An investor purchased a bond 45 days ago for $985. He received $16 in interest and sold the bond for $980. What is the holding-period return on his investment

Question

asked Dec 7, 2021 204k views

1 Answer

Syrius · Answer 1 · 2021-12-14T04:06:42+0000

Answer: 1.11%

Step-by-step explanation:

Holding period return will be calculated as:

= (Selling price + Interest received - purchase price)/purchase price

Where Selling price = $980,

Interest Received = $16

Purchase price = $985

Thus Holding period return = (980+16-985)/985

= 11/985

= 0.0111

= 1.11%