Answered step by step
Verified Expert Solution
Question
1 Approved Answer
The stock price of Tesla is $668. Your broker charges a rate of 0.4% on borrowed shares. 1. You think the stock price will go
The stock price of Tesla is $668. Your broker charges a rate of 0.4% on borrowed shares.
1. You think the stock price will go down soon, and want to short 73 shares. If the initial margin is 50%, what is the minimum additional dollar amount that you have to deposit from your own funds to your brokerage account?
2. Three months later, the stock price is $695. Tesla paid a dividend of $6 per share during the three months you were short. What is your percentage margin (entered as a decimal number) at the end of three months?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started