1. The total return(%) on the stock = (X1-X0)×100%/X0
2. The total return(%) on the short = (X0-X1)×100%/X0
Problem 3 Suppose that to short a stock you are required to deposit an amount equal to the initial price Xo of the stoc...
You believe the price of Freeze Frame Co. stock is going to fall, so you short 1,050 shares at a price of $82. The initial margin is 60 percent. Ignore dividends. a. Construct the equity balance sheet for the original trade. (Input all amounts as positive values.) b-1. Construct an equity balance sheet for a stock price of $73 per share. (Input all amounts as positive values.) b-2. What is your margin? (Do not round intermediate calculations. Enter your answer...
Suppose that you SHORT FIVE May 2016 Gold futures contracts at the opening price of $1,119.40/oz on May 4, 2019. You close out your position on May 8, 2019 at a price of $1,110.50/oz. The initial margin and the maintenance margin requirements are $4,400 per contract and $4,000 per contract, respectively. Contract size is 100 troy ounces per contract. Assume that you deposit the initial margin in cash for the FIVE contracts sold and did not withdraw the excess on...
Suppose you bought 500 shares of stock at an initial price of $44 per share. The stock paid a dividend of $0.42 per share during the following year, and the share price at the end of the year was $45. Compute your total dollar return on this investment. Total dollar return
You short sold 1,200 shares of stock at a price of $30 and an initial margin of 75 percent. If the maintenance margin is 30 percent, at what share price will you receive a margin call? What is your account equity at this stock price? (Do not round intermediate calculations. Round your answers to 2 decimal places.) Margin call price Account equity 2 decimal places required.
Suppose you bought 450 shares of stock at an initial price of $50 per share. The stock paid a dividend of $.52 per share during the following year, and the share price at the end of the year was $51. Compute your total dollar return on this investment. (Omit the "$" sign in your response.) Total dollar return $
1. value: 3.75 points Problem 1-1 Suppose you bought 300 shares of stock at an initial price of $46 per share. The stock paid a dividend of $.44 per share during the following year, and the share price at the end of the year was $47. Compute your total dollar return on this investment. (Omit the "$" sign in your response.) Total dollar return
Today you short sell 500 shares of Stock Z, which is trading at $30 per share. Stock Z does not pay any dividend, and the interest rate is 0%. (a) The initial margin is 40%. What is the amount of equity in your account? (b) A day later you receive a margin call, when the price is $40. What is the maintenance margin? (You will not receive a margin call if the price is $39.99.) (c) When you receive the margin call at $40,...
Assume that you just short sold 300 shares of Spencer stock at $120 per share. The initial margin requirement (IMR) is 50 percent and the maintenance margin requirement (MMR) is 30 percent a. What is the margin deposit required for this transaction? (6 pts) b. What will be your rate of return if the stock price goes to $127 per share over the next 60 days and you close your position at the end of that time? (7 pts)
Question 1 Suppose you bought 500 shares of stock at an initial price of $37 per share. The stock paid a dividend of $0.28 per share during the following year, and the share price at the end of the year was $34. Compute your total dollar return on this investment. (Negative amounts should be indicated by a minus sign. Omit thes" sign in your response) Question 1 Suppose you bought 500 shares of stock at an initial price of $37...
Suppose you bought 300 shares of stock at an initial price of $46 per share. The stock paid a dividend of $0.44 per share during the following year, and the share price at the end of the year was $47. Compute your total dollar return on this investment.