Question

Risk and return analysis

Given below is hypothetical data on two stocks on the LUSE and the market data (All Lusaka Share Index). The market data already includes dividends paid during the year.

 

Stock 1                            Stock 2                            Market Index

Year   Stock Price  Dividend      Stock Price  Dividend      (Includes Dividends)

2013:  K25.88          K1.73           K73.13          K4.50           17,495.97

2012:  22.13            1.59              78.45            4.35              13,178.55

2011:  24.75            1.50              73.13            4.13              13,019.97

2010:  16.13            1.43              85.88            3.75              9,651.05

2009:  17.06            1.35              90.00            3.38              8,403.42

2008:  11.44            1.28              83.63            3.00              7,058.96

 

Required:

Question text

What is the appropriate average Annual Return for Stock 1?


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