

= 0.254517

= 25.4517 %

= 25.45 % ( when rounded off to two decimal places )

Thus the holding period return was = 25.45 %

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