One year ago, an investor is quoted the following prices for…
One year ago, an investor is quoted the following prices for ABC stock: Bid: $18.15 Ask: $18.35 During the year, ABC paid $0.95 in dividends. Today, the best price quotes for the stock are: Bid: $19.00 Ask: $19.35 Ignoring taxes, what return did the investor earn over the last year?
Read DetailsSuppose that you just short sold 100 shares of ABC stock for…
Suppose that you just short sold 100 shares of ABC stock for $45 per share. The initial margin requirement is 60%, which you cover by pledging T-bills as collateral. If the price of the stock falls to $38 per share, what return did you earn? Ignore the interest earned on T-bills.
Read DetailsChallenge The national order book for shares of ABC Corp. is…
Challenge The national order book for shares of ABC Corp. is: National Order Book Asks /Limit Sell Orders Price Shares Dealer Ask $99 3,600 $98 900 $97 720 $96 180 Best Ask $95 72 Bids /Limit Buy Orders Price Shares Best Bid $93 15 $92 38 $91 150 $90 188 Dealer Bid $89 750 Suppose a market order to sell 300 shares arrives from a fund manager. At what weighted-average price will this order be filled? (note: this spreads are unrealistically large. In reality, they would be $0.01) Enter your answer as a number of dollars, rounded to the nearest $0.01.
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