A B C D Stock Edita Telecom Egypt CIB Remco Price on April 7 th 8 EGP 14 8 EGP 70 25 EGP 3 09 EGP Anticipated price on July 7th 11 35 EGP 11 25 EGP 55 75 EGP 4 13 EGP Dividends during period 2 EGP per share zero 3 EGP per share zero Number of shares invested 100 80 50 100 Given the prices and anticipated prices for the above stocks in the Egyptian stock market and apply the following What position would the investor take on each of the stocks and why (2 marks) Depending on the chosen position and including the rest of the given data what would the profit loss of the investor be for each stock on July 7 th when the position is closed out (6 marks) What is the total profit loss on this investors portfolio all together in July, if these prices are actually realized (2 marks) Assume that the investor chooses to hold stock A longer The investor has a margin account, where the maintenance margin is 30 , initial margin is 45 Suppose that the price of the stock then declines by 10 Would the account then be restricted Explain your answer and what that would mean (3 marks) Does your account require a margin call if not, then at what price would a margin call be required If YES move on to part C (2 marks here or at c) If your account now requires margin call then how much cash would you need to add An investor is considering to take a short position in the CIB stock After analyzing the market to take a decision the investor found the average daily trading on CIB to be 2,640 while the long trade positions are 1,082 Should the investor go ahead with this short sale or not Support your answer quantitatively and with an explanation (3 marks) If an Egyptian investor who is in the 21 tax percentile, is looking to invest in either a listed bond in EGX or an unlisted bond that he would purchase over the counter If the yield on the listed bond is 4 while the yield on the bond that is unlisted is 4 75 , which bond should the investor choose and why Show your calculations and explain your answer (4 marks) Why is it hard for individuals to invest in money markets Who are money markets more feasible for Explain your answer (2 marks) Suppose there are three investors John Doesnt not like to take risk, would seek as low as possible risk Matt Would take risk but prefers to keep it to a level that has certainty Jessy Is a big risk taker If these three investors were each offered to either invest in commercial papers, government bonds or common stocks, which security would each one choose and why (3 marks) a) What type of order would an investor make if he owns some stocks and wants to ensure their sale on April 15 th Explain your answer b) What type of order would an investor engage in if he took a short position in a stock at $47 and is looking to lock is a profit of no less than $5 Explain you answer (3 marks)

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A B C D Stock Edita Telecom Egypt CIB Remco Price on April 7 th 8 EGP 14.8 EGP 70.25 EGP 3.09 EGP Anticipated price

	A	B	C	D
Stock	Edita	Telecom Egypt	CIB	Remco
Price on April 7^th	8 EGP	14.8 EGP	70.25 EGP	3.09 EGP
Anticipated price on July 7th	11.35 EGP	11.25 EGP	55.75 EGP	4.13 EGP
Dividends during period	2 EGP per share	zero	3 EGP per share	zero
Number of shares invested	100	80	50	100

Given the prices and anticipated prices for the above stocks in the Egyptian stock market and apply the following:

What position would the investor take on each of the stocks and why? (2 marks)
Depending on the chosen position and including the rest of the given data what would the profit/loss of the investor be for each stock on July 7^th when the position is closed out? (6 marks)
What is the total profit/loss on this investors portfolio all together in July, if these prices are actually realized? (2 marks)

Assume that the investor chooses to hold stock A longer. The investor has a margin account, where the maintenance margin is 30%, initial margin is 45%. Suppose that the price of the stock then declines by 10%.

Would the account then be restricted? Explain your answer and what that would mean. (3 marks)
Does your account require a margin call if not, then at what price would a margin call be required? If YES move on to part C (2 marks here or at c)
If your account now requires margin call then how much cash would you need to add?

An investor is considering to take a short position in the CIB stock. After analyzing the market to take a decision the investor found the average daily trading on CIB to be 2,640 while the long trade positions are 1,082. Should the investor go ahead with this short sale or not? Support your answer quantitatively and with an explanation (3 marks).

If an Egyptian investor who is in the 21% tax percentile, is looking to invest in either a listed bond in EGX or an unlisted bond that he would purchase over the counter. If the yield on the listed bond is 4% while the yield on the bond that is unlisted is 4.75%, which bond should the investor choose and why? Show your calculations and explain your answer (4 marks).

Why is it hard for individuals to invest in money markets? Who are money markets more feasible for? Explain your answer (2 marks).

Suppose there are three investors:

John: Doesnt not like to take risk, would seek as low as possible risk

Matt: Would take risk but prefers to keep it to a level that has certainty

Jessy: Is a big risk taker

If these three investors were each offered to either invest in commercial papers, government bonds or common stocks, which security would each one choose and why (3 marks)?

a) What type of order would an investor make if he owns some stocks and wants to ensure their sale on April 15^th? Explain your answer.

b) What type of order would an investor engage in if he took a short position in a stock at $47 and is looking to lock is a profit of no less than $5? Explain you answer (3 marks).