Rate of return to an investor in the fund during the year

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Reference no: EM131991930

A closed-end fund starts the year with a net asset value of $27. By year-end, NAV equals $28.60. At the beginning of the year, the fund is selling at a 2% premium to NAV. By the end of the year, the fund is selling at a 7% discount to NAV. The fund paid year-end distributions of income and capital gains of $3.00.

a. What is the rate of return to an investor in the fund during the year? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

Rate of return ________ %

b. What would have been the rate of return to an investor who held the same securities as the fund manager during the year? (Round your answer to 2 decimal places.)

Rate of return ___________ %

Reference no: EM131991930

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