User Account

All Pages

How much money will you have to place in your margin account

Assignment Help Accounting Basics
Reference no: EM132539379

Question - XYZ Ltd is selling at K45 a share. You would like to buy 200 shares for your preferred price of K42 a share using 60% margin. XYZ pays no dividends and the interest rate on a margin loan is 6%. You have two types of orders at your disposal: Limit buy order and Stop loss order

A. Which of the two types of orders would you place to buy XYZ at your preferred price?

B. Assuming your order in part A gets executed, how much money will you have to place in your margin account?

C. Which of the two types of orders would you place after buying XYZ in order to ensure that the shares are sold if they drop to K35?

D. With the price drop to K35 calculate the return on your investment following a sale at this price.

E. Describe two (2) characteristics of a good market.

Reference no: EM132539379

Questions Cloud

Define main reasons for the recent popularity of data mining : What are the main reasons for the recent popularity of data mining? Discuss what an organization should consider before making a decision to purchase data.
What is the required Journal Entry : The payment includes interest at 6% per annum, which is the market rate of interest for loans of this nature. What is the required Journal Entry
Did drizin act ethically in the case : Did Drizin act ethically in this case? Did the owners of Northwest Iowa Ethanol have any responsibility for the losses they suffered in this case? Explain.
Evaluate the current ethical and legal concerns : Evaluate the current ethical and legal concerns surrounding your topic. Select one ethical or legal concern surrounding your topic, take a position on the issue
How much money will you have to place in your margin account : XYZ pays no dividends and the interest rate on a margin loan is 6%. How much money will you have to place in your margin account
8d problem solving framework : How would you use the 8D problem solving framework to address this issue?
Explain the organization reporting of pledges : Compare the organization's reporting of pledges and contributions with its reporting of exchange transactions. Discuss the funds that are utilized.
What are the ethical concerns raised by employees : Take a position on the ethical concerns raised by employees who are upset about organizations monitoring their email or Internet access for security purposes.
What is involved in a competitor analysis : For a business to be successful, it must constantly be comparing itself to its competitors in order to find some kind of advantage. Which key questions

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Theory of interest - term structure of interest rates

Term Structure of Interest Rates

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd