Margin means
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amount of funds investor must provide to buy securities on margin
,Excess margin
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-withdraw excess
-use excess to buy other securities
-leave excess in account
Zero Coupon Bond
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no reinvestment risk
purch at discount from face value
As yields/ IRs increase
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bond prices fall
Diffs b/w options and forwards
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, holder's rights or obligation w/n contract
- opt has right to b/s
- forwards are oblig (risky)
strike price
- opt strike price specified in contract
- forward contracts have no strike price
costs
- premium for opt
- only good-faith deposit
Provincial Bonds
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issue fixed income securities for same reason as fed, to finance program
spending and to fund deficits
debs, promises to pay and their value depends on province's ability to pay
interest and repay principal.
coupon payments backed by provincial tax revenues
Which company would have a stronger effect on the performance of the index?
Company A: 100,000 at $25
Company B: 500,000 at $12
Company C: 650,000 at $18
Company D: 800,000 at $15
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Company D because it has the highest market capitalization of 800,000 x
15= $12 million
, Suppose the 500 XYZ shares Robert purchased for $10 one week ago have risen in
price by $1 this week to $11 per share. In this scenario, how much margin would Robert
be required to have in his account one week after purchase of the shares?
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Must have $2,250 in his account.
At $11, the max loan value increases to $2,750 (50% × $11 × 500) and revised
margin is now $2,250 ($5,000 - $2,750).
Given that Robert originally made a deposit of $2,500, the account shows
an excess margin of $250 ($2,500 - $2,250 = $250).
If he keeps $2,500 in account, account shows loan value of $2,750, req
margin of $2,250, and excess margin of $250.
What is the PV of $1000 bond with no coupon at a discount rate of 5% to be received
in 2 years?
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PV= Future Value / (1+ discount rate)^n
= 1000/ (1.05)^2
= 907.03
When securities of a company listed on a stock exchange are distributed through the
facilities of a Canadian stock exchange, what form of disclosure is required?
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amount of funds investor must provide to buy securities on margin
,Excess margin
Give this one a try later!
-withdraw excess
-use excess to buy other securities
-leave excess in account
Zero Coupon Bond
Give this one a try later!
no reinvestment risk
purch at discount from face value
As yields/ IRs increase
Give this one a try later!
bond prices fall
Diffs b/w options and forwards
Give this one a try later!
, holder's rights or obligation w/n contract
- opt has right to b/s
- forwards are oblig (risky)
strike price
- opt strike price specified in contract
- forward contracts have no strike price
costs
- premium for opt
- only good-faith deposit
Provincial Bonds
Give this one a try later!
issue fixed income securities for same reason as fed, to finance program
spending and to fund deficits
debs, promises to pay and their value depends on province's ability to pay
interest and repay principal.
coupon payments backed by provincial tax revenues
Which company would have a stronger effect on the performance of the index?
Company A: 100,000 at $25
Company B: 500,000 at $12
Company C: 650,000 at $18
Company D: 800,000 at $15
Give this one a try later!
Company D because it has the highest market capitalization of 800,000 x
15= $12 million
, Suppose the 500 XYZ shares Robert purchased for $10 one week ago have risen in
price by $1 this week to $11 per share. In this scenario, how much margin would Robert
be required to have in his account one week after purchase of the shares?
Give this one a try later!
Must have $2,250 in his account.
At $11, the max loan value increases to $2,750 (50% × $11 × 500) and revised
margin is now $2,250 ($5,000 - $2,750).
Given that Robert originally made a deposit of $2,500, the account shows
an excess margin of $250 ($2,500 - $2,250 = $250).
If he keeps $2,500 in account, account shows loan value of $2,750, req
margin of $2,250, and excess margin of $250.
What is the PV of $1000 bond with no coupon at a discount rate of 5% to be received
in 2 years?
Give this one a try later!
PV= Future Value / (1+ discount rate)^n
= 1000/ (1.05)^2
= 907.03
When securities of a company listed on a stock exchange are distributed through the
facilities of a Canadian stock exchange, what form of disclosure is required?
Give this one a try later!
