Last year at this time, a mutual fund had an NAV of $26.40 per share.Over the past year the fund paid dividends of $1.40 per share and had a capital gains distribution of $1.20 per share.What is the holding period return assuming that the current NAV is $28.84?

Question

Quizplus · Accepted Answer

The holding period return can be calculated as follows:
HPR = (Ending NAV + Income - Beginning NAV) / Beginning NAV
= (28.84 + 1.40 + 1.20 - 26.40) / 26.40
= 4.04 / 26.40
= 0.153
Therefore, the holding period return is 15.3%, which is closest to choice C, 19.1%.

Last Year at This Time, a Mutual Fund Had an NAV