Question

Imagine you purchased 75 shares of this stock on Day 1 and sold all of those shares on Day 3. What is the return on your investment? Show your work.

Day 1

75 shares x price = 13,179


Day 3


75 shares x price = 13,293

Return on Investment = (Final value - Initial value) / Initial value





If you had sold all of the stock on Day 5 instead of Day 3, what is the difference between the return on your investment? Show your work.
Day 1

75 shares x price = 13,179

Day 5

75 shares x price = 13,177.5


Return on Investment = (Final value - Initial value) / Initial value

Answer 1

Day 1: 75 shares x price = 13,179
price = 13,179 / 75 shares = 175.72 price per share

Day 3 : 75 shares x price = 13,293
price = 13,293 / 75 shares = 177.24 price per share

Return on Investment = (Final value - Initial value) / Initial value
ROI = (13,293 - 13,179) / 13,179 = 0.00865
0.00865 x 100% = 0.87%

If share is sold in Day 5 instead of Day 3.
Day 5 : 75 shares x price = 13,177.5
price = 13,177.50 / 75 shares = 175.70 per share

Return on Investment = (Final value - Initial value) / Initial value
ROI = (13,177.50 - 13,179) / 13,179 = -0.000113
-0.000113 x 100% = -0.011%

If I had sold my shares in Day 3, I would have gained positive ROI because price per share increased.

If I had sold my shares in Day 5, I would have lost a bit because price per share decreased resulting to a negative ROI