A fund starts the year with NAV 54 per share. Over the year, the fund pays out income of 3.25 per share and capital gains distributions of 3.75 per share. Assets in the portfolio grew (shrank) by 0.01, and an expense ratio of 0.016 is charged at the end of the year. What is the rate of return on the fund? (Hint: calculate NAV1 first) 0.0953 O 0.1110 O 0.1169 O 0.1055 O 0.1235

A fund starts the year with NAV 54 per share. Over the year, the fund pays out income of 3.25 per share and capital gains distributions of 3.75 per share. Assets in the portfolio grew (shrank) by 0.01, and an expense ratio of 0.016 is charged at the end of the year. What is the rate of return on the fund? (Hint: calculate NAV1 first) 0.0953 O 0.1110 O 0.1169 O 0.1055 O 0.1235

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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A closed-end fund starts the year with a net asset value of $31. By year-end, NAV equals $33.00. At the beginning of the year, the fund is selling at a 3% premium to NAV. By the end of the year, the fund is selling at a 8% discount to NAV. The fund paid year-end distributions of income and capital gains of $3.40. Required: 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.) 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.)
$1,000 is invested in a fund at the beginning of the year. The fund rate of return is 8% for the first half of the year, and 10% for the second half. You are given the following methods of determining return, given the indicated transactions: Scenario Return Measure Midyear Transaction I Dollar-weighted $500 deposit II Dollar-weighted $500 withdrawal III Time-weighted $500 deposit IV Time-weighted $500 withdrawal Rank the rates of returns under these scenarios. A. I < II = IV < III B. II < III = IV < I C. III < I = II < IV D. IV < I = II < III E. None of these answers is correct.
A closed-end fund starts the year with a net asset value of $12.00. By year-end, NAV equals $12.70. At the beginning of the year, the fund was selling at a 4% premium to NAV. By the end of the year, the fund is selling at a 4% discount from NAV. The fund paid year-end distributions of income and capital gains of $1.30. 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.) b. What would have been the rate of return to an investor who held the same securities as the fund manager during the year? (Do not round intermediate calculations. Round your answer to 2 decimal places.)
A closed-end fund starts the year with a net asset value of $12.00. By year-end, NAV equals $12.10. At the beginning of the year, the fund was 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 $1.50.a. What is the rate of return to an investor in the fund during the year?b. What would have been the rate of return to an investor who held the same securities as the fund manager during the year?
QuantAlpha fund charges a 12b-1 fee of 1% and maintains an expense ratio of 0.75%. Assume the rate of return on fund portfolio (before any taxes) is 6% per year. How much will an investment of $1000 in the fund grow to after 10 years?
3. The value in pounds of a fund at time t = 0 is Vo = 50, 000. After one year (at t = 1) it has increased to V₁ = 51, 500 and at that time £1,500 is withdrawn. After two years (at t = 2) the fund is worth V₂ = 50, 800. Compute the time-weighted rate of return.
The New Fund had average daily assets of $3.9 billion in the past year. If New Fund's expense ratio was 0.80% and the management fee was 0.70%. a. What were the total fees paid to the fund's investment managers during the year? (Enter your answer in millions. Round your answer to 1 decimal place.) Fees paid million b. What were the other administrative expenses? (Enter your answer in millions. Round your answer to 1 decimal place.) Other administrative expenses million
What is the equivalent average annual effective rate of interest over 5-year period if the fund earns d^{(4)} = 4% for the initial 1 year, d^{(12)} = 6% for the next 2 years, and i^{(6)} = 9% in the last 2 years?
The value in pounds of a fund at time t = 0 is V0 = 50, 000. After one year (at t = 1) it has increased to V1 = 51, 500 and at that time £1, 500 is withdrawn. After two years (at t = 2) the fund is worth V2 = 50, 800. (a) Compute the time-weighted rate of return. (b) If the fund is liquidated after two years what is the yield that has been achieved?
The New Fund had average daily assets of $2.2 billion in the past year. New Fund's expense ratio was 1.1%, and its management fee was 0.7%. Required: a. What were the total fees paid to the fund's investment managers during the year? (Enter your answer in millions rounded to 1 decimal place.) Total fees paid million b. What were the other administrative expenses? (Enter your answer in millions rounded to 1 decimal place.) Other administrative expenses million
A pension fund starts the year with $50million. After 6 months it has appreciated to $60million at which point it pays out pension of $20million. In the second half of the year, the fund appreciates by a further 50% Required; 1. Calculate the annually compounded $ Time weighted rate of return 2. Calculate the annually $ weighted rate of return 3. Suppose that this fund has a midyear cash inflow of $ 20 million rather than an outflow. Would this reduce or increase the time weighted rate of return

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