The following table shows profit estimates for a company under different economic scenarios.

Using this data, calculate the expected return (in A$)

(Please round your answer to zero decimal places)

BFR Cargo Ltd will shortly be listed on the stock exchange. It is known that the valuation will be between $10.00 and $14.00.

Prior to listing, traders will receive information updates that will allow them to eliminate, with certainty, a given range of values.

The time to listing is 500 hours.

The pricing estimates are driven by the following model:

E_t = P_ub - X(T-t)/E_v

Where:

E_t    = estimate of the price at time t

P_ub  = final price

X     = uniform random variable distributed between -0.05 and 0.05

T     = time until listing

t      = elapsed time

E_v    = initial expected value (at t=0)

At t=100, the trader receives an estimate of the final value from a reputable analyst of $11.76

Calculate the new upper valuation band.

(Please display your answer to 2 decimal places.)

From the list below, choose two conditions that must be met in order to execute an arbitrage transaction. 

Four analysts are examining an upcoming IPO for Modutek Ltd. (Ticker: MOK).

Their valuations are as follows, along with your own impression of the reliability of their historical valuations of other IPOs.

Calculate the expected opening price. (Round your answer to two decimal places)

By trading across both exchanges, calculate the arbitrage profit/share, stated as dollars.  (i.e. either 0.05 or $0.05 acceptable)

BFR Cargo Ltd will shortly be listed on the stock exchange. It is known that the valuation will be between $77.00 and $90.00

Prior to listing, traders will receive information updates that will allow them to eliminate, with certainty, a given range of values.

The time to listing is 350 hours.

The pricing estimates are driven by the following model:

E_t = P_ub - X(T-t)/E_v

Where:

E_t    = estimate of the price at time t

P_ub  = final price

X     = uniform random variable distributed between -4 and 4

T     = time until listing

t      = elapsed time

E_v    = initial expected value (at t=0)

Calculate the value for E_v

(Please display your answer to 2 decimal places.)

The chart below shows TLS's stock price over 6-month period. Your company is preparing to take a SHORT position in TLS but is not quite sure about the market movement in the future. You have been asked to prepare an entry strategy (using Ratchet approach) for this trade.

Suppose you are at the time when the current market price is illustrated in the picture below, from four prices that are labelled in yellow, choose the nearest outcome of the trade if you are permitted to risk 2% of capital. 

The entry point is:

A client offers a block-trade to buy shares from you at $1.59. 

Based on the market depth table below, should you accept the offer?

The chart below shows SCG's stock price over 3-month period. Entry point is the price that your company took a SHORT position. 

Based on the four possible exit points that are labelled in yellow, choose the nearest outcome of the trade using Ratchet approach as an exit strategy, given that you are permitted to risk 4% of capital and the company has not implemented any other strategy to this trade.

The exit price is:

You are a principal trader. Your trading limit is 20,000 shares. Your current position is long 9,000 shares. You want to maintain a long position. A client wishes to sell 10,000 shares to you.