Skip to content

NISM Certifications · NISM-Series-XV: Research Analyst · Fundamentals of Risk and Return

A share was bought at ₹200. During the year it paid a dividend of ₹8 and was sold at ₹216. What is the holding period return?

The holding period return is 12%. The capital gain is ₹16 (216 minus 200) and the dividend is ₹8, so total gain is ₹24. Dividing ₹24 by the purchase price of ₹200 gives 12 per cent.

  1. A8%
  2. B12%Correct
  3. C4%
  4. D10%

Explanation

Return = (216 - 200 + 8) / 200 = 24/200 = 12%. Counting only the capital gain gives 8%. Counting only the dividend gives 4%. 10% has no valid derivation.

Did you get it right without looking?

One question tells you little. A timed set on Fundamentals of Risk and Return shows your real accuracy, how long you take and where you lose marks.

Practise Fundamentals of Risk and ReturnFree diagnostic mock

More Fundamentals of Risk and Return questions