The profit calculation in the chapter assumes that you borrow at a fixed interest rate to finance

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The profit calculation in the chapter assumes that you borrow at a fixed interest rate to finance investments. An alternative way to borrow is to short-sell stock. What complications would arise in calculating profit if you financed a $1000 S&R index investment by shorting IBM stock, rather than by borrowing $1000?
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Derivatives Markets

ISBN: 9789332536746

3rd Edition

Authors: Robert McDonald

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