Geometric average return for the period


You have the following rates of return for a risky portfolio for several recent years. Assume that the stock pays no dividends.

Year    Beginning of year price    # shares bought or sold
2005    $50.00                                      100
2006    $55.00                                       50
2007    $51.00                                       75
2008    $54.00                                       75

Problem 1: What is the geometric average return for the period?

Problem 2: What is the dollar weighted return over the entire time period?

Solution Preview :

Prepared by a verified Expert
Finance Basics: Geometric average return for the period
Reference No:- TGS01450109

Now Priced at $20 (50% Discount)

Recommended (97%)

Rated (4.9/5)