Response to the following problem:
An investor buys 2000 shares at $8 per share, using a margin loan to finance 40% of the purchase. The share pays annual dividends of $0.10 per share, and a margin loan can be obtained at an annual interest cost of 8%.
Determine what return on invested capital the investor will realise if the price of the share increases to $10.40 within six months.
What is the annualised rate of return on this transaction?