FIN 501 Lecture Notes - Lecture 1: Frequency Distribution, Dividend Yield, Standard Deviation
Document Summary
Calculate the return on an investment using different methods. Historical returns on various important types of investments. Historical risk on various important types of investments. Suppose: you invest / mnth, your investments earn 9%/ yr, you decide to take advantage of deferring taxes on your investments, take you 36. 23 years. is around the size of a new car payment, perhaps your employer will kick in. /month: over the last 84 years, the s&p 500 index return was about 12%. 2 key observations (important investment guidelines: substantial reward, on average, for bearing risk, greater risks accompany greater returns. Total dollar returns returns on an investment measured in dollars, accounting for all interim cash flows and capital gains or losses. Total percent returns return on an investment measured as a percentage of the original investment. Example: calculating total dollar and total percent returns. Suppose you invested ,400 in a stock with a share price of .