Assume you buy 100 shares of stock at $40 per share on margin (40 percent). If the price rises to $55 per share, what is your percentage gain on the initial equity?
Answer to relevant QuestionsAl Rodriguez sells 500 shares of Gold Mine Corp. short at $80 per share. The margin requirement is 50 percent. The stock falls to $62 over a three-month time period, and he closes out his position. a. How much is his initial ...In problem 1, what would the percentage loss on the initial equity be if the price had decreased to $28? Gill Thomas is in the 35 percent tax bracket. Her long-term capital gains tax rate is 15 percent. She makes $16,200 on a stock trade. Compute her tax obligation based on the following holding periods: a. 6 months. b. 14 ...What is dollar-cost averaging? If you were a particularly astute investor at timing moves in the market, would you want to use dollar-cost averaging? Tom Aaron had 300 shares of the New Decade Fund on January 1. The shares had a value of $23. During the year he received $150 in dividends and $450 in capital gains distributions. He used the funds to purchase shares at an ...
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