Question
You sell 100 shares of a stock short at a price of $70 per share. a. Provide an example of a limit order you might
You sell 100 shares of a stock short at a price of $70 per share.
a. Provide an example of a limit order you might place right after you took the position and indicate how it would work.
b. Provide an example of a stop order you might place right after you took the position and indicate how it would work.
c. After three months, the stock is selling for $64 per share. During the three months you have had the short position the stock paid a dividend of 50 cents per share. What is your total dollar gain or loss on the short position over the three months? (Don't worry about any margin interest.)
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