You bought a stock one year ago for $51.02 per share and sold it today for $57.51 per share. It paid a $1.49 per share dividend today.
a. What was your realized return?
b. How much of the return came from dividend yield and how much came from capital gain?
a) Calculation of realized return:
Realized return= (selling price-purchase price+dividend)/purchase price*100
Realized return= (57.51-51.02+1.49)/51.02*100= 15.64
Realized return= 15.64%
b) calculation of return from dividend yield:
Return from dividend yield= Dividend/purchase price*100
Return from dividend yield= 1.49/51.02*100= 2.92%
Calculation of return from capital gain yield:
Return= (selling price-purchase price) purchase price*100
Return= (57.51-51.02)/51.02*100= 12.72%
Get Answers For Free
Most questions answered within 1 hours.