MMC Bank Has an Equity Trading Portfolio That Consists of Long

question 88

Multiple Choice

MMC Bank has an equity trading portfolio that consists of long positions of 2,750 shares of McDonald's Corp.at a price of $97.50;3,500 shares of Duke Energy at a price of $65.00;and 1,000 share of the Swiss firm USB Bancorp at a price of $47.50.In addition the bank has sold short 1,500 shares of the Japanese technology firm Sony at a price of $32.00 and 750 shares of McDonald's Corp.What is the amount of capital that MMC Bank is required to keep against this portfolio according to the Basel Standardized approach?

• A)$135,360.52
• B)$98,373.59
• C)$36,987.33
• D)$116,044.60

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Definitions:

Statistical Profile

A summary of data that provides an overview of various statistical measures and patterns within a dataset.

Effective Yield

The actual return on an investment, considering the compounding of interest.

Perpetuity

Bond paying out a fixed amount of money each year, forever.

Yearly Payment

The amount of money paid or received over the course of a year for any financial transaction or obligation.