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The bid and offer orders of XYZ stock are shown in the table below.+ Bid Number of shares Price per share Offer Number of sharese
The bid and offer orders of XYZ stock are shown in the table below.+ Bid Number of shares Price per share Offer Number of sharese 97,000- 33,000- 52,000+ + 2 $8.552 $8.542 $8.534 $8.522 $8.514 $8.50- + 2 + 46,000+ 84,000+ 65,000- The last executed price was $8.52. + 13 + t t Peter places the following orders to his stock broker. Order 1: Buy 50,000 shares of XYZ at $8.55 per share. Order 2: If order 1 is executed, then place an order to sell 50,000 shares of XYZ stocks at $9.00 per share. Order 3: If order 1 is executed, then place an order to sell 50,000 shares of XYZ stocks at $8.00 per share. Conditions: If order 2 is triggered (executed), cancel order 3.- If order 3 is triggered (executed), cancel order 2.- A What type of order (market buy/sell, limit buy/sell or stop buy/sell) is order 1? Explain.- B. What type of order (market buy/sell, limit buy sell or stop buy/sell order) is order 2? Explain. C. What type of order (market buy/sell, limit buy/sell or stop buy/sell order) is order 3? Explain. + + t t D. What view (price should rise, fall or remain unchanged) does Peter most likely have on stock XYZ? Explain. What is the logic/reason behind the way Peter places the 3 orders? t E. Calculate the profit/loss (in dollar amount) if orders 1 and 2 are triggered. t F. Calculate the profit/loss (in dollar amount) if orders 1 and 3 are triggered. + t
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