You believe the stock in Freeze Frame Co. is going to fall, so you short 600...

You believe the stock in Freeze Frame Co. is going to fall, so you short 600 shares at a price of $72. The initial margin is 50 percent. Construct the equity balance sheet for the original trade. Now construct equity balance sheets for a stock price of $63 and a stock price of $77. What is your margin at each of these stock prices? What is your holding period return if you cover your short position at each of these prices in five months?

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jeff jeffy answered 1 year ago

You believe the price of Freeze Frame Co. stock is going to fall, so you short...

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