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Suppose that every time a fund manager trades stock, transaction costs such as commissions and bid–ask spreads amount to 1.4% of the value of the trade. If the portfolio turnover rate is 50%, by how much is the total return of the portfolio reduced by trading costs? (Round your answer to 1 decimal place.)

Fall in returns %

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92812916

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