You purchased a stock for $18.45 a share using 70 percent margin.You sold the stock seven months later for $19.85 a share.You did not receive any dividend income.What was your holding period percentage return on this investment? Ignore trading costs and margin interest.
A) 8.77 percent
B) 9.12 percent
C) 10.84 percent
D) 11.75 percent
E) 12.13 percent

Question

Quizplus · Accepted Answer

HPR = ($19.85 - $18.45) / ($18.45 × 0.70) = 10.84 percent

You Purchased a Stock for $18