# Holding period return

In

finance ,**holding period return**(HPR) is a measurement of return on anasset or portfolio. It is one of the simplest measures ofinvestment performance.HPR is the percentage by which the value of a portfolio (or asset) has grown for a particular period. It is the sum of

net income andcapital gains divided by the initial period value (asset value at the beginning of the period).**HPR**= ((Present Value, or face Value, End-Of-Period Value) + (Any Intermediate Gains eg. Dividends) - (Initial Value)) /(Initial Value)"'$HPR\_n\; =\; frac\{Income\; +\; (P\_\{n+1\}\; -\; P\_n)\}\{P\_n\}$

**Example**To the right is an example of a stock investment of

**one share purchased at the beginning of the year for $100**. At the end of the first quarter the stock price is $98. This is a capital loss. The stock share bought for $100 can only be sold for $98, which is the value of the investment at the end of the first quarter. The first quarter return is:($98 - $100 + $1) / $100 = -1%

Since the final stock price is $99, the annual ROI is:

($99 ending price - $100 beginning price + $4 dividends) / $100 beginning price = 3% ROI. If the final stock price had been $95, the annual ROI would be:

($95 ending price - $100 beginning price + $4 dividends) / $100 beginning price = -1% ROI.

**Annualizing the holding period return****Over multiple years**To "annualize" a holding period return (translate it into percentage per year), then

Annualized HPR = (((Present Value, or face Value, End-Of-Period Value) + (Any Intermediate Gains eg. Dividents) - (Initial Value)) /(Initial Value)) + 1 ) ^ ( 1 / (Years) ) - 1

$Annualized\_HPR\_n=((\; [D\_1\; +\; (P\_\{n+1\}\; -\; P\_n)]\; /P\_n)\; +\; 1)^\{,!1/Years\}-1$

Years being number of years that have passed. For example, if you have held the item for half a year, year would equal 1/2.

**From quarterly holding period returns**To calculate an annual HPR from four quarterly HPRs:

If HPR1 through HPR4 are the holding period returns for four consecutive periods, the annual

**HPR**is calculated as follows:(1 +

**HPR**)= (1 + HPR1)(1 + HPR2)(1 + HPR3)(1 + HPR4)

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2010.*

### Look at other dictionaries:

**Holding period return**— The rate of return over a given period. The New York Times Financial Glossary … Financial and business terms**holding-period return**— rate of return on an investment over a given period. Bloomberg Financial Dictionary … Financial and business terms**holding period return**— rate of return on an investment over a given period. Bloomberg Financial Dictionary … Financial and business terms**Holding Period Return/Yield**— The total return received from holding an asset or portfolio of assets. Holding period return/yield is calculated as the sum of all income and capital growth divided by the value at the beginning of the period being measured. Holding period… … Investment dictionary**annualized holding-period return**— The annual rate of return that when compounded ( compounding)t times generates the same T period holding period return as actually occurred from period 1 to period t. Bloomberg Financial Dictionary … Financial and business terms**Annualized holding period return**— The annual rate of return that when compounded t times, would have given the same t period holding return as actually occurred from period 1 to period t. The New York Times Financial Glossary … Financial and business terms**T-period holding-period return**— The percentage return over the T year period an investment lasts. The New York Times Financial Glossary The percentage return over the T year period an investment is held. Bloomberg Financial Dictionary … Financial and business terms**holding-period yield**— ( HPY) The annual rate of return actually realized on an investment in a bond. Bloomberg Financial Dictionary … Financial and business terms**holding period yield**— ( HPY) The annual rate of return actually realized on an investment in a bond. Bloomberg Financial Dictionary … Financial and business terms**Return of the Killer Tomatoes**— Infobox Film name = Return of the Killer Tomatoes! caption = Theatrical release poster. director = John De Bello producer = Stephen Peace writer = John De Bello Costa Dillon Stephen Peace starring = Michael Villani John Astin Karen Mistal Anthony … Wikipedia