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Calculate the annualised holding period return

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Reference no: EM132687667

Investment A expects to pay quarterly dividends of $0.65 per share and is currently trading at $32.30 per share. You anticipate that you could sell the share for $35 in six months time.

Investment B expects to pay half yearly dividends of $4.20 and is currently trading at $22.30 per share. You anticipate that you could sell this share for $23.95 in 12 months time

Problem a) Calculate the annualised holding period return for each investment

Problem b) Assuming each of these investments carries the same degree of risk, which would you decide to invest in and why?

Reference no: EM132687667

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