Question
A. You are bullish on Curious Inc. stock and decide to purchase 200 shares at $30 per share. To do the transaction, you borrowed $2,600
A. You are bullish on Curious Inc. stock and decide to purchase 200 shares at $30 per share. To do the transaction, you borrowed $2,600 from your broker on 6% interest. What is the remaining margin on your account, if the share price drops to $17.9 a year later?(Provide your answer in % rounded to two digits omitting the % sign)
B. You have put down $600 and borrowed $400 in order to purchase 20 shares in a company trading at $50 per share. The next day the share price drops unexpectedly to $32. How many shares do you have to sell (in order to pay down part of your loan) to restore the percentage margin to 60%?
C. Suppose you short sell 100 shares of MSFT, now selling at $52 per share. Theoretically, your maximum possible loss is _____ while your maximum possible gain is _______?
D. You have sold short 40 shares of company LOL at $82. Your initial margin is 50% and your maintenance margin is 30%. A few weeks later, just after the company paid $2 dividends, you hit the maintenance margin (exactly) and receive a margin call. How much money do you have to add to your account to bring the margin back to the initial level?
E. A market buy order will be matched with...
(A) The lowest available limit buy order (B)the lowest available limit sell order (C)the highest available limit buy order (D)the highest available limit sell order
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