MGT330 - Assignment 1.docx - MGT330 – ASSIGMENT 1...

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MGT330 – ASSIGMENT 1 Question 1 a) b) My experience was fairly informative, having to trade all day helped me understand how and when to place what type of orders. According to me, I would have done better if I would have distributed my transactions equally throughout the day, rather than focusing all of them at one point and forgetting about till the end of the trading day, when I had to ultimately sell my shares at a loss. Question 2 Canadian Imperial Bank of Commerce (CM.TO) a) Yes, we will have to deposit 50% of our short sell transaction’s market value into our account after making the short sale. i.e. Market Value of our Short Sale Transaction= 100 shares * $119.37 = $11,937 So, we will have to invest 50% of $11,937 = $5,968.5 Although, because the price of my selected company (i.e. CIBC – CM.TO) went down from $119.37 on October 10, 2018 to $115.36 on October 12, 2018, I do not need to deposit any cash in my account prior to closing the short position. b) Total Cash in my account after satisfying the margin requirement on October 10, 2018 and prior to closing my short sale will remain the same, i.e.
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