Finra Exam Series-6 Topic 9 Question 19 Discussion

Actual exam question for Finra's Series-6 exam

Question #: 19
Topic #: 9

Doc purchased shares of the MedTech Fund at its net asset value of $9.66 a share at the beginning of the year. The fund distributed dividends of $0.12 a share and capital gains of $0.10 a share during the year.

The net asset value at the end of the year was $12.00. The fund's total return was:

A21.3%.

B26.5%.

C25.5%.

D10.1%.

Show Suggested Answer

Suggested Answer: B

The fund's beginning NAV was $9.66, its ending NAV was $12.00, and its distributions during the year totaled $0.22 a share, so the total return on the MedTech Fund over this period was 26.5%. Total return can be calculated as:

[(ending NAV + distributions) - beginning NAV]/beginning NAV = [($12.00 + $0.22) -$9.66]/$9.66 = 26.5%.

by Annabelle at May 05, 2022, 11:05 AM

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