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Calculate the returns for suggesting the better stock

    Assignment Instructions

    Assignment ID: FG132956769

    Mr. Ahmad intends to invest in a stock in order to enjoy an increase in his income. He finds out two stocks of his concern for the investment. The following information pertains to the said stocks:

    Stock A: It was purchased 60 days ago at Rs. 1,000 and currently selling at Rs. 1,500. It has paid a divdend of Rs. 30.

    Stock B: It was purchased 45 days ago at Rs. 700 and currently selling at Rs. 1,200. It has paid a dividend of Rs. 25.

    Mr. Ahmad is confused in the selection of stock with maximum return.

    Requirements:

    Problem 1: As a student of Investment Analysis and Portfolio Management, you are required to calculate the returns for suggesting the better stock to Mr. Ahmad:

    1. Dividend Yield and Capital Appreciation (%) on stock A and B.

    2. Holding Period Return (HPR) on stock A and B.

    3. Annual Holding Period Return (HPR) on stock A and B.

    4. On the basis of above calculations, identify which stock is better for the investment and why?

     

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