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Finance: Holding period return question

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 Finance: Holding period return question
Mrweb Mrweb01

Student of MBA at gg
Bangalore, Karnataka

Institute: gg
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Join Date: May 2011
Location: Bangalore, Karnataka
Finance: Holding period return question - January 29th, 2012

An investor bought 10 Ellis Industries, Inc., long-term bonds one year ago, when they were first issued by the company. In addition, he bought 200 shares of the company’s common stock at the same time for \$30 per share. He paid \$1000 each for the bonds, and today, the bonds are selling at \$950 each (long-term interest rates have increased slightly over the past year). The bond s have a stated interest rate of 12 percent per year. The investor received an interest payment equaling \$60 per bond six months ago and has just received another \$60 per bond interest payment. Calculate the investor’s per centage holding period return for the one year he has held the bonds.

solution i got is 7% can an expert confirm if its correct

(9500-10000+1200)*100/10000

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 Re: Finance: Holding period return question
Rose Marry

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Re: Finance: Holding period return question - April 19th, 2016

Quote:
 Originally Posted by mrweb01 An investor bought 10 Ellis Industries, Inc., long-term bonds one year ago, when they were first issued by the company. In addition, he bought 200 shares of the company’s common stock at the same time for \$30 per share. He paid \$1000 each for the bonds, and today, the bonds are selling at \$950 each (long-term interest rates have increased slightly over the past year). The bond s have a stated interest rate of 12 percent per year. The investor received an interest payment equaling \$60 per bond six months ago and has just received another \$60 per bond interest payment. Calculate the investor’s per centage holding period return for the one year he has held the bonds. solution i got is 7% can an expert confirm if its correct (9500-10000+1200)*100/10000
Hey friend,

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