HPR annual percentage rate

Business & Finance
Tutor: None Selected Time limit: 1 Day

John purchased 100 shares of Black Forest Inc. stock at a price of  $158.37 three months ago. He sold all stocks today for  $157.23. During this period the stock paid dividends of  $5.23 per share. What is John’s annualized holding period return (annual percentage rate)?

Professor came up with 10.33%. I just want to know how she came up with this answer. Thanks

Oct 3rd, 2015

Thank you for the opportunity to help you with your question!

the gain is dividend plus the difference in the prices

so the gain is (157.23-158.37+5.23) = 4.09

the return is 4.09/158.37*(12/3) =  10.33%

12 is for12 month a year. 

Please let me know if you need any clarification. I'm always happy to answer your questions.
Sep 20th, 2015

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