Eastern States Mutual Fund sold $85 million of assets during the year and purchased $92 million of new assets. The average daily assets of the fund were $340 million. What is the fund's turnover rate for the year?

Question

Quizplus · Accepted Answer

The turnover rate is calculated by dividing the lesser of purchases or sales by the average daily assets. Here, the lesser amount is $85 million (sales), and the average daily assets are $340 million. So, the turnover rate is $85 million / $340 million = 0.25.

Eastern States Mutual Fund Sold $85 Million of Assets During