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What is the long-position profit or loss? What is the breakeven point of the call option?
Shirley McCain is a regular commodities speculator. She is currently considering a short position in August fine wool, which is now trading at 1245.
Assume she short sells three contracts at 4724 and has to make a margin deposit of $7000 for each contract.
If each contract required a margin deposit of $7000, how much money would she need to set up this hedge?
What would this futures contract be quoted at if Vincent is right and the yield goes up by 0.5%?
What is the purchase price of the greasy wool commodity contracts you control according to the June settlement date?
As an investor, why would you choose a convertible preference share over a straight preference share?
What usually happens when a company passes a dividend on a cumulative preference share?
What will the new market price on the issue be if the share's dividend yield holds at 9%?
The Granger Company has 500 000 $2 preference shares outstanding. It generates an EBIT of $40 million and has annual interest payments of $2 million.
You purchased 100 $2 preference shares one year and one day ago for $25 per share. You sold them today for $30 per share.
Use one of the dividend valuation models to price this share, assuming you have a 7.5% required rate of return.
A bond is currently selling in the market for $1170.68. It has a coupon of 12% and a 20-year maturity. Using annual compounding, calculate the promised yield.
Find the current yield, YTM and YTC on this issue, given that it is currently being priced in the market at $1200.
Assume that an investor is looking at two bonds. Bond A is a 20-year, 9% bond that is priced to yield 10.5%.
A zero-coupon bond that matures in 15 years is currently selling for $209 per $1000 par value. What is the promised yield on this bond?
Find the current yield and the promised yield of this issue, given that the bond has a par value of $1000.
What would the holding period return be if he were able to sell the bond (at $950) after only nine months?
Fnd the yield-to-maturity for each of the following bonds, A 9.5%, 20-year bond priced at $957.43, A 16%, 15-year bond priced at $1684.76
A bond has a Macaulay duration equal to 9.5 and a yield to maturity of 7.5%. What is the modified duration of this bond?
An investor wants to find the duration of a 25-year, 6% semi-annual-pay, non-callable bond that's currently priced in the market at $882.72, to yield 7%.
Find the Macaulay duration and the modified duration of a 20-year, 10% corporate bond priced to yield 8%.
If Mary's expectations are correct, what will the price of this bond be in two years?
One of the bond issues outstanding by H&W Ltd has an annual-pay coupon of 5.625% plus a par value of $1000 at maturity.
Find the investor's holding period return, given that this fund now has a net tangible asset value of $9.10.