Assignment for Thursday, November 16 - Using Excel, calculate the annual percent

Question

Assignment for Thursday, November 16 - Using Excel, calculate the annual percentage return for Nike, The Gap, Adidas, and the S&P; 500 for the past 36 years. You only have capital gains information (no dividends) to compute the annual return. Also, note that Adidas does not have pricing data prior to 2007, so you will only have 10 years of calculated returns for Adidas. Bring a printed copy of your spreadsheet to class to turn in for credit. If you have a laptop, please bring it to class as we will finish working with this historical data in class. Stock Price Data GPS Return Calculations-Percentage NKE NKE ADDYYGSPC UAA Under ADDYY The Gap, Adidas S&P; 500 129.55 120.40 $145.30 163.41 179.63 $211.78 $274.08 $ 257.07 $297.47 329.08 343.9:3 $408.78 $438.78 $481.61 $470.42 $636.02 $ 786.16 980.28 $1,279.64 $ 1,394.46 $1,366.01 $ 1,130.20 $855.70 Date Nike Inc Nike Armour Adidas S&P; 500 1/1/81 $ 0.11 0.05 $ 1/1/82 $ 0.17 0.05 $ 1/1/83 $ 0.24 0.11 $ 1/1/84 $ 0.17 0.11 $ 1/1/85 $ 0.11 0.15 $ 1/1/86 $ 0.20 0.49 $ 1/1/87 $ 0.15 0.99 $ 1/1/88 $ 0.21 0.47 $ 1/1/89 $ 0.37 0.91 $ 1/1/90 $ 0.62 1.17 $ 1/1/91 $ 1.19 2.16 1/1/92 $ 1.83 5.45 $ 1/1/93 $ 2.03 3.56 $ 1/1/94 $ 1.25 4.41 $ 1/1/95 $ 1.77 3.43 $ 1/1/96 $ 3.49 5.04 $ 1/1/97 $ 6.86 6.21 $ 1/1/98 $ 4.04 12.75 $ 1/1/99 $ 4.61 31.53 $ 1/1/00 $ 4.63 33.00 $ 1/1/01 $ 5.64 24.14$ 1/1/02 $ 6.22 10.72 $ 1/1/03 $ 4.65 $ 10.96 $

Explanation / Answer

for Nike,

Annual return=(value at the end/value at beginning)^(1/number of years)-1

=(52.38/0.11) ^(1/37)-1=0.181~ 18.1%

for GaP,

Annual return=(value at the end/value at beginning)^(1/number of years)-1

=(22.40/0.05)^(1/37)-1 = 0.179~ 17.9%

for adidas,

Annual return=(value at the end/value at beginning)^(1/number of years)-1

=(78.09/19.26)^(1/11)-1

=0.135~ 13.5%

for S&P 500,

Annual return=(value at the end/value at beginning)^(1/number of years)-1

=(2278.87/129.55)^(1/37)-1

=0.0805~ 8.05%

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