Formula to calculate quarterly rate of return | ||||
Quarterly rate of return = Quarterly dividend/Preferred stock price | ||||
Quarterly rate of return | $0.539/$25 | |||
Quarterly rate of return | 2.16% | |||
Thus, the quarterly rate of return is 2.16% | ||||
Formula to calculate annual rate of return | ||||
Annual rate of return | Annual dividend/Preferred stock price | |||
Annual rate of return | (0.539*4)/25 | |||
Annual rate of return | 8.62% | |||
Thus, the annual rate of return is 8.62% | ||||
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