Explain how ‘selling a stock short’ may result... Explain how ‘selling a stock short’ may result...
Explain how ‘selling a stock short’ may result...
Explain how ‘selling a stock short’ may result in unlimited losses for the short seller.
Homework Answers
ANSWER:
Short selling can lead to unlimited losses.
Let me explain with an example
You short sell a stock of current price $ 500 but now it's price can rise to $700 $1000 and even beyond that. So theoretically if you don't square off your position and share price keeps on increasing , you will account unlimited losses.
Add Answer to:
Explain how ‘selling a stock short’ may
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Explain how ‘selling a stock short’ may result...
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please explain how you can make money short selling a stock.
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Question 19 (8 POINTS) Assume you sold short 100 shares of common stock at margin is 60% shares of common stock at $50 per share. The initial a) What would be the maintenance margin if a margin call is made at a stock of $602 b) What is the maximum potential loss for a short seller? Briefly explain.
Question 33 of 75. Which of the following statements regarding the reporting of sales of stock is NOT true? If the total of sales of stock in the same year result in a loss, the sales are not reported on the taxpayer's return O Short-term and long-term capital gains and losses are reported on Form 8949 and carried to Schedule O Total capital gain is computed by combining net short-term gains and losses and net long-term gains and losses O...
512 puis UL UNU. How many shar Seth owns 150 shares of stock with a bad UI 5 1,000 does he now own, and what is his basis per share? 50 shares with a basis of $36 per share. O 50 shares with a basis of $108 per share. 450 shares with a basis of $4 per share. O 450 shares with a basis of $12 per share. Mark for follow up Question 31 of 75. Which of the following...
V. If you have order-by-order trades and quotes data of a stock, explain how you can identify each transaction as "buyer initiated order" or "seller initiated order". Ex- plain the economic implications of this identification. How do you devise a trading strategy based on the order imbalance.
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