Series 66: Total Return

Taken from our Series 66 Online Guide

Total Return

An investor may earn additional revenues from an investment in addition to appreciation in the value of the investment.

Total return includes appreciation, as well as dividends and interest (income).

To find the annualized total return, divide the total return by the annualized period of time, or the amount of time in years the investment was held.


Example Question 1

Jake bought 1,000 shares of XYZ Company at $25. Two years later, Jake sold his shares at $30. In that period, the company paid a $.25 quarterly, per share dividend. Calculate Jake’s annualized total return, not taking into account compounded interest.

Answer: 14%

Explanation: Appreciation on XYZ = $30,000 - $25,000 = $5,000

XYZ dividends = $.25 x 8 quarters x 1,000 shares&#

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