Question: you've just opened a margin account with $10,000 at your local brokerage firm. You instruct your broker to purchase 450 shares of Smolira Golf stock,

you've just opened a margin account with $10,000 at your local brokerage firm. You instruct your broker to purchase 450 shares of Smolira Golf stock, which currently sells for $38 per share. Suppose the annual call money rate is 6 percent and your broker charges you an annual spread of 1.23 percent over this rate. You hold the stock for six months and sell at a price of $46 per share. The company paid a dividend of $0.25 per share the day before you sold your stock.

What is your effectiveannualpercentagerate of return?

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!

Wells Technical Institute (WTI), a school owned by Tristana Wells, provides training to individuals who pay tuition directly to the school. WTI also offers training to groups in off-site locations....

You've just opened a margin account with $10,000 at your local brokerage firm. You instruct your broker to purchase 450 shares of Smolira Golf stock, which currently sells for $38 per share. Suppose...

You've just opened a margin account with $10,000 at your local brokerage firm. You instruct your broker to purchase 450 shares of Smolira Golf stock, which currently sells for $40 per share. Suppose...

You've just opened a margin account with $10,000 at your local brokerage firm. You instruct your broker to purchase 450 shares of Smolira Golf stock, which currently sells for $39 per share. Suppose...

You've just opened a margin account with $10,000 at your local brokerage firm. You instruct your broker to purchase 450 shares of Smolira Golf stock, which currently sells for $99 per share Suppose...

You've just opened a margin account with $10,000 at your local brokerage firm. You instruct your broker to purchase 450 shares of Smolira Golf stock, which currently sells for $41 per share. Suppose...

You've just opened a margin account with $11,000 at your local brokerage fi rm. You instruct your broker to purchase 600 shares of Smolira Golf stock, which currently sells for $46 per share. What is...

TUDJ u " WUI (Product Activation Failed REFERENCES MAILINGS REVIEW VIEW A A Aa A 5 5 ' = = 1. AaBb x? A ay. A = Heading 6 . E 21 A Paragraph Ravin Problems The Account Balance Sheet Suppose you want...

FIN 241 Buying and Selling Securities (Students) (6) - Word (Product Activation Failed) PAGE LAYOUT REFERENCES MAILINGS VIEW REVIEW -12 - Aa 1. AaBb Heading 6 Bbc T Nom X; x A . A . EL 21 T Font...

You've just opened a margin account with $14,000 at your local brokerage firm. You instruct your broker to purchase 700 shares of Landon Golf stock, which currently sells for $29 per share. a. What...

Use the data given in the previous exercise to complete the following: a. Estimate the mean difference in motion between dominant and nondominant arms for position players using a 95% confidence...

A cyclone has an inlet velocity of 70 ft. /s and a reported pressure loss of 8 velocity heads (K = 8). What is the pressure loss in pressure units?

ew Policies arrent Attempt in Progress A process cost accounting system is most appropriate when a variety of different products are produced, each one requiring different types of materials, labor,...

Ju Sanchez made a permanent move to Canada on 8/31/20, from Japan, where he owned the following (in Canadian Dollars): ACB 1/1/20 FMV 6/30/20 FMV 8/31/20 FMV 12/31/20 FMV Dwelling $185,000 $210,000...

Chipotle Mexican Grill, Inc. (NYSE: CGM ) is a publicly held corporation with more than $5 billion in assets. To follow are Chipotles four basic financial statements for its most recent year, the...

1. Draw triangle ABC so that angles A and B are both 42 degrees. Why should AB be longer than BC? Extend CB to E, so that CB = BE, Mark D on AB so that DB-BC then draw the line ED, which intersects...

1. Read the accounts receivable narrative (AR.1.1) and review the sales and accounts receivable flowchart (AR.1.2). Review the narrative and flowchart to identify all of the internal control...

A researcher said that in a certain city, 90% of adults are older than the average age of adults in the city. Discuss whether or not this is possible.

please answer it typing.. dont answer it handwriting.. discuss the answer broadly. Scopes of Management, Managerial Roles, Skills and Levels, Management Challenges 15 points

1. Identify your reference point when making a decision based on an element of risk.

3. If there are reasonable alternatives, think about your decisions based on the different reference points and see if there are any contradictions in the decisions.

4. It is only at this point that you can give the problem your full attention in relation to the various ways you have framed the problem.