Josh Rink considers himself a shrewd commodities investor. Not long ago he bought one July cotton contract at $0.54 a pound and he recently sold it at $0.58 a pound. How much profit did he make? What was his return on invested capital if he had to put up a $1,260 initial deposit?
Answer to relevant QuestionsWhat makes an asset liquid? Why hold liquid assets? Would 100 shares of IBM stock be considered a liquid investment? Explain. Describe the structure of the overall investment process. Explain the role played by financial institutions and financial markets. Not long ago, Vanessa Woods sold her company for several million dollars (after taxes). She took some of that money and put it into the stock market. Today Vanessa’s portfolio of blue-chip stocks is worth $3.8 million. ...You decide to act on your hunches about feeder cattle, so you purchase 4 contracts for April delivery at 88.8. You are required to put down 10%. How much equity/capital did you need to make this transaction? Jim Pernelli and his wife, Polly, live in Augusta, Georgia. Like many young couples, the Pernellis are a 2-income family. Jim and Polly are both college graduates and hold high-paying jobs. Jim has been an avid investor in ...
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