If you bought GM at $20.00 and sold it at $40.00, what is your dollar profit or loss per share (ignoring transaction costs)? What is your holding period return?

b. Now assume that you posted 50 percent margin and borrowed the balance for each share you bought. What is your holding period return for each share?

 

c.  If the brokerage firm required a 35 percent maintenance margin, at what price would you receive a margin call from your broker?

 

 d. Assume you receive the margin call AT the price you calculated.Describe, precisely, the options your broker will offer you. Be very $pecific.

 

 e. Can you trade any listed stock using a broker's margin?

Answer rating: 100% (QA)

a If you bought GM at 2000 and sold it at 4000 your dollar profit per share would be 4000 2000 2000 ... View the full answer