You have been approached by a trader that requires assistance on margin-buying and short-selling on XYZ Ltd. He has provided you with the current Bid and Ask price of XYZ Ltd. as well as a forecast of the price in 1 month time (see table below). Assume a portfolio value/short position of R10 000.00: Bid price = $91.14 and Ask price = $92.05.

Question 1: Calculate the return assuming that shares are purchased on margin, where the margin amount is 80%, loan 20% and maintenance margin is 40%.

Question 2: Calculate the return assuming that shares are short-sold assuming an initial required margin of 40% and a maintenance margin of 25%.