In: Finance
You bought a bond for $950 1 year ago. You have received a coupon of $60. You can sell the bond for $977 today. What is your total dollar return?
What is the arithmetic mean for the following stock returns: R1=6.3%, R2=4%, R3=7.2%?
1.Total dollar return=(End value-Beginning value+Annual coupon)
=(977-950+60)
=$87
2.Artihmetic mean=Total return/Total time period
=(6.3+4+7.2)/3
=5.83%(Approx)