Let’s say a financial institution buys 1,000 shares at $10/sh. If they borrow the maximum amount allowed, how much will the equity portion of the purchase be and how much will be the debit balance?

In the above example, how much would the interest be on the account calculated as the base rate plus 1.825%. The current base rate is 12%. The offset or premium depends on the size of the loan.

In this example, a financial institution buys 100,000 shares at $10/sh. The base rate is still 12% but the offset (for this large order) is 2%. How much will the interest rate be?

Answer rating: 100% (QA)

The amount of the loan is equal to the number of shares multiplied by ... View the full answer