 |  Investments, 4th Canadian Edition, 4/e Zvi Bodie,
Boston University School of Management
Alex Kane,
University of California, San Diego
Alan Marcus,
Boston College
Stylianos Perrakis,
Concordia University
Peter Ryan,
University of Ottawa
How Securities are Traded
S&P Projects| Prepared by William Lim, University of New Brunswick. Margin Returns You purchased 500 shares of Imperial Oil (IMO) twelve months ago on a 50% initial margin. If the maintenance margin were 30%, would you have received a margin call over the past year? If you paid 8% on your margin loan, what was your return for the year? Base your answers on the monthly closing prices. Short Sale Returns You shorted 300 shares of Abitibi Consolidated Inc. (ABY) twelve months ago at the closing price. If the initial margin was 50%, what was your return for the year? Ignore interest on the margin loan and base your answers on the monthly closing prices. Notes: - Click on “Company” in the Market Insight home page to access the ticker box.
- Enter the ticker into the ticker box. Note that these tickers correspond to the listing in the New York Stock Exchange, not the Toronto Stock Exchange.
- The share prices are given in U.S. dollars, not Canadian dollars.
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2003 McGraw-Hill Higher Education