Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

I am having a really hard time with my investments homework. My textbook is no help. Q1. You sell 100 shares of a stock short

I am having a really hard time with my investments homework. My textbook is no help.

Q1. You sell 100 shares of a stock short at a price of $70 per share.

a. Provide an example of a limit order you might place right after you took the position and indicate how it would work.

b. Provide an example of a stop order you might place right after you took the position and indicate how it would work.

c. After three months, the stock is selling for $64 per share. During the three months you have had the short position the stock paid a dividend of 50 cents per share. What is your total dollar gain or loss on the short position over the three months? (Don't worry about any margin interest.)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Analytical Finance Volume I

Authors: Jan R. M. Röman

1st Edition

3319340263, 978-3319340265

More Books

Students also viewed these Finance questions

Question

List the steps involved in an open market sale of a new bond issue.

Answered: 1 week ago