Question

Carry intermediate calculations to at least four decimal places unless instructed differently by the individual question.

Tom purchased 482 shares of stock on margin for $28.32 a share and sold the shares 5 months later for $28.9 a share. The initial margin requirement was 64 percent and the maintenance margin was 31 percent. The interest rate on the margin loan was 9 percent. He received no dividend income. What was his holding period return (in percent)? Answer to two decimals.

Answer 1