Transaction costs
Transaction costs
In late December you decide to sell a losing position that you hold in Twitter so you can capture the loss and use it to offset some
a. Suppose that your total transaction costs for selling the 1,500 shares of Twitter in December were $45.00. What was the bid/ask spread for Twitter at the time your trade was executed? The bid/ask spread for Twitter, at the time your trade was executed, is $........? (Round to four decimal places.)
b. When your February statement arrives in the mail, you see that your total transaction costs for buying the 1,500 shares of Twitter were $40.20. What was the bid/ask spread for Twitter at the time your trade was executed? The bid/ask spread for Twitter, at the time your trade was executed, is $........? (Round to four decimal places.)
c. What are your total round-trip transaction costs for both selling and buying the shares, and what could you have done differently to reduce the total costs?Your total round-trip transaction costs for both selling and buying the shares is$........? (Round to the nearest cent.)
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