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Options
- A
Only A and B are true
-
Only B and C are true
Correct answer
- C
Only A and C are true
- D
All A, B, and C are true
Why this is the answer
The correct formula for calculating Simple Return is (Sale Price - Cost Price) / Cost Price, not Sale Price in the denominator. When dividends are paid and compounding needs to be factored in, CAGR is the prescribed method by SEBI for calculating returns. CAGR is the standard method for calculating returns for investment periods of 1 year or more. For less than 1 year, Simple Return is used.
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