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Suppose you sell short 200 shares of BP ADR currently selling at $40 per share. You give your broker $5000 to establish your margin account.
Suppose you sell short 200 shares of BP ADR currently selling at $40 per share. You give your broker $5000 to establish your margin account. You have no interest on the funds in your margin account. Assume that BP also has paid a year-end dividend of $0.5 per share, what will be your rate of return after one year if the BP price is $ 43. (please keep three decimal places, such as 0.031, NOT 3.1%)
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