Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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XYZ stock price and dividend history are as follows:
Dividend Paid at
Year-End
Year
2018
2019
2020
2021
Beginning-of-
Year Price
$ 120
129
115
120
An investor buys six shares of XYZ at the beginning of 2018, buys another two shares at the beginning of 2019, sells one share at the
beginning of 2020, and sells all seven remaining shares at the beginning of 2021.
Required:
a. What are the arithmetic and geometric average time-weighted rates of return for the investor? (Do not round intermediate
calculations. Round your answers to 2 decimal places.)
Arithmetic time-weighted average returns
Geometric time-weighted average returns
%
[%
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Transcribed Image Text:XYZ stock price and dividend history are as follows: Dividend Paid at Year-End Year 2018 2019 2020 2021 Beginning-of- Year Price $ 120 129 115 120 An investor buys six shares of XYZ at the beginning of 2018, buys another two shares at the beginning of 2019, sells one share at the beginning of 2020, and sells all seven remaining shares at the beginning of 2021. Required: a. What are the arithmetic and geometric average time-weighted rates of return for the investor? (Do not round intermediate calculations. Round your answers to 2 decimal places.) Arithmetic time-weighted average returns Geometric time-weighted average returns % [%
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