Dollar cost averaging - real Wal*Mart example (from a few years ago) You have decided to invest in Wal*Mart stock for an entire year. The stock paid a quarterly divident of $0.30 per share You paid a 2% commission on the purchase of the stock. You invest $150 per month Month WM Stock Price Jan $54.54 Feb $54.30 Mar $53.43 Apr $54.07 May $55.91 Jun $53.64 Jul $50.56 Aug $48.07 Sep $51.19 Oct $51.00 Nov $53.52 Dec $54.00 As you can see, the stock was down about 1% for the year. What was your individual return? Were you better or worse than the market?
Dollar cost averaging - real Wal*Mart example (from a few years ago) You have decided to invest in Wal*Mart stock for an entire year. The stock paid a quarterly divident of $0.30 per share You paid a 2% commission on the purchase of the stock. You invest $150 per month Month WM Stock Price Jan $54.54 Feb $54.30 Mar $53.43 Apr $54.07 May $55.91 Jun $53.64 Jul $50.56 Aug $48.07 Sep $51.19 Oct $51.00 Nov $53.52 Dec $54.00 As you can see, the stock was down about 1% for the year. What was your individual return? Were you better or worse than the market?
Pfin (with Mindtap, 1 Term Printed Access Card) (mindtap Course List)
7th Edition
ISBN:9780357033609
Author:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk
Publisher:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk
Chapter12: Investing In Stocks And Bonds
Section: Chapter Questions
Problem 2FPE: An investor is thinking about buying some shares of Health Diagnostics, Inc., at $75 a share. She...
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| . Dollar cost averaging - real Wal*Mart example (from a few years ago) | ||||||||||||
| You have decided to invest in Wal*Mart stock for an entire year. The stock paid a quarterly divident of $0.30 per share | ||||||||||||
| You paid a 2% commission on the purchase of the stock. | ||||||||||||
| You invest $150 per month | ||||||||||||
| Month | WM Stock Price | |||||||||||
| Jan | $54.54 | |||||||||||
| Feb | $54.30 | |||||||||||
| Mar | $53.43 | |||||||||||
| Apr | $54.07 | |||||||||||
| May | $55.91 | |||||||||||
| Jun | $53.64 | |||||||||||
| Jul | $50.56 | |||||||||||
| Aug | $48.07 | |||||||||||
| Sep | $51.19 | |||||||||||
| Oct | $51.00 | |||||||||||
| Nov | $53.52 | |||||||||||
| Dec | $54.00 | |||||||||||
| As you can see, the stock was down about 1% for the year. | ||||||||||||
| What was your individual return? | ||||||||||||
| Were you better or worse than the market? | ||||||||||||
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| Robert bought shares of 6% $100 face value at a price of $120. Sam bought shares of 8% $20 face value at $30. Whose investment was better? | |||||||||||||
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