Pfin (with Mindtap, 1 Term Printed Access Card) (mindtap Course List)
7th Edition
ISBN: 9780357033609
Author: Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk
Publisher: Cengage Learning
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Chapter 13, Problem 8FPE
Summary Introduction
To calculate: The
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A year ago, the Very Large Growth Fund was being quoted at an NAV of $21.18and an offer price of $22.53.Today, it's being quoted at $23.39 (NAV) and $24.88 (offer). What is the holding period return on this load fund, given that it was purchased a year ago and that its dividends and capital gains distributions over the year have totaled $0.97 per share? Assume that none of the dividends and capital gains distributions are reinvested into the fund. (Hint:You, as an investor, buy fund shares at the offer price and sell at the NAV.)
Consider a no - load mutual fund with $ 500 million in assets , 50 million in debt , and 12 million shares at the start of the year , and $ 600 million in assets , 40 million in debt , and 16 million shares at the end of the year . During the year investors have received income distributions of $ 0.50 per share , and capital gains distributions of $ 0.40 per share . Assuming that the fund carries no debt , and that the total expense ratio is 0.90 % , what is the rate of return on the fund ?
12.
A year ago, the Really Big Growth Fund was being quoted at an NTA of $21.50 and anoffer price of $23.35; today it is being quoted at $23.04 (NTA) and $25.04 (offer). What is theholding period return on this listed fund (a) based on NTA values and (b) based on offer prices?Assume that it was purchased a year ago and that its income and capital gains distributions overthe year have totalled $1.05 per share? Which HPR would you use to evaluate the fundmanager’s performance? Why?
Chapter 13 Solutions
Pfin (with Mindtap, 1 Term Printed Access Card) (mindtap Course List)
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