You sell a stock short. How can you use an option to reduce your risk of loss
Question:
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 50% (8 reviews)
One strategy that reduces the risk of loss when a stock is purchased is to ...View the full answer
Answered By
Asim farooq
I have done MS finance and expertise in the field of Accounting, finance, cost accounting, security analysis and portfolio management and management, MS office is at my fingertips, I want my client to take advantage of my practical knowledge. I have been mentoring my client on a freelancer website from last two years, Currently I am working in Telecom company as a financial analyst and before that working as an accountant with Pepsi for one year. I also join a nonprofit organization as a finance assistant to my job duties are making payment to client after tax calculation, I have started my professional career from teaching I was teaching to a master's level student for two years in the evening.
My Expert Service
Financial accounting, Financial management, Cost accounting, Human resource management, Business communication and report writing. Financial accounting : • Journal entries • Financial statements including balance sheet, Profit & Loss account, Cash flow statement • Adjustment entries • Ratio analysis • Accounting concepts • Single entry accounting • Double entry accounting • Bills of exchange • Bank reconciliation statements Cost accounting : • Budgeting • Job order costing • Process costing • Cost of goods sold Financial management : • Capital budgeting • Net Present Value (NPV) • Internal Rate of Return (IRR) • Payback period • Discounted cash flows • Financial analysis • Capital assets pricing model • Simple interest, Compound interest & annuities
4.40+
65+ Reviews
86+ Question Solved
Related Book For
Question Posted:
Students also viewed these Accounting questions
-
How can one use an interest rate swap to change a fixed rate loan into a floating rate loan?
-
A call option on Michigan stock specifies an exercise price of $55. Today the stock's price is $54 per share. The premium on the call option is $3. Assume the option will not be exercised until...
-
A put option on Iowa stock specifies an exercise price of $71. Today the stock's price is $68. The premium on the put option is $8. Assume the option will not be exercised until maturity, if at all....
-
Identify possible opportunities for denormalizing these relations as part of the physical design of the database. Which ones would you be most likely to implement
-
In what situations would an auditor issue an adverse opinion?
-
Briefly describe TWO (2) drawbacks of NoSQL in comparison with RDBMS ?
-
Traditional management theory was designed to provide control and structure to which types of organizations? A. Hospitals. B. Scientific laboratories. C. Manufacturing industry. D. Institutions of...
-
Stock Dividends The Stockholders Equity category of Worthy Companys balance sheet as of January 1, 2010, appeared as follows: Common stock , $10 par, 40,000 shares issued and outstanding ....$400,000...
-
The department you manage has just been hit with a major HIPAA violation. As the manager, you must retrain your entire staff on the importance of HIPAA. Describe how this can financially impact your...
-
Scribners Corporation produces fine papers in three production departments-Pulping, Drying, and Finishing. In the Pulping Department, raw materials such as wood fiber and rag cotton are mechanically...
-
You expect the price of a stock to decline but do not want to sell the stock short and run the risk that the price of the stock may rise dramatically. How could you use a bear spread strategy to take...
-
How do collars, the hedge ratio, the protective call, and the protective put help investors manage risk?
-
A pay-as-you-go cell phone company offers a monthly plan for $19 that includes 200 minutes of calls. After that, calls are an additional 4 cents per minute up to a maximum of 1,000 minutes. Let C(m)...
-
The expected pretax return on three stocks is divided between dividends and capital gains in the following way: stock expected dividend expected capital gain A $0 $10 B $5 $5 C $10 $0 Required: a. If...
-
Acme Incorporated manufactures anvils for use in iron molding. Information regarding their 2021 operating and production performance follows. Throughput Time 11 days Inspection Time 1 days Process...
-
Rewrite: Use what you have learned regarding academic and professional tools/resources and rewrite Terry's email message so that it is professional. Explain: In 100 words or more, explain 2-3 tools...
-
Dara's Deals, LLC uses accrual accounting. In January the company purchased 500 phone cases at a cost of $6.00 per case. During January the company sold 300 of the cases for $15.00 per case. All...
-
Writea650-to700-wordpaperonthesubjectofvisualarts,inwhichyoudefinethepurposeandlanguageofthevisualarts.Imaginethatyourpaperonvisualartsistobeincludedinauniversitywebsiteonarthistoryandartappreciationt...
-
What are the various ways salespersons classify their customers or divide their territory?
-
Should we separate the debt and equity features of convertible debt? Team 1: Pro separation: Present arguments in favor of separating the debt and equity features of convertible debt. Team 2: Against...
-
The 68020's CHK2 and CMP2 instructions are rather nice because they let you compare a register against two bounds in order to perform array subscript checking at run time. Unfortunately, they are...
-
Shatin Intl. has 10 million shares, an equity cost of capital of 13% and is expected to pay a total dividend of $20 million each year forever. It announces that it will increase its payout to...
-
Tolo Co. plans the following repurchases: $10 million in one year, nothing in two years, and $20 million in three years. After that, it will stop repurchasing and will issue dividends totaling $25...
-
What is the intuition behind the payback rule? What are some of its drawbacks?
-
1 ) Salem Co . has a year - end of December 3 1 and they are evaluating the cash flows of some potential investments / projects they are considering for their next fiscal year, starting January 1 ....
-
Find the amount accumulated FV in the given annuity account. ( Assume end - of - period deposits and compounding at the same intervals as deposits. Round your answer to the nearest cent. ) $ 2 , 6 0...
-
Which project phase includes creative thinking to identify any broad potential risks and their likelihood? A Closeout B Execution ( C ) Planning D ) Initiation
Study smarter with the SolutionInn App