Computation Of Total Returns By Reits Unitholders
0 Comments Published by slang September 5th, 2007 in Personal FinanceFirst time investors (or potential investors) in listed REITS may not be familiar with the computation of the total return or yield from the investment.
Below, we illustrate a simplified (but no less accurate) version of the computation:
Let’s assume the following figures:
|
$ per unit |
|
| (a) Initial Public Offering price |
1.00 |
| (b) Present market price |
1.20 |
| © Total distribution since listing ( net of tax) |
0.20 |
SOLUTION::
|
$ per unit |
|
| (a) Capital Appreciation: |
0.20 |
| Unit price increase ($1.20 minus $1.00 (IPO price)) | |
| (b) Income Distribution |
0.22 |
| Total Returns ($) per unit | 0.42 |
| Total Returns/Total Yield% ( $0.42 divided by $1.00) |
42% |
| Note: Total Returns = (a) Capital Appreciation per unit + (b) Total income (net of tax) since IPO |
If you found this post useful, keep updated with future posts by subscribing to REITs (for free) through RSS or email.
No Responses to “Computation Of Total Returns By Reits Unitholders”
Please Wait
Leave a Reply