Your broker charges $0.0011 per share per trade. The exchange charges $0.0065 per share per trade for removing liquidity and credits $0.0047 per share per trade for adding liquidity. The current best BID price for stock XYZ is $62.73 per share, while the current best ASK price is $62.74 per share. You post an order to buy XYZ at the current best BID price and wait. Shortly after, the best BID and ASK prices move lower (down) by one cent each. Your buy order is executed. Immediately, you post an order to sell XYZ at the new best BID price, and your sell order is executed. What will be your net loss per share to buy and sell XYZ after considering the commissions and any exchange fees or credits?
Your broker charges $0.0011 per share per trade. The exchange charges $0.0065 per share per trade for removing liquidity and credits $0.0047 per share per trade for adding liquidity. The current best BID price for stock XYZ is $62.73 per share, while the current best ASK price is $62.74 per share. You post an order to buy XYZ at the current best BID price and wait. Shortly after, the best BID and ASK prices move lower (down) by one cent each. Your buy order is executed. Immediately, you post an order to sell XYZ at the new best BID price, and your sell order is executed. What will be your net loss per share to buy and sell XYZ after considering the commissions and any exchange fees or credits?
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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M1
Transcribed Image Text:Your broker charges $0.0011 per share per trade.
The exchange charges $0.0065 per share per trade
for removing liquidity and credits $0.0047 per
share per trade for adding liquidity. The current
best BID price for stock XYZ is $62.73 per share,
while the current best ASK price is $62.74 per
share. You post an order to buy XYZ at the current
best BID price and wait. Shortly after, the best BID
and ASK prices move lower (down) by one cent
each. Your buy order is executed. Immediately, you
post an order to sell XYZ at the new best BID price,
and your sell order is executed. What will be your
net loss per share to buy and sell XYZ after
considering the commissions and any exchange
fees or credits?
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