Holding Period Return (HPR) Calculator

Holding Period Return Formula

The holding period return (HPR) is calculated using the following formula:

HPR = ((Ending Value - Beginning Value + Dividends) / Beginning Value) * 100

Where:

• Ending Value represents the value of the investment at the end of the holding period.
• Beginning Value represents the value of the investment at the beginning of the holding period.
• Dividends represents the total dividends received during the holding period.

The HPR is expressed as a percentage, indicating the overall return on the investment during the holding period.

Holding period return example

Let's dive into a real-life example to understand how the holding period return (HPR) works:

Suppose you invested $10,000 in a stock at the beginning of the year. Over the holding period, the stock price increased to $12,000, and you received $500 in dividends.

Using the HPR formula, we can calculate:

HPR = ((Ending Value - Beginning Value + Dividends) / Beginning Value) * 100
HPR = (($12,000 - $10,000 + $500) / $10,000) * 100
HPR = (2,500 / $10,000) * 100
HPR = 25%

Therefore, the holding period return for this investment is 25%, indicating a 25% gain on your initial investment.

The HPR helps you assess the performance of your investment and make informed decisions based on its return over a specific period.