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Suppose that you have $100 in bank deposit (and no other wealth) on Sep 30. You buy 2 shares of stock A and short-sell 4
Suppose that you have $100 in bank deposit (and no other wealth) on Sep 30. You buy 2 shares of stock A and short-sell 4 shares of stock B at the close of the market on Sep 30. You close your position at the close of the market on Oct 31. Calculate the rate of return to your long-short investment, including the interest paid to your deposit, using the following information.
Q4. Suppose that you have $100 in bank deposit (and no other wealth) on Sep 30. You buy 2 shares of stock A and short-sell 4 shares of stock B at the close of the market on Sep 30. You close your position at the close of the market on Oct 31. Calculate the rate of return to your longshort investment, including the interest paid to your deposit, using the following information. interest rate on bank deposit: 1% per monthStep by Step Solution
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