Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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Question
You shorted a stock at $50 a share. If the maintenance margin is 35%, at what price level will you get a margin call?
Group of answer choices
A) $55.55
B) $57.50
C) $62.55
D) $60
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- Suppose you purchase 20 call contracts on SAMSONG Co. stock. The strike price is $120, and the premium is $8. If the stock is selling for $140, $128, $120 per share at expiration, what are your call options worth? What is your net profit?arrow_forwardBhaarrow_forwardYou establish a straddle on Walmart using September call and put options with a strike price of $97. The call premium is $7.85 and the put premium is $8.60. Required: a. What is the most you can lose on this position? (Input the amount as positive value. Round your answer to 2 decimal places.) b. What will be your profit or loss if Walmart is selling for $98 in September? (Input the amount as positive value. Round your answer to 2 decimal places.) c-1. What is the Break-even price for lower bound? (Round your answer to 2 decimal places.) c-2. What is the Break-even price for upper bound? (Round your answer to 2 decimal places.)arrow_forward
- If you have a margin account and your broker requires 40% initial margin, this means: a. borrow no more than 40% of the purchase price of the stock from your broker b. borrow no more than 60% of the purchase price of the stock from your brokerarrow_forwardVerify and answer my questionarrow_forwardWhat is the rate return when 30 shares of atock a purchase for $15/share, are sold for 480? The commission on the sale is $6arrow_forward
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