Reference no: EM132890437
Chapter 3- Securities Markets
For the 11th version of the textbook:
1. Read section 3.2 ‘How Securities Are Traded'
- Describe one type of markets.
- Describe one type of orders.
2. Read section 3.7‘Trading Costs'
- Describe full-service and discount brokers.
- Look at the website of one discount broker (for example Schwab, E*Trade, or Ameritrade). What is the commission you have to pay for buying/selling stocks? bonds? or options?
3. Read section 3.9 ‘Short Sales'
- Describe the difference between buying stocks and short selling stocks? When would you do short sales?
- You sold short one stock of Google for $500. After one month Google price was $450 and during the month Google paid a dividend of $2. What was your profit? What if the Google's price was $550 at the end of the month?