Assume That You Have Invested $500 000 to Purchase Shares

question 7

Multiple Choice

Assume that you have invested $500 000 to purchase shares in a hedge fund reporting $800 million in assets, $100 million in liabilities and 70 million shares outstanding. Your initial lock-out period is 3 years. If the share price after 3 years increases to $15.28, and using your calculation for how many shares you purchased, what is your annualised return over the 3-year holding period?

• A)14.45%
• B)15.18%
• C)16.00%
• D)17.73%

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