Total amount that you made, Accounting Basics

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Total amount that you made

Problem:

Suppose you sell short 75 shares of a stock initially selling for $95. Your margin requirement is 100%.

Required:

Question 1: What is the value of the 75 shares of stock (this is the amount you will borrow a Time 0)?

Question 2: If the stock price drops to $80 per share, what is the new value of the 75 shares of stock (this is the amount you will pay back at Time 1)?

Question 3: What is the total $ amount that you made (or lost) on the trade?

Question 4: What is your return?

Note: Explain all calculation and formulas.

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Accounting Basics: Total amount that you made

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Accounting Basics: Total amount that you made

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Accounting Basics: Total amount that you made

Reference No:- TGS0884426

Recent Questions Asked Accounting Basics

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Q : Maximum possible loss

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