Question

At the beginning of the year, you buy 800 shares in Muleshoe Mutual Fund, which currently...

At the beginning of the year, you buy 800 shares in Muleshoe Mutual Fund, which currently has a NAV of $48.10. The fund has a front-end load of 1.8%. Over the year, the fund distributed capital gains of $1.75 per share and dividend distributions of $1.42. At the end of the year, the NAV was at $54.47 and the offer price was at $55.45.

A. If you sell after one year, what is your HPR?

B. Recalculate your HPR, assuming you bought 800 shares at the beginning of the year, reinvested all your distributions at an average price of $51, and sold your shares at the end of the year.

Homework Answers

Answer #1

A.

Holding period Return =( Ending value + dividend yield + capital capital ) / beginning value

beginning value = 800 * 48.10 + 1.8% * 800*48.10 = 39172.64

Capital gains = 800 * 1.75 = 1400

dividend = 800 * 1.42 = 1136

Ending NAV = 55.47*800 = 44376

HPR = ( 44376 + 1136 + 1400 ) / 39172.64 - 1 = 19.76%

B.

No of shares purchased from dividends = 1136 / 51*1.018 = 21.88

no of shares purchases from capital gains = 1400 / 51*1.018 = 26.97

Total extra investmnet done = 21.88 + 26.97 = 48.85

Ending value 49.73 shares = 48.85*54.47 = 2660.66

HPR = (44376 + 2660.66 ) / 39172.64 = 20.08%

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
You invested in the? no-load OhYes Mutual Fund one year ago by purchasing 600 shares of...
You invested in the? no-load OhYes Mutual Fund one year ago by purchasing 600 shares of the fund at the net asset value of ?$ 24.51 per share. The fund distributed dividends of ?$2.11 and capital gains of ?$1.58. ?Today, the NAV is ?$26.20. If OhYes was a load fund with a 3.5?% ?front-end load, what would be the? HPR?
1.You invested in the​ no-load OhYes Mutual Fund one year ago by purchasing 800 shares of...
1.You invested in the​ no-load OhYes Mutual Fund one year ago by purchasing 800 shares of the fund at the net asset value of ​$25.75 per share. The fund distributed dividends of ​$1.81 and capital gains of ​$1.64. ​Today, the NAV is ​$26.84. If OhYes was a load fund with a 2​% ​front-end load, what would be the​ HPR? 2.One year​ ago, Super Star​ Closed-End Fund had a NAV of​$10.38 and was selling at​ a(n) 16% discount.​ Today, its NAV...
A year​ ago, the Really Big Growth Fund was being quoted at an NAV of ​$21.63...
A year​ ago, the Really Big Growth Fund was being quoted at an NAV of ​$21.63 and an offer price of ​$22.77. ​Today, it's being quoted at ​$23.56 ​(NAV) and ​$24.80 ​(offer). What is the holding period return on this load​ fund, given that it was purchased a year ago and that its dividends and capital gains distributions over the year have totaled ​$1.38 per​ share? Assume that none of the dividends and capital gains distributions are reinvested into the...
A year​ ago, an investor bought 400 shares of a mutual fund at ​$8.51 per share....
A year​ ago, an investor bought 400 shares of a mutual fund at ​$8.51 per share. Over the past​ year, the fund has paid dividends of ​$0.83 per share and had a capital gains distribution of ​$0.69 per share. a. Find the​ investor's holding period​ return, given that this​ no-load fund now has a net asset value of ​$9.28. b. Find the holding period​ return, assuming all the dividends and capital gains distributions are reinvested into additional shares of the...
A year​ ago, an investor bought 600 shares of a mutual fund at ​$8.56 per share....
A year​ ago, an investor bought 600 shares of a mutual fund at ​$8.56 per share. Over the past​ year, the fund has paid dividends of ​$0.89 per share and had a capital gains distribution of ​$0.65 per share. a. Find the​ investor's holding period​ return, given that this​ no-load fund now has a net asset value of ​$9.11. ( answer in % and 2 decimal places) b. Find the holding period​ return, assuming all the dividends and capital gains...
A. You have $21,000 to invest. You could purchase shares in one mutual fund or try...
A. You have $21,000 to invest. You could purchase shares in one mutual fund or try to diversify on your own. From your investment class you learn that you need to hold at least 25 different securities in an equal weighted portfolio to achieve a reasonably well diversified portfolio. If you pay an average commission of 3% of the dollar value of the stock you buy you will have to pay ______ in commissions per stock for a total commission...
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 _​%. ​
You purchased shares of a mutual fund at a price of $20 per share at the...
You purchased shares of a mutual fund at a price of $20 per share at the beginning of the year and paid a front-end load of 6.0%. If the securities in which the fund invested increased in value by 10% during the year, and the fund's expense ratio was 1.5%, your return if you sold the fund at the end of the year would be a. 1.99% b. 2.32% c. 1.65% d. 2.06% e. None of the options are correct
A year ago, the Vanguard Consumer Staples Index Fund (VCSAX) was being quoted at a NAV...
A year ago, the Vanguard Consumer Staples Index Fund (VCSAX) was being quoted at a NAV of $51.02 and an offer price of $55.76. Today, it’s being quoted at a NAV of $62.36 and an offer of $65.54. What is the percent holding period return on this front-load fund, given that it was purchased a year ago and that its dividends and capital gains distributions over the year have totaled $0.03 per share?
64. You purchased shares of a mutual fund at a price of $20 per share at...
64. You purchased shares of a mutual fund at a price of $20 per share at the beginning of the year and paid a front-end load of 5.75%. If the securities in which the fund invested increased in value by 11% during the year, and the fund's expense ratio was 1.25%, your return if you sold the fund at the end of the year would be A. 4.33%. B. 3.44%. C. 2.45%. D. 6.87%. {[$20 × 0.9425 × (1.11 –...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT