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14 June, 22:52

Assume that you purchased shares of High Flying mutual fund at a net asset value of $12.50 per share. During the year, you received dividend income distributions of $0.78 per share and capital gains distributions of $1.67 per share. At the end of the year, the shares had a net asset value of $13.87 per share. What was your after-"tax" rate of return on this investment

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  1. 14 June, 23:16
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    30.56%

    Explanation:

    Net asset value of $13.87 per share

    Flying mutual fund at a net asset value of $12.50

    Dividend income distributions of $0.78 per share

    Capital gains distributions of $1.67 per share

    Hence;

    R = ($13.87 - $12.50 + 0.78 + 1.67) / $ 12.50

    R = 30.56%

    Therefore your after-"tax" rate of return on this investment will be 30.56%
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