You purchased a bond 75 days ago for $901.49. You received an interest payment of $24.00 62 days ago. Today the bond’s price is $939.14. What is the holding period return (HPR) on the bond as of today? (Negative value should be indicated by a minus sign. Round your answer to 2 decimal places.) HPR
Expert Answer
Holding Period Return (HPR) = Income + (End of Period Value – Initial Value) / Initial Value
= {$ 24 + ($ 939.14 – $ 901.49)} / $ 901.49
= 6.84%
Note: If the investment in the purchase of bond was in a different year
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