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7 November, 09:57

Kim placed an order with her broker for 750 shares of each of three IPOs being offered this week. Each of the IPOs has an offer price of $24. The number of shares allocated to Kim along with the closing prices on the first trading day are: Stock Shares Allocated Price A 750 $ 23.15 B 370 27.43 C 260 29.87. What is Kim's total profit on these three stocks at the end of the first day of trading?

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  1. 7 November, 10:03
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    Kim's total profits on the three stocks at the end of the first day of trading is $2157.80

    Explanation:

    The closing day valuation of stocks needs to be compared with the prices at the IPOs opened that same day to ascertain whether or not a profit has been made.

    The purchase price of IPOs = (750+370+260) * $24

    =$33,120.00

    Closing day valuation = ($23.15*750+$27.43*370+$29.87*260)

    =$35,277.8 0

    The total profit on the day's transactions=$35,277.8 0-$33,120.00

    =$2157.8

    The total profits on the three stocks on first day is $2157.8 0
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