Question: Initial Margin = 60% Maintenance Margin = 40% Initial Price = $120 Expected Dividend = $2 1) You bought the stock on margin with the

Initial Margin = 60% Maintenance Margin = 40% Initial Price =

Initial Margin = 60%

Maintenance Margin = 40%

Initial Price = $120

Expected Dividend = $2

1) You bought the stock on margin with the broker. At the end of 180 days the stock is selling for $116 and you received the $2 dividend. What is your HPR? What is your effective annual return on this investment? What is your new margin level? When (i.e. the new price level) will you get a margin call?

Initial Margin = 60% Maintenance Margin = 40% Initial Price = $120 Expected Dividend = $2 1) You bought the stock on margin with the broker. At the end of 180 days the stock is selling for $116 and you received the $2 dividend. What is your HPR? What is your effective annual return on this investment? What is your new margin level? When (i.e. the new price level) will you get a margin call

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

Initial Margin = 60% Maintenance Margin = 40% Initial Price = $120 Expected Dividend = $2 1) If you shorted the stock on margin. Again, at the end of 180 days the stock is selling for $116 and the $2...

Show all mathematical steps and formulas necessary to solve the problem. Use LaTeX to demonstrate the math steps. Do not use excel or any programming language to solve it. Given: - A companies stock...

How much can stock price fall before you get a margin call? You have $6,000 to invest Share price: $100 Initial Margin: 60% Maintenance Margin: 40\% Shares Purchased: 100 (at $100 per share) Initial...

a. Say you buy 87 shares of GS for $164 per share on 70% initial margin. The maintenance margin is 30%. What is the highest stock price at which you would receive a margin call? $65.28 $70.29 $82.005...

HSBC shares are currently trading at $50 per share and your friend told you that the HSBC share price would increase significantly in the near future. At the most, you can only put $100,000 to this...

1)Petro Asia Inc. opened an account with Fista Broker to short-sell 2,000 shares of Maya Inc at $40. Fista required 50% initial margin. A year later, Mayas share price rises to $50 and the stock has...

(a) Petro Asia Inc. opened an account with Fista Broker to short-sell 2,000 shares of Maya Inc at $40. Fista required 50% initial margin. A year later, Maya's share price rises to $50 and the stock...

Customer X opened a margin account at a local brokerage firm. Xs initial investment was to purchase 200 shares of MGROS on margin at 40 TL per share. X borrowed 4,000TL from broker to complete the...

What are the three types of marketing research? Indicate which type each item in the list below illustrates. Explain your answer. a. Establishing the relationship between advertising and sales in the...

The one-year interest rate in Singapore is 11 percent. The one-year interest rate in the United States is 6 percent. The spot rate of the Singapore dollar (S$) is $.50 and the forward rate of the S$...

Operating cash flows include which of the following? Multiple Choice Cash recelved from the sale of a used company truck Cash recelved from the issuance of common stock Cashrecelved from a bank loan....

Empathy is the ability to put yourself in someone else's shoes and understand how they feel. True False QUESTION 4 8

5. List the forces that shape a groups decisions

4. Identify how culture affects appropriate leadership behavior

3. Identify the qualities that make leaders effective at enacting change