Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. finance
  3. you buy $3500 worth of stock j and simultaneously

You buy $3500 worth of Stock J and simultaneously short-sell exactly half that much of...

70.2K

Verified Solution

Question

Finance

image

You buy $3500 worth of Stock J and simultaneously short-sell exactly half that much of Stock K. Over the following year, the return on Stock J is 12% and the return on Stock K is 20%. The risk-free rate in the economy is 4%. What is the dollar return on your hedge portfolio? Answer: Check

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students