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1&2) future current income

future capital appreciation

owe h Ch 13: Assignment - Investing in Mutual Funds, ETFS, and Real Estate 7. Forecasting mutual fund value Evaluating Mutual Fund Performance When buying a mutual fund, you might expect to earn money through (from dividends), (from increases in share price of the fund's underlying securities), or both. You can calculate your total earnings from a given investment by determining the approximate yield. This value makes it easier to compare investment options. Using Approximate Yield with Mutual Funds The formula for approximate yield of an investment can look intimidating, but it's just a function of three things: (1) dividends earned, (2) capital gains distributions received, and (3) change in share price. Based on the information in the table, compute the approximate yield for each of the two funds that follow. Mutual Fund 1 Mutual Fund 2 Annual dividends and capital gains distributions $1.00 $2.70 Beginning mutual fund share price $55 $117 Ending mutual fund share price $67 $147 and the approximate yield for Mutual Fund 2 is The approximate yield for Mutual Fund1 is True or False: For these investments to be equally attractive, Mutual Fund 2 must carry a lower risk than Mutual Fund 1. False True 7. Forecasting mutual fund value Evaluating Mutual Fund Performance When buying a mutual fund, you might expect to earn money through (from dividends), (from increases in share price of the fund's underlying securities), or both. You can calculate your total from a given investment by determining the approximate yield. This value makes it easier to compare investment options. Using Approximate Yield with Mutual Funds The formula for approximate yield of an investment can look intimidating, but it's just a function of three things: (1) dividends earned, (2) capital gains distributions received, and (3) change in share price. Based on the information in the table, compute the approximate yield for each of the two funds that follow. Mutual Fund 1 Mutual Fund 2 Annual dividends and capital gains distributions $2.70 $1.00 Beginning mutual fund share price $55 $117 Ending mutual fund share price $67 $147 and the approximate yield for Mutual Fund 2 is The approximate yield for Mutual Fund 1 is 19.67% ctive, Mutual Fund 2 must carry a lower risk than Mutual Fund 1. True or False: For these investments to be 5.17% False 17.048% True 21.31% (from dividends), to earn money through ases in share price of the fund's underlying securities), or both. You can calculate your total earnings proximate yield. This value makes it easier to compare investment options. Using Approximate Yield with Mutual Funds vestment can look intimidating, but it's just a function of three things: (1) dividends elved, and (3) change in share price. Based on the information in the table, compute the ds that follow. Mutual Fund 1 Mutual Fund 2 outions $1.00 $2.70 $55 $117 $67 $147 and the approximate yield for Mutual Fund 2 is attractive, Mutual Fund 2 must carry a lower risk than M 4.99% 24.77% 21.0545% 22.73%

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