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Homework answers / question archive / A portfolio manager purchases shares in YUL that are worth $2,000
A portfolio manager purchases shares in YUL that are worth $2,000. At the same time, this manager goes short shares worth $700. 20. What is the net market exposure? A) B) C) D) 50% 65% 90% 45% What is the leverage factor? 4 |??? A) B) 1.05 1.08 1.35 1.65
Net market exposure = Long positions- Short Positions/Long positions*100
= 2,000-700/2,000
= 1,300/2,000
= 0.65 or 65%
Answer : 65% (B)
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