You have been researching a stock that you like, which is currently trading at $39 per share. You would like to buy the stock if it were a little less expensive—say, $36 per share. You believe that the stock price will go to $59 by year-end and then level off or decline. You decide to place a limit order to buy 100 shares of the stock at $36 and a limit order to sell it at $59. It turns out that you were right about the direction of the stock price, and it goes straight to $64. What is your current position?
You have been researching a stock that you like, which is currently trading at $39 per share. You would like to buy the stock if it were a little less expensive—say, $36 per share. You believe that the stock price will go to $59 by year-end and then level off or decline. You decide to place a limit order to buy 100 shares of the stock at $36 and a limit order to sell it at $59. It turns out that you were right about the direction of the stock price, and it goes straight to $64. What is your current position?
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Question
You have been researching a stock that you like, which is currently trading
at $39 per share. You would like to buy the stock if it were a little less expensive—say, $36 per share. You believe that the stock price will go to $59 by year-end and then level off or decline. You decide to place a limit order to buy 100 shares of the stock at $36 and a limit order to sell it at $59. It turns out that you were right about the direction of the stock price, and it goes straight to $64. What is your current position?
at $39 per share. You would like to buy the stock if it were a little less expensive—say, $36 per share. You believe that the stock price will go to $59 by year-end and then level off or decline. You decide to place a limit order to buy 100 shares of the stock at $36 and a limit order to sell it at $59. It turns out that you were right about the direction of the stock price, and it goes straight to $64. What is your current position?
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