BU111 Lecture Notes - Institute For Operations Research And The Management Sciences
19
BU111 Full Course Notes
Verified Note
19 documents
Document Summary
Utilize a 2% commission in (purchase commission) and a 2% commission out (sale commission) for all transactions: you are bullish about wmx and instruct your broker to buy as many wmx shares as possible utilizing the full margin. She informs you that your margin requirements are 60%. Wmx is currently trading at /share and you have. ,200 available to invest and your broker has approved you for a 50% margin requirement. You instruct your broker to buy as many shares as possible using the full margin. Your fellow classmate was so persuasive in his investment presentation that you"ve decided to buy as many rim shares as you can. You are approved for a margin account with a 70% margin requirement. You have ,400 available to invest and rim is currently trading at /share. To your delight, your brilliant classmate was right and rim stock rises to /share. Let total amount invested be x", margin requirement is 60%
