header bg

Scan QR code or get instant email to install app


A researcher has collected a sample of annual total returns on an index portfolio for U.S. large capitalization equity securities over the past five years of 11%, 5%, -13%, 8%, and 9%. Based only on this information, the best estimate of the holding period return to be earned by investing in this index over the next two years is closest to:

A 7.3%.

1212For investment horizons of over one year, the geometric mean return over the five years is the best estimator. Geometric mean return = . For a 2-year holding period the expected return is then

Related Information


Leave a Reply

Your email address will not be published. Required fields are marked *