What is his percentage return

Assignment Help Accounting Basics
Reference no: EM133027257

Question - In November an investor wishing to utilize a hedging technique creates a covered call position as follows: He purchases 400 shares stock at $42 and simultaneously sells 3 February 47 1/2 calls at $2.25.

In January the stock is trading at $46 and the calls at $2.75. The investor decides to "unwind" his position and liquidate all shares owned. Ignoring commissions, what is his percentage return?

Reference no: EM133027257

Questions Cloud

Implementation of a training program : What information does a needs analysis provide and how can it help in deciding the type of training that is needed?
How would you create a retirement forecast : They would like to retire at 50 with $2,500,000 in their retirement account. How would you create a Retirement forecast based on the above information
Analyze roger needs using maslow hierarchy : What do you see as the basic, underlying problem here? Analyze Roger's needs using Maslow's Hierarchy.
Determine the total cost that should have been recorded : Use this information to determine the total cost that should have been recorded in the Work in Process for Job A-1 on March 21
What is his percentage return : The investor decides to "unwind" his position and liquidate all shares owned. Ignoring commissions, what is his percentage return
Determine the minimum taxable income for each : For the taxation year ending December 31, 2020, the engineering services business had income of $21,250. Determine the minimum Taxable Income for each
Calculate LRI taxable income-loss : Management anticipates using all of the loss carry forwards within the allowable carry forward period. Calculate LRI taxable income-loss
How much simple interest did the account earn : Finally, on April 28th, she deposited $525.25. On April 30th, the bank calculated the interest for the month? How much simple interest did the account earn
Explain dominant images of change : What are your "dominant" images of change? (see question 1 on page 51)

Reviews

Write a Review

Accounting Basics Questions & Answers

  What income tax due of the corporation is

What Income tax due of the corporation is? A Corporation engaged in business in the Philippines and abroad has the following data in 2020

  What are the four principles of risk assessment

What are the four principles of risk assessment? What is meant by "introducing risk and return"? How does it minimize internal control risks?

  Determining the effect of positive change

What McDonald's should do is go all in and really transform itself, because the effect of positive change would be immeasurable. Instead it tries to play it both ways, controlling what franchisees buy and sell but insisting that it cannot dictate ..

  Prepare a performance report for all costs

Prepare a performance report for all costs, showing flexible budget variances (indicate F or U).

  Prepare the entry to record issuance of the note

Sylvestor Systems borrows $95,000 cash on May 15 by signing a 120-day, 6%, $95,000 note. Prepare the entry to record issuance of the note

  Why determination of materiality is matter of auditor

Explain why determination of materiality is a matter of auditor judgment. Refer to both qualitative and quantitative materiality assessments

  Determine the functional currency of Koala Ltd

The subsidiary operates within India and sells its goods and purchases its raw materials in India. Determine the functional currency of Koala Ltd

  Which terms would fit the note receivable

The accrued interest receivable for eight months was reported as a current asset. Which of the following terms would fit the note receivable?

  Determine multiple-step income statement for company

In its income statement for the year ended December 31, 2017, Darren Company reported the following condensed data.

  Determine the balance in the warranty liability account

Prepare journal entries that summarize the sales and any aspects of the warranty for 2021.b)Determine the balance in the Warranty Liability account

  Wealthy aunt has just established a trust fund

Wealthy aunt has just established a trust fund

  What is the relevant assertion at risk of misstatement

Based upon the risk factors discussed what is the relevant assertion at risk of misstatement for accounts payable? Explain why

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!

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