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| | The writer is called Irwin Wunder but it's not [http://mtomtech.co.kr/bbs/?document_srl=92816 over the counter std test] most masucline title out there. Hiring has been my profession for some time but I've currently utilized for another 1. Doing ceramics is what adore doing. South Dakota is where I've always been living. |
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| In [[finance]], '''holding period return''' (HPR) is the total return on an [[asset]] or [[Portfolio (finance)|portfolio]] over the period during which it was held. It is one of the simplest measures of [[investment performance]].
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| HPR is the percentage by which the value of a portfolio (or asset) has grown for a particular period. It is the sum of [[income]] and [[capital gains]] divided by the initial period value (asset value at the beginning of the period).
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| '''HPR''' = ((Present Value, or face Value, End-Of-Period Value) + (Any Intermediate Gains e.g. Dividends) - (Initial Value)) /(Initial Value)'''
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| <math>HPR_n \ = \ \frac{Income + (P_{n+1} - P_n)}{P_n}</math>
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| ==Example==
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| <!--Where, in this example, is HPR mentioned? Example shortly to be deleted. -->
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| {| class="wikitable" style="text-align:center" align="right"
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| |+Example: Stock with low volatility and a regular quarterly dividend
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| ! End of: !! 1st Quarter !! 2nd Quarter !! 3rd Quarter !! 4th Quarter
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| ! Dividend
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| | $1 || $1 || $1 || $1
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| |-
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| ! Stock Price
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| | $98 || $101 || $102 || $99
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| |-
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| ! Quarterly ROI
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| | -1%|| 4.08%|| 1.98%|| -1.96%
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| ! Annual ROI
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| | || || || '''3%'''
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| |}
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| To the right is an example of a stock investment of '''one share purchased at the beginning of the year for $100'''. At the end of the first quarter the stock price is $98. This is a capital loss. The stock share bought for $100 can only be sold for $98, which is the value of the investment at the end of the first quarter. The first quarter return is:
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| ($98 – $100 + $1) / $100 = -1%
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| Since the final stock price is $99, the annual ROI is:
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| ($99 ending price - $100 beginning price + $4 dividends) / $100 beginning price = 3% ROI.
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| If the final stock price had been $95, the annual ROI would be:
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| ($95 ending price - $100 beginning price + $4 dividends) / $100 beginning price = -1% ROI.
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| ==Annualizing the holding period return==
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| ===Over multiple years===
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| To ''annualize'' a holding period return (translate it into percentage per year), then
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| [[AHPR|Annualized HPR]] = (((Present Value, or face Value, End-Of-Period Value) + (Any Intermediate Gains e.g. Dividends) - (Initial Value)) /(Initial Value)) + 1 ) ^ ( 1 / (Years) ) - 1
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| <math>\mathrm{Annualized\, HPR}_{n}=\left(\frac{D+(P_{n+1}-P_{n})}{P_{n}}+1\right)^{\frac{1}{t}}-1</math>
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| t being number of years that have passed. For example, if you have held the item for half a year, year would equal 1/2.
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| ===From quarterly holding period returns===
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| To calculate an annual HPR from four quarterly HPRs:
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| If HPR1 through HPR4 are the holding period returns for four consecutive periods, the annual '''HPR''' is calculated as follows:
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| <math>1+HPR=\left(1+HPR_{1}\right)\left(1+HPR_{2}\right)\left(1+HPR_{3}\right)\left(1+HPR_{4}\right)</math>
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| {{DEFAULTSORT:Holding Period Return}}
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| [[Category:Basic financial concepts]]
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| [[Category:Mathematical finance]]
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The writer is called Irwin Wunder but it's not over the counter std test most masucline title out there. Hiring has been my profession for some time but I've currently utilized for another 1. Doing ceramics is what adore doing. South Dakota is where I've always been living.