Question

The New Fund had average daily assets of $2.7 billion in the past year. The fund sold $405 million and purchased $505 million worth of stock during the year. What was its turnover ratio?

Answer 1

Answer:

turnover ratio  = 16.87 %

Explanation:

given data

average daily assets = $2.7 billion

fund sold = $405 million

purchased = $505 million

solution

we get here turnover ratio that is express as

turnover ratio = $\frac{total\ stock\ sold}{daily\ assets}$    ................1

put here value and we get turnover ratio

turnover ratio = $\frac{405\ million}{2400\ million}$

turnover ratio  = 0.16875

turnover ratio  = 16.87 %