Actual margin and rate of return for this investment

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Reference no: EM131859483

1. You opened a brokerage account and purchased 300 shares of BBY for $27 per share and deposit initial margin of 55% the next dav. BBY’s price drops to $52 per share what are your actual margin and rate of return for this investment?

25.32% ; -8.77%

33% ; -8.77 %

42.31%; -15.95%

50.67%, -15.95%

55% ; -15.95%

2. Which one of the following statement regarding orders is false ?

A market order is an order to buy and sell a stock immediately at the current prevailing price

If stock AMG is trading at $121.39, a limit- buy order may instinct the broker to buy the stock if and when the share prices above $125.

A limit- sell order is where investors specify prices at which they are willing to sell a security.

A stop – buy order is an order to buy a stock if and when they share price rises above a preset limit.

If stock MCD is trading at $156.79 A stop loss order may instruct the broker to sell the stock if and the share price falls to or below $145.

Reference no: EM131859483

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