Stock Valuation: Determining Value for a One-Year Hold

Not Required Factors for Valuing a Stock

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Question

Which of the following is not required to determine the value of a stock that is to be held for one year?

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Explanations

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A. B. C. D.

C

A stock that is held for one year earns the investor some dividend and will be sold after one year for some capital gain. Both the expected sale price and the dividend payout during the one-year holding period need to be discounted to reflect the present value of the stock.