Question
In: Finance
Assume that you use a TD Ameritrade brokerage account and placeyour stock trades through the...
Assume that you use a TD Ameritrade brokerage account and place your stock trades through the Interactive Voice Response (IVR) Phone System, which charges a $34.99 commission per stock trade. You would like to sell $1,500 shares of Microsoft Corporation, which is listed on the Nasdaq stock exchange, so you check the real-time quotes through TD Ameritrade and see bid price of $57.31 and an ask price $57.33.
QUESTIONS:
c. What are your total transaction cost if the Nasdaq dealer who receives your order decides to act as a broker and allows a public order to buy 1,500 shares of Microsoft to satisfy your order
d. Regardless of how your trade is executed, based on the bid/ask spread what is the market value of your trade?
Solutions
Expert Solution
c.
The total transaction cost is as follows:
d.
The market value of trade is as follows:
we use the ask price rather than bid price becuause for selling always ask price is used.
jeff jeffy answered 2 years agoRelated Solutions
Assume that you use a TD Ameritrade brokerage account and place your stock trades through the...
Assume that you use a TD Ameritrade brokerage account and place
your stock trades through the Interactive Voice Response (IVR)
Phone System, which charges a $34.99 commission per stock trade.
You would like to sell $1,500 shares of Microsoft Corporation,
which is listed on the Nasdaq stock exchange, so you check the
real-time quotes through TD Ameritrade and see bid price of $57.31
and an ask price $57.33.
a. What is the current bid/ask spread for Microsoft?
b. If you...
You Just a TD stock at $100 and a put option on the TD stock at $5....
You Just a TD stock at $100 and a put option on the
TD stock at $5. The put has exercise price of $108 and expiration
date is 6 months from now. Assume that the spot price of the TD
stock on expiration date turned to as follows (consider each case
separately):
Spot price at expiration
$85
$90
$95
$100
$105
$110
$115
$120
$125
$130
i. What will be value of put option expiration date under each
scenario.
ii. What...
You buy stock on margin in your brokerage account when it istrading at $37.21 per...
You buy stock on margin in your brokerage account when it is
trading at $37.21 per share. You have $3500 in equity (cash) in
your account and buy 155 shares.Your broker makes a margin loan so you can pay the difference at
an annual rate of 0.0825 One year later the stock price is
51.13What is the margin percentage in the account one year after the
trade is made?
You have opened a stock portfolio account with a brokerage firm. You have only purchased stocks...
You have opened a stock portfolio account with a brokerage firm.
You have only purchased stocks of Home Depot. You purchased 200
shares of HD at $178/share
a. Suppose you borrowed at the set initial margin of 50% (that
is you borrowed the maximum amount possible and invested the rest
from your own savings). How much did you invest?
You have opened a stock portfolio account with a brokerage firm. You have only purchased stocks...
You have opened a stock portfolio account with a brokerage
firm. You have only purchased stocks of Home Depot. You purchased
200 shares of HD at $178/share.
a. Suppose the initial margin requirement is 50%. What is the
maximum amount that you can borrow?
Brokerage Satisfaction with Trade Price Satisfaction with Speed of Execution Overall Satisfaction with Electronic Trades Brokerage...
Brokerage Satisfaction with Trade Price Satisfaction with Speed
of Execution Overall Satisfaction with Electronic Trades
Brokerage
Satisfaction with Trade Price
Satisfaction with Speed of Execution
Overall Satisfaction with Electronic Trades
AA
3.4
3.4
3.5
BB
3.2
3.3
3.4
CC
3.1
3.4
3.9
DD
2.9
3.6
3.7
EE
2.9
3.2
2.9
FF
2.5
3.2
2.7
GG
2.6
3.8
2.8
HH
2.4
3.8
3.6
II
2.6
2.6
2.6
JJ
2.3
2.7
2.3
KK
3.7
4.0
4.0
LL
2.5
2.5
2.5
MM
3.0...
1. Trades on the NYSE are generally completed by having a brokerage firm acting as a...
1. Trades on the NYSE are generally completed by having a
brokerage firm acting as a "dealer" buy securities and adding them
to its inventory or selling from its inventory. The NASDAQ, on the
other hand, operates as an auction market, where buyers offer to
buy, and sellers to sell, and the price is negotiated on the floor
of the exchange.
True or False
2.
Which of the following is an example of a capital market
instrument?
a.
Preferred stock....
You have $7,933.71 in a brokerage account, and you plan to deposit an additional $4,000 at...
You have $7,933.71 in a brokerage account, and you plan to
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your account totals $200,000. You expect to earn 14% annually on
the account. How many years will it take to reach your goal? Round
your answer to the nearest whole number.
You have $75,148.17 in a brokerage account, and you plan todeposit an additional $3,000 at...
You have $75,148.17 in a brokerage account, and you plan to
deposit an additional $3,000 at the end of every future year until
your account totals $270,000. You expect to earn 10% annually on
the account. How many years will it take to reach your goal? Round
your answer to the nearest whole number.
You have $51,106.03 in a brokerage account, and you plan to deposit an additional $3,000 at...
You have $51,106.03 in a brokerage account, and you plan to
deposit an additional $3,000 at the end of every future year until
your account totals $250,000. You expect to earn 10% annually on
the account. How many years will it take to reach your goal?
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