) You are an individual investor. Assume that you bought 250 shares of stock X at...
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) You are an individual investor. Assume that you bought 250 shares of stock X at $5 exactly three years ago (1-3) and received $0.75 per share in dividends following two years (1-2 and t-1). The stock X was trading at $6 last year (1-1) and you bought another 250 shares since you were expecting that the price would increase to $7.5 in 1 year (10) today. However, when the price hit $7.2 after 6 months you sold the stock X. a) Calculate the expected return and expected rate of return of 250 shares of stock X you bought last year (1-1). b) Calculate the realized return and realized rate of return of 250 shares of stock X you bought last year (t-1) and sold after six months. c) Calculate the holding period return of 250 shares of stock X you bought last year (t-1) and sold after six months. d) Assuming that you received another $0.75 per share in dividends in year (t0) today from 250 shares of stock X you had bought three years ago (t-3), and you sell all 500 shares of the stock X with $8, calculate the tota amount you will receive and total (amount of) return (profit) you made in 3 years. ) You are an individual investor. Assume that you bought 250 shares of stock X at $5 exactly three years ago (1-3) and received $0.75 per share in dividends following two years (1-2 and t-1). The stock X was trading at $6 last year (1-1) and you bought another 250 shares since you were expecting that the price would increase to $7.5 in 1 year (10) today. However, when the price hit $7.2 after 6 months you sold the stock X. a) Calculate the expected return and expected rate of return of 250 shares of stock X you bought last year (1-1). b) Calculate the realized return and realized rate of return of 250 shares of stock X you bought last year (t-1) and sold after six months. c) Calculate the holding period return of 250 shares of stock X you bought last year (t-1) and sold after six months. d) Assuming that you received another $0.75 per share in dividends in year (t0) today from 250 shares of stock X you had bought three years ago (t-3), and you sell all 500 shares of the stock X with $8, calculate the tota amount you will receive and total (amount of) return (profit) you made in 3 years.
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Answer a To calculate the expected return and expected rate of return for the 250 shares of stock X bought last year t1 we can use the following formu... View the full answer
Related Book For
Financial and Managerial Accounting the basis for business decisions
ISBN: 978-0078111044
16th edition
Authors: Jan Williams, Susan Haka, Mark Bettner, Joseph Carcello
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