You decide to invest in gold: you purchase 30 ounces of gold at $1,550 per ounce and hold it for two years. At the end of the two years you sell your gold for $1,700 per ounce. What is the return on your investment?

You decide to invest in gold: you purchase 30 ounces of gold at $1,550 per ounce...
Prema purchased 27 ounces of gold in 2005 for $447 per ounce in order to try to diversify her investment portfolio. She sold a third of her holdings in gold in 2009 at a price $850 per ounce. She sold the rest of her gold holdings in 2010 for $1,129 per ounce. What would her profit have been if she sold all the gold holdings in 2009?
You bought gold 3 years ago at $1060 per ounce. Today, it is $1314 per ounce. What was your annual return?
18. You sell one December gold futures contract when the futures price is $1,010 per ounce. The contract is on 100 ounces of gold and the initial margin per contract that you provide is $2,000. The maintenance margin per contract is $1,500. During the next day the futures price rises to $1,012 per ounce. What is the balance of your margin account at the end of the day? A. $1,700 B. $2,200 C. $1,300 D. $1,800 19. A hedger takes...
Suppose the current price of gold is $1,520 an ounce. Hotshot Consultants advises you that gold prices will increase at an average rate of 13% for the next two years. After that the growth rate will fall to a long-run trend of 3% per year. Assume that gold prices have a beta of 0 and that the risk-free rate is 5.75%. What is the present value of 1.6 million ounces of gold produced in 9 years? (Do not round intermediate...
Some time ago, a company negotiated a long forward contract to purchase 100 ounces of gold at the price of $1400 per ounce. The contract will expire in three months (from now). The current three-month forward price of gold is $1420 per ounce. The three month risk-free interest rate (with continuous compounding) is 8%. What is the value of the forward contract to the company?
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Question 4 (10 marks) Suppose the spot price of gold is $1,500 per troy ounce today. The futures price of gold for delivery in 1 year is $1,530 per troy ounce. Assume that the one-year gold futures contract is correctly priced and there are no storage and insurance costs. Also assume that the risk-free rate is compounded annually and you can borrow and lend money at the risk-free rate. a). What is the theoretical parity price of a two-year...
On 1.11.2019 you enter into a long futures contract for 100 ounces of gold at $1,500 an ounce. Your initial margin is set at 15% of the contract value. The settlement prices for gold on the subsequent two days are: $1550 on 2.11.2019 and $1,470 on 3.11.2019. Show the “marking-to-market” and the adjustment in the margin account at the end of each of the two trading days. What is the total 2-day gain or loss on the position?
19 Suppose that the GBP is pegged to gold at £20 per ounce. The USD is pegged to gold at $35 per ounce. This implies an exchange rate of $175/18. How might an Investor take advantage of situation if the current market exchange rate is $1.60/1£? Multiple Choice points 02-50-30 0 Buy gold at $35 per ounce. Convert the gold to $200 at $20 per ounce. Exchange the €200 for dollars at the current rate of $160 per pound 0...
Suppose you purchase a 30-year zero-coupon bond with a yield to maturity of 5.5 % You hold the bond for five years before selling it.a. If the bond's yield to maturity is 5.5 % when you sell it, what is the rate of return of your investment? b. If the bond's yield to maturity is 6.5 % when you sell it, what is the rate of return of your investment? c. If the bond's yield to maturity is 4.5 %...
Suppose you purchase a 30-year, zero-coupon bond with a yield to maturity of 6.3%. You hold the bond for five years before selling it a. If the bond's yield to maturity is 6.3% when you sell it, what is the annualized rate of return of your investment? b. If the bond's yield to maturity is 7.3% when you sell it, what is the annualized rate of return of your investment? c. If the bond's yield to maturity is 5.3% when...