Northshore Securities underwrites Lakehead Robotics’ 2,000,000-share issue as a bought deal, paying 9.50 a share. Fill the two cells: the dealer’s gross spread if it resells every share at 10.00, and the dealer’s profit or loss (sign included) if it can only resell at $9.30. Dollars.
Northshore Securities underwrites Lakehead Robotics’ 2,000,000-share issue as a bought deal, paying 9.50 a share. Fill the two cells: the dealer’s gross spread if it resells every share at 10.00, and the dealer’s profit or loss (sign included) if it can only resell at $9.30. Dollars.
Answer
Gross spread at 10.00 → 1000000 · Dealer P&L at 9.30 → -400000
Cells - Gross spread at 10.00 · ±0.01 · unit - Dealer P&L at 9.30 · ±0.01 · unit One formula: `=(resale-purchase)*shares`. At 10.00: (10.00 − 9.50) × 2,000,000 = 1,000,000. At 9.30: (9.30 − 9.50) × 2,000,000 = −400,000 — the dealer’s loss, because in a bought deal the dealer already owns the issue.
CSA news release on order-execution-only dealers (securities-administrators.ca); NI 44-101 index (osc.ca); OpenStax, Introduction to Business (CC BY 4.0) §16.6 — shape only