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The FI Corporations dividends are expected to grow indefinitely by 5% per year, and its required rate of return is 10% per year. Assume that

The FI Corporations dividends are expected to grow indefinitely by 5% per year, and its required rate of return is 10% per year. Assume that FI stocks market price is equal to this intrinsic value. If I buy the FI stock now, hold it for a year, and sell it at the year-end. What is my holding period return for this year?

  1. More than 10%
  2. Less than 10%
  3. Exactly 10%
  4. Not enough information to tell.

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