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an investor who owns XYZ stock is optimistic about the long-term growth potential of the company. however, the stock currently priced at $58 has made a sharp advance in the past week, and the investor wants to lock in a minimum price in case the share price drops.. which of the following option transactions will help meet the investors objective?

5:55 put options. buying the puts creates a long stock, long put hedge position. The exercise price for the put is the price at which the owner of the put can sell the stock when the put is exercised. with this position, if the stock falls, the investor will exercise the put and sell the stock at 55. The sale of 55 will be assured in the event of stock prices fall.

if a 5% stock dividend is declared, the owner of one XYZ July 30 call owns

One contract for 105 shares with an effective price at 28.57. when a company pays a stock dividend or effects a fractional stock split, the underlying option is adjusted by increasing the number of shares of the contract covers. The number of contracts owned remains the same, and the effective exercise price is adjusted so that the position value the four and after the adjustment remains the same. ​

when considering the amount of commission or markup to charge, a member firm should consider all of the following except

The price the member firm paid. remember firms should never consider the price they paid as the basis for a markup. instead, the inside market should be used when considering a markup determination. services offered by the firm, liquidity of the security, and the price of the security in the open market can all be used when determining the amount of commission or markup / down to charge.

which of the following statements is true regarding dividend payments on common stock?

dividends on common stock are paid at the discretion of the board of directors and maybe paid even when there are no earnings. dividends on common stock are paid at the discretion of the corporations board of directors. although each stockholder receives in a not proportionate to their holdings, the difference can be any portion of the company's earnings. in fact, a corporation can pay a dividend even when there are no earnings. however, no dividend on common stock can ever be behaved before payment of the dividends do on preferred stock.

municipal brokers brokers deal with all the following except

individuals. as the term suggests, municipals brokers broker deals with other dealers and institutions, not with a general public.

The visible supply maybe found in

the bonfire. The bond buyer, a daily publication dealing primarily with the new issue municipal market, publishes information on the visible supply - the estimated amount of new municipal bonds to be sold over the coming months.

which of the following are characteristics of negotiable sometimes referred to as jumbo CDs?

they are issued and amounts of $100,000 to $1 million they trade in the secondary market. most jumbo CDs are issued with maturities of less than a year. The FDIC ensures up to $250,000 per account