Homework Answers
When we execute any contract, to save yourself from heavy losses, we can put stop loss order. Also when we short sell, we expect the prices to fall and if the prices rises we make a loss. So , In case of short sale, we should put a stop loss @ 120/ share.
Option D is correct.
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_may limit 10. Consider the following short sale example: an investor borrows 100 shares of...
please someone help me solve the two questions !!! 9. The current dividend of MultiGrowth Inc....
please someone help me solve the two questions !!!
9. The current dividend of MultiGrowth Inc. is $1.5. The company is expected to grow rapidly for the next 3 years at 30%, at the end of which time the new growth rate is expected to be a constant 8% a year. The required rate of return is 15%. What is the intrinsic value of the firm? A. $39.21 B. $39.50 C. $38.68 D. $39.59 10. Consider the following short sale...
exercise 2you decide to sell short 100 shares of Charlotte Horse Farms when it is selling at its yearly high of $56
exercise 2you decide to sell short 100 shares of Charlotte Horse Farms when it is selling at its yearly high of $56 . Your broker tells you that your margin requirement is 45 percent and the commission on the purchase is $155 . While you are short the stock , Charlotte pays a $2.50 per share dividend. At the end of the one year, you buy 100 shares of Charlotte at $45 to close out your position and are charged...
Options: 1. market; stop-loss; limit 2. sell; buy You sell 200 shares of a stock short...
Options:
1. market; stop-loss; limit
2. sell; buy
You sell 200 shares of a stock short for $46 per share. You want to limit your loss on this transaction to no more than $1,300. What order should you place? You should place order to 200 shares at s(Choose the correct answer from each drop-down menu and round to the nearest dollar.)
You sell short 200 shares of Doggie Treats Inc. which are currently selling at $52 per...
You sell short 200 shares of Doggie Treats Inc. which are currently selling at $52 per share. You post the 50% margin required on the short sale. If your broker requires a 28% maintenance margin, at what stock price will you get a margin call? (You earn no interest on the funds in your margin account and the firm does not pay any dividends) You short-sell 217 shares of Alibaba, at $108 per share. If you wish to limit your...
If you sold short 300 shares of Disney stock at $80 per share, you might want to limit your potential losses to about $5...
If you sold short 300 shares of Disney stock at $80 per share, you might want to limit your potential losses to about $5 per share. Assuming your order can be filled at the price you specify, which of the following orders would help you? a) limit buy b) limit sell c) stop buy d) stop sell e) all of the above
Carlos buys 100 shares of IBM for $100 per share on 50% margin. a) How much...
Carlos buys 100 shares of IBM for $100 per share on 50% margin. a) How much money does Carlos need to give to his broker, and how much money does he borrow? b) If IBM goes up to $120 per share, how many more shares could Carlos sell without sending his broker more money? c) If IBM goes down to $80 per share, how much money does Carlos have to send his broker to get back to the 50% margin...
Suppose you short-sell 100 shares of IBM, now selling at $120 per share. a. What is...
Suppose you short-sell 100 shares of IBM, now selling at $120 per share. a. What is your maximum possible loss per share? b. What happens to the maximum loss if you simultaneously place a stop-buy order at $128?
Suppose you buy a round lot of Francesca Industries stock (100 shares) on 60 percent margin...
Suppose you buy a round lot of Francesca Industries stock (100 shares) on 60 percent margin when the stock is selling at $30 a share. The broker charges a 8 percent annual interest rate, and commissions are 4 percent of the stock value on the purchase and sale. A year later you receive a $0.70 per share dividend and sell the stock for $40 a share. What is your rate of return on Francesca Industries? Do not round intermediate calculations....
The following orders exist for a particular stock: 1. Limit order: Buy 100 shares at 100.00...
The following orders exist for a particular stock: 1. Limit order: Buy 100 shares at 100.00 2. Limit order: Sell 100 shares at 102.00 3. Limit order: Buy 100 shares at 99.00 4. Sell stop order: Sell 100 shares at 97.50 on Stop The quoted price for the stock proceeds as follows: 101 at 102 101.50 at 102.50 100 at 101 99 at 100 98 at 99 96 at 97 For each order above:...
3. CL shares are selling at $71.40. An investor sells 1000 shares of CL short. The...
3. CL shares are selling at $71.40. An investor sells 1000 shares of CL short. The initial margin requirement is 35 percent, maintenance margin is 20%, and the commission is $4.95 per trade. After 180 days, the price goes down to $69.75 and the investor closes out the short position. While the investor is in the short position, CL pays $0.85 per share dividends. What is a. the annualized rate of return? b. the price at which there will be...
please someone help me solve the two questions !!!
9. The current dividend of MultiGrowth Inc. is $1.5. The company is expected to grow rapidly for the next 3 years at 30%, at the end of which time the new growth rate is expected to be a constant 8% a year. The required rate of return is 15%. What is the intrinsic value of the firm? A. $39.21 B. $39.50 C. $38.68 D. $39.59 10. Consider the following short sale...
Options:
1. market; stop-loss; limit
2. sell; buy
You sell 200 shares of a stock short for $46 per share. You want to limit your loss on this transaction to no more than $1,300. What order should you place? You should place order to 200 shares at s(Choose the correct answer from each drop-down menu and round to the nearest dollar.)
Suppose you buy a round lot of Francesca Industries stock (100 shares) on 60 percent margin when the stock is selling at $30 a share. The broker charges a 8 percent annual interest rate, and commissions are 4 percent of the stock value on the purchase and sale. A year later you receive a $0.70 per share dividend and sell the stock for $40 a share. What is your rate of return on Francesca Industries? Do not round intermediate calculations....
3. CL shares are selling at $71.40. An investor sells 1000 shares of CL short. The initial margin requirement is 35 percent, maintenance margin is 20%, and the commission is $4.95 per trade. After 180 days, the price goes down to $69.75 and the investor closes out the short position. While the investor is in the short position, CL pays $0.85 per share dividends. What is a. the annualized rate of return? b. the price at which there will be...
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