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Suppose you have $2,000 in your E*Trade account. You sell short some Intel shares and receive $1500 in cash. Determine your portfolio weight W intel
Suppose you have $2,000 in your E*Trade account. You sell short some Intel shares and receive $1500 in cash. Determine your portfolio weight Wintel and Wcash. Note that Intel's portfolio weight becomes negative after the short selling.
You represent this position as follows:
Wcash | Wintel | |
Initial Position | 1 | 0 |
After short selling | 1.75 | -0.75 |
is this true or false?
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