At the beginning of the month, you sell short 200 shares of Wells Fargo that are...

At the beginning of the month, you sell short 200 shares of Wells Fargo that are currently selling at $45 per share. One month later you cover your short position at $52 per shares. During the month, Wells Fargo issued $2 dividend per share. What is you return during this month?

		-0.200
		0.200
		-0.156
		-0.111
		0.111

Expert Solution

The return will be calculated as

Return = (45 - 52 - 2)/45 = - 20%

Hence, option A is correct.

jeff jeffy answered 3 years ago

At the beginning of the month, you sell short 200 shares of Wells Fargo that are currently selling at $45 per share.

At the beginning of the month, you sell short 200 shares of Wells Fargo that are currently selling at $45 per share. One month later you cover your short position at $52 per shares. During the month, Wells Fargo issued $2 dividend per share. What is you return during this month?-0.2000.200-0.156-0.1110.111

wells fargo Equity Research 1. what is wells fargo industry overview 2. what is wells fargo...

wells fargo Equity Research 1. what is wells fargo industry overview 2. what is wells fargo competitive positioning

You sell short 400 shares of Apple that are currently selling at $200 per share. You...

You sell short 400 shares of Apple that are currently selling at $200 per share. You post the 60% margin required on the short sale, and the maintenance margin requirement is 25%. At what price would you receive a margin call (assume the margin call happens immediately). $240 $248 $256 $260 None of the above You short-sell 10 shares of Amazon.com, Inc today. The stock price is $2,000 per share. What is your maximum possible gain of this trade when...

You decide to sell short 200 shares of Charlotte Horse Farms when it is selling at...

You decide to sell short 200 shares of Charlotte Horse Farms when it is selling at its yearly high of $51. Your broker tells you that your margin requirement is 65 percent and that the commission on the purchase is $330. While you are short the stock, Charlotte pays a $2.35 per share dividend. At the end of one year, you buy 200 shares of Charlotte at $36 to close out your position and are charged a commission of $320...

Wells Fargo and Moral Emotions On September 8, 2016, Wells Fargo, one of the nation’s oldest...

Wells Fargo and Moral Emotions On September 8, 2016, Wells Fargo, one of the nation’s oldest and largest banks, admitted in a settlement with regulators that it had created as many as two million accounts for customers without their permission. This was fraud, pure and simple. It seems to have been caused by a culture in the bank that made unreasonable demands upon employees. Wells Fargo agreed to pay $185 million in fines and penalties. Employees had been urged to...

You sell short 200 shares at $50 per share. You post the 50% margin required for...

You sell short 200 shares at $50 per share. You post the 50% margin required for the short sale. Assume you earn no interest on your margin funds, nor pay any interest on the loan of shares. The company stock pays dividends of $0.33 per share every quarter. What is your rate of return on this position, if you close it out at $42 per share after one year? Enter answer in percents, accurate to 2 decimal places.

Suppose you short-sell 100 shares of IBM, now selling at $200 per share.

Suppose you short-sell 100 shares of IBM, now selling at $200 per share. a. What is your maximum possible loss? b. What happens to the maximum loss if you simultaneously place a stop-buy order at $210? 2. Old Economy Traders opened an account to short-sell 1,000 shares of Internet Dreams at $40. The initial margin requirement was 50%. (The margin account pays no interest.) A year later, the price of Internet Dreams has risen from $40 to $50,...

Suppose that you sell short 200 shares of Xtel, currently selling for $80 per share, and...

Suppose that you sell short 200 shares of Xtel, currently selling for $80 per share, and give your broker $10,000 to establish your margin account. a. If you earn no interest on the funds in your margin account, what will be your rate of return after one year if Xtel stock is selling at: (i) $85; (ii) $80; (iii) $75? Assume that Xtel pays no dividends. (Leave no cells blank - be certain to enter "0" wherever required. Negative values...

You sell short 200 shares of FNH at $25/share. The initial margin is 60% and maintenance...

You sell short 200 shares of FNH at $25/share. The initial margin is 60% and maintenance margin 30%. If you sell all shares at $21, and receive $1.50/share dividend: a. What is your percent return? b. At what price would you receive a margin call?

Suppose that you sell short 200 shares of Xtel, currently selling for $50 per share, and...

Suppose that you sell short 200 shares of Xtel, currently selling for $50 per share, and give your broker $6,000 to establish your margin account. a. If you earn no interest on the funds in your margin account, what will be your rate of return after one year if Xtel stock is selling at: (i) $56; (ii) $50; (iii) $45? Assume that Xtel pays no dividends. b. If the maintenance margin is 25%, how high can Xtel’s price rise before...

Question