Suppose Josh gets a $7500 gift from his family on graduation & wants to buy securities with this. He talks to his broker who informs him that the initial (minimum) margin requirement to be 25%. He, however, decides to use his entire gift to buy only 150 shares in HSBC at an initial price of $100 each. (a) What is the initial percentage Margin on Josh's account? (b) If R is Josh's portfolio return, and R= A.RHSBC, where RHSBC is HSBC's return, what is A? (c) If HSBC's beta is 0.975, what is the beta of Josh's portfolio?
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- Rob has deposited K40,000 in his margin account and he wants to use the money to buy shares of the ABC company. The initial margin requirement is 40% and ABC’s stock price is currently K50. Ignore taxes, commissions and interest on the amount borrowed. What is Rob’s percentage return if he buys the stock on margin and the price increases to K55? And If the maintenance margin is 30%, at what price would Rob receive a margin call from his broker?Rob has deposited K40,000 in his margin account and he wants to use the money to buy shares of the ABC company. The initial margin requirement is 40% and ABC’s stock price is currently K50. Ignore taxes, commissions and interest on the amount borrowed How many shares of ABC can Rob buy from his margin account?Claire Gerber wants to buy 100 shares of Google, which is selling in the market for $548.66 a share. Rather than liquidate all her savings, she decides to borrow through her broker at 5 percent a year. Assume that the margin requirement on common stock is 50%. If the stock rises to $625 a share over the next year, calculate the dollar profit and percentage return that Claire would earn if she makes the investment with 50% margin. Contrast these figures to what she'd make if she uses no margin. Calculate the dollar net profit. Round the answers to the nearest dollar. Without Margin With 50% Margin Calculate the return on investment. Round the answers to two decimal places. Without Margin With 50% Margin
- Elizabeth Greene wants to buy 300 shares of Google, which is selling in the market for $533.14 a share. Rather than liquidate all her savings, she decides to borrow through her broker at 5 percent a year. Assume that the margin requirement on common stock is 50 percent. If the stock rises to $630 a share over the next year, calculate the dollar profit and percentage return that Elizabeth would earn if she makes the investment with 50 percent margin. Contrast these figures to what she'd make if she uses no margin. Assume there is no opportunity cost for Elizabeth's savings. Calculate the dollar net profit. Round the answers to the nearest dollar. Without Margin With 50% Margin $ $ Calculate the return on investment. Round the answers to two decimal places. Without Margin With 50% MarginKim opens a brokerage account and purchases 500 shares of Batliboy at OMR50 per share. She borrows OMR5,000 from her broker to help pay for the purchase. The interest rate on the loan is 7% What is the margin in Kim's account when she first purchases the stock If the share price falls to OMR40 per share by the end of the year, what is the remaining margin in her account? If the maintenance margin requirement is 30%, will she receive a margin call? What is the rate of return on her investment?Kim opens a brokerage account and purchases 500 shares of Batliboy at OMR50 per share. She borrows OMR5,000 from her broker to help pay for the purchase. The interest rate on the loan is 7% What is the margin in Kim's account when she first purchases the stock If the share price falls to OMR40 per share by the end of the year, what is the remaining margin in her account? If the maintenance margin requirement is 30%, will she receive a margin call? What is the rate of return on her investment? (The first question been solved, I need answer for second and third questions)
- Anne has €60,000 in cash that she plans to invest in Apple stock, which is currently selling at €50 per share. She plans to buy the stock on margin by borrowing 40% of the total investment from her broker, How many shares of Corning will she purchase?Dée Trader opens a brokerage account and purchases 300 shares of Internet Dreams at $40 per share. She borrows $4,000 from her broker to help pay for the purchase. The interest rate on the loan is 8%.a. What is the margin in Dée’s account when she first purchases the stock?b. If the share price falls to $30 per share by the end of the year, what is the remaining margin in her account? If the maintenance margin requirement is 30%, will she receive a margin call?c. What is the rate of return on her investment?Barbara buys 130 shares of DEM at $34.00 a share and 190 shares of GOP at $37.00 a share. She buys on margin and the broker charges interest of 6 percent on the loan. If the margin requirement is 43 percent, what is the maximum amount she can borrow? Round your answer to the nearest cent. $ If she buys the stocks using the borrowed money and holds the securities for a year, how much interest must she pay? Round your answer to the nearest cent. $ If after a year she sells DEM for $25.00 a share and GOP for $30.00 a share, how much did she lose on her investment? Use a minus sign to enter the amount as a negative value. Round your answer to the nearest cent. $ What is the percentage loss on the funds she invested if the interest payment is included in the calculation? Use a minus sign to enter the amount as a negative value. Round your answer to two decimal places.
- Dée Trader opens a brokerage account and purchases 100 shares of Internet Dreams at $58 per share. She borrows $2,200 from her broker to help pay for the purchase. The interest rate on the loan is 12%. Required:a. What is the margin in Dée’s account when she first purchases the stock? b. If the share price falls to $48 per share by the end of the year, what is the remaining margin in her account? c. If the maintenance margin requirement is 30%, will she receive a margin call?multiple choice Yes No Correct d. What is the rate of return on her investment? (Negative value should be indicated by a minus sign. Round your answer to 2 decimal places.) Dée Trader opens a brokerage account and purchases 100 shares of Internet Dreams at $58 per share. She borrows $2,200 from her broker to help pay for the purchase. The interest rate on the loan is 12%. Required:a. What is the margin in Dée’s account when she first purchases the stock? b. If the share price falls to…Dée Trader opens a brokerage account and purchases 100 shares of Internet Dreams at $58 per share. She borrows $2,200 from her broker to help pay for the purchase. The interest rate on the loan is 12%. Required:a. What is the margin in Dée’s account when she first purchases the stock? b. If the share price falls to $48 per share by the end of the year, what is the remaining margin in her account? c. If the maintenance margin requirement is 30%, will she receive a margin call?multiple choice Yes No d. What is the rate of return on her investment? (Negative value should be indicated by a minus sign. Round your answer to 2 decimal places.)(a). An investor who is in the 28 % tax bracket is considering choosing between an investment earning a 6 % taxable return and an investment earning a 4 % tax-free yield. Advise the investor which investment he should choose and give reasons. (b) If you buy 100 common shares of ZANACO Plc, to what are you entitled? (c) What is the most money you could make over the next year? (d) If you pay K95 per share, what is the most money you could lose over the year? (e) Stock Initial Price Final Price Shares (millions) ABC K25 K30 20 XYZ K100 K90 1 (1) Determine the portfolio initial…