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2.1.2 Stock return
Return indicates the yield that is earned by investors from invested funds.
There are two classification of return : ( Jogiyanto, 2010)
a) Realized (actual) r eturn
Realized return is calculated based on the historical data. Realized return is
important because it is one of the benchmark in measuring company’s performance
and the foundation to determine the future expected return.
b) Expected return
Expected return is the return that will be obtained by investors in the future. It
uses the value of actual return to do the further calculation.
According to Madura (2010), the measurement of stock return is elaborated as
follow :
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