FORMULAS CHFC HS328 || GET IT CORRECT.

FORMULAS CHFC HS328 || GET IT CORRECT.
Holding period return (relates profit on investment to beginning price) correct answers Income
received+change in value/beg value


Holding period return relative correct answers HPR + 1


(Income received+change in value/beg value)+1


Annualized rate of return correct answers R ear = (1+HPR)# -1 (Where # is increment if holding
pd/holding pd)


Arithmatic Mean return (avg of returns) correct answers R1+R2/2 or R1+R2+R3/3


Geometric mean return or time weighted rate of return correct answers GM=square root of
[(1+r1) (1+r2) (1+r3)] -1
Or GM=[(1+r1) (1+r2) (1+r3)]1/n (Exponent is 1/n). -1


Internal rate of return or dollar weighted rate of return correct answers N, PV,FV,PMT


Capital Asset Pricing Model (CAPM) or expected return on stock w/ risk correct answers E(Ri) =
Rf+Beta(Rm-Rf)


Expected return or ex rate E(R1) correct answers E(R1)=(P1xR1) + (P2xR2)+(P3+R3) where all
Ps=1


Or with weighting


E(R1)=W1(P1xR1) + W2(P2xR2)+W3(P3+R3)