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Unformatted text preview: Raising Marks. Raising Money. Raising Roofs.
www.schoolsos.com Students Offering Support: Wilfrid Laurier University Buying on Margin
Steps to Success:
1. Calculate the Broker Loan
= (investor’s money ÷ minimum margin requirement) - investor’s money
2. Calculate the # of shares that can be purchased
= (investor’s money + broker loan) ÷ (market price per share at the time of
3. Calculate the purchase price
= # shares x (market price per share at the time of purchase)
= investor’s money investing + broker loan
4. Calculate the purchase commission
= 2% of the purchase price
5. Calculate the sale price
= #shares x (market price per share at the time of sale)
6. Calculate the sale commission
= 2% of the return on the sale
7. Calculate the capital gain (if this # is negative it is a capital loss)
= sale price – sale commission – purchase price – purchase commission Problem 5
After winning $10,000 playing Plinko on The Price is Right, you decide purchase common
shares of Corus Entertainment on marg...
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This note was uploaded on 02/07/2014 for the course BU 111 taught by Professor Jessicastockie during the Fall '08 term at Wilfred Laurier University .
- Fall '08