Over a period of one year, an investor’s portfolio has declined in value from 127,350 to 108,427. What is the continuously compounded rate of return? A) -14.86%. B) -16.09%. C) -11.72%. D) -13.84%.
B
e^r = 108427/127350 r = ln (108427/127350) B) -16.09%.
i thought it was Ln of 1+hpr? d?
supersharpshooter Wrote: ------------------------------------------------------- > e^r = 108427/127350 > > r = ln (108427/127350) > > B) -16.09%. nice
D ln ( 1 + HPR)
shreya4848 Wrote: ------------------------------------------------------- > D > > ln ( 1 + HPR) nice
Thanks all! Can anybody explain how to put these on the TI calculator??
it works as 1+HPR ln HPR=(108427-127350)/127350 =-.1486+1=.8514 ln 8514 = -.1609
well hey now which one is right?
the negative! awesome…im fired
B is correct… But I don’t understand the “ln” part of it…
A sort of cheat to this, so you don’t remember another formula… is just use the TVM features on your calc… set a number of periods sufficiently large… 1000 usually does it… then solve for the rate and multiply that by the number of periods.
spo it seems der are 2 ways LN (end val/beg vlaue) or LN ( 1 + HPR) HPR is easy to get, so i might do it this second way and brand this formmula in my head CC = LN (1 + HPR)
mcf Wrote: ------------------------------------------------------- > A sort of cheat to this, so you don’t remember > another formula… is just use the TVM features on > your calc… set a number of periods sufficiently > large… 1000 usually does it… then solve for the > rate and multiply that by the number of periods. Mannnnn, this trick works… thanks a bunch!!! Thanks everyone!!
mcf Wrote: ------------------------------------------------------- > A sort of cheat to this, so you don’t remember > another formula… is just use the TVM features on > your calc… set a number of periods sufficiently > large… 1000 usually does it… then solve for the > rate and multiply that by the number of periods. nice 
highly recommended
It’s all about the shortcuts at this point… (can you believe I started quant without a calculator and did this crap by hand?!? – I was friggin’ nuts!)
mcf Wrote: ------------------------------------------------------- > It’s all about the shortcuts at this point… > > (can you believe I started quant without a > calculator and did this crap by hand?!? – I was > friggin’ nuts!) no wonder, you are soooo clear in your concepts… hats off!! BA Plus 2 makes life easier…
finfan Wrote: ------------------------------------------------------- > mcf Wrote: > -------------------------------------------------- > ----- > > A sort of cheat to this, so you don’t remember > > another formula… is just use the TVM features > on > > your calc… set a number of periods > sufficiently > > large… 1000 usually does it… then solve for > the > > rate and multiply that by the number of > periods. > > > Mannnnn, this trick works… thanks a > bunch!!! > > Thanks everyone!! yeah thats pretty nifty…excellent way to check your work and yes…its very nice! ha ha
lets do a question on question: if none of the $ amounts are given… what is the HPR if cont comp return is -16.08% ?