An investor sells a stock short for

An investor sells a stock short for - closes the position....

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An investor sells a stock short for $36 a share. A year later, the investor covers the position at $30 a share. If the margin requirement is 60 percent, what is the percentage return earned on the investment? Redo the calculations, assuming the price of the stock is $42 when the investor
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Unformatted text preview: closes the position. $36 - $30 = $6 profit $36 - $42 = $6 loss Selling at $36 x .60 (margin) = $21.60 Selling at $36 x .60 (margin) = $21.60 $6 / $21.60 = 27.78% return $6 / $21.60 = -27.8%...
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