Direction: Read the following information carefully and answer the questions based on it.
The following chart shows the price of shares of company A on five trading days during an active trading session. The ceiling and floor of the line depicts the maximum and minimum prices respectively of a share throughout the day. The ceiling and floor of the box depicts opening price and closing price respectively for black box and the opposite in case of white box.
There are some other charges on buying and selling as per:
• Brokerage Charge on buying- 0.60%(max Rs 50) uptoRs 10000, 0.30% (max Rs 125) above Rs 10000 and uptoRs 50000 and 0.15%(max Rs 500) above Rs 50000.
• Brokerage Charge on selling- 0.80% (max Rs 300) uptoRs 50000 and 0.60% (max Rs 2000) above Rs 50000.
• Stamp Duty- .015% flat on buying only
• Securities Transaction Tax(STT)- 0.1% flat on both side
GST @18% is levied extra on brokerage charges for each transactions
1) Prakash bought 50000 shares of company A at Rs 2 more than that day’s low on 30-04-2019 and sold them on 03.05.2019 at Rs 3 less than that day’s high. What is the profit or loss percentage of Prakash on the selling of shares?
A. 66.80%
B. 67.30%
C. 64.50%
D. 61.21%
E. None of these
Sol:
Day’s low on 30thapril=Rs 53
=> Buying price of Prakash=53+2= Rs 55
Cost price of 50000 shares=55*50000=Rs
2750000
Brokerage cost is 0.15% or Rs 500 whichever is
lower for the corresponding slab.
Brokerage cost at 0.15%=0.15/100*2750000=
Rs 4125
So actual brokerage cost=Rs 500. With
GST @18%, brokerage cost=1.18*500=Rs
590
Stamp duty=0.015% and STT=0.1%
Total overhead cost=Rs
590+0.115%*2750000=Rs 590+ Rs 3162.50=Rs
3752.50
Total CP for Prakash with overhead
cost=2750000+3752.50=Rs 2753752.50
Day’s high on 3rd May, 2021=Rs 95
=> Selling price of Prakash=Rs 92
Money from selling 50000 shares=92*50000=Rs
4600000
Brokerage on selling is @0.60% or Rs 2000
whichever is lower.
Brokerage @0.60%=0.60/100*4600000= Rs
27600. Thus, brokerage cost would be Rs
2000
STT on selling=0.1/100*4600000= Rs 4600
Total money with Prakash after deduction of
brokerage and STT=Rs 4600000-Rs 4600-
Rs 2000=Rs 4593400
So, Prakash shall be in profit. Total profit= Rs
4593400-Rs 2753752.50=Rs 1839647.50
Profit percentage =1839647.50/2753752.50*100
=66.80 %
2) Someone bought 200 shares on 30th April, 100 shares on 2nd May and 250 shares on 4th May at the opening price. What is the average cost per share considering all the charges?
A. Rs 73.09
B. Rs 73.43
C. Rs 74.15
D. Rs 72.85
E. None of these
Sol:
Buying price=Rs 64. Total cost of buying=Rs
64*200=Rs 12800. Brokerage cost
@0.30%=0.30/100*12800=Rs 38.40
STT=0.1/100*12800=Rs 12.8
Stamp Duty=0.015/100*12800=Rs 1.92
Total cost including overhead
costs=Rs.12800+Rs.38.40+Rs.12.8+Rs.1.9
2=Rs 12853.12
On 2nd May,
Buying Price=Rs 69. Total cost of buying=Rs
69*100=Rs 6900
Brokerage cost @0.60%=Rs 41.4
STT and Stamp duty=0.115*6900=Rs 7.935
Total cost including overhead
costs=Rs.6900+Rs.41.4+Rs.7.935=Rs.6949.335
On 4th May,
Buying Price=Rs 82. Total cost of buying= Rs
82*250=Rs 20500
Brokerage cost at 0.30% =0.30/100*20500=Rs
61.50
STT and Stamp
duty=0.115/100*20500=Rs.23.575
Total cost including overhead costs
=Rs.20500+Rs.61.50+Rs.23.575 =Rs.20585.075
Total cost of all
shares=Rs.12853.12+Rs.6949.335+Rs.20585.0
75=Rs 40387.53
Total shares owned=200+100+250=550
=> Average price per share=40387.53/550=Rs
73.43
3) What is the 5-day simple moving average of the share on the basis of the average of opening and closing price on these five days?
A. 85.8
B. 78.2
C. 79.4
D. 74.5
E. None of these
On the basis of average of opening and closing
price of the share,
Price on 30.04.2019= (64+60)/2=62
Price on 02.05.2019= (69+80)/2=74.5
Price on 03.05.2019= (80+90)/2=85
Price on 04.05.2019= (82+72)/2=77
Price on 05.05.2019= (90+95)/2=92.5
=> Simple moving average of the share =
(62+74.5+85+77+92.5)/5 =391/5 =78.2
4) Aakash bought 2000 shares on
02.05.2019 and sold them on 04.05.2019 both at opening price. If Aakash plans to buy the shares again on 05.05.2019 at day’s low, how many shares he could buy with the profit he gets by selling shares on 04.05.2019?
A.302
B. 303
C. 300
D. 301
E. 212
Sol:
On 02.05.2019, opening price=Rs 69
Cost of 2000 shares=2000*69=Rs 1,38,000
Brokerage @0.15%=Rs 207
STT+Stamp duty@ (0.1+0.015) i.e.,
@0.115%=Rs 158.70
Total cost price for Aakash=Rs 1,38,365.70
On 04.05.2019, opening price=Rs 82
Money from sale of 2000 shares=Rs 164000
Brokerage @0.60%=Rs 984
STT @0.1% =Rs 164
Total money from sales of shares=Rs 164000-
Rs 984- Rs 164=Rs 162852
Thus, profit of Aakash=Rs 162852-Rs
138365.70=Rs 24322.30
Now, day’s low on 05.05.2019=Rs 80
If Aakash buys 303 shares, cost=303*80=Rs
24240
Brokerage@0.30%=Rs 72.72
STT+Stamp Duty @0.115%=Rs 27.876
Total cost=Rs 24240+Rs 72.72+Rs 27.876=
Rs 24340.596 which is higher than profit Rs
24322.30
So Aakash must buy 302 shares.
5) Some shares were bought on 2nd May at the opening price and were sold on day’s high on the same day. How many shares must be traded on an intraday basis to get a profit of a minimum of Rs.5000?
A. 385
B. 398
C. 391
D. Can’t be determined
E. None of these
Sol:
On 2nd may
Opening price =Rs 69
Day’s high=Rs 82
Excluding taxes and brokerage, profit in one
share=Rs 13
For 385 shares,
Buying cost=Rs 69*385=Rs 26565
Brokerage @0.30 %( as total buying is
between Rs 10000 and Rs 50000)
=0.30/100*385*69=Rs 79.695
STT & STAMP
DUTY@0.115%=0.115/100*26565=Rs 30.55
Selling cost=Rs 82*385=Rs 31570
Brokerage@0.80 %=Rs 252.56
STT @0.1%=Rs 31.57
Net profit=31570-26565-79.695-30.55-
252.56-31.57= Rs 4610.625 which is
short of target Rs 5000 by Rs 389.375.
For 398 shares,
Buying cost=Rs 69*398=Rs 27462
Brokerage @0.30 %( as total buying is
between Rs 10000 and Rs 50000) =Rs
82.386
STT & STAMP DUTY@0.115%=Rs 31.58
Selling cost=Rs 82*398=Rs 32636
Brokerage@0.80 %=Rs 261
STT @0.1%=Rs 32.64
Net profit=32636-27462-82.386-31.58-261-
32.64=Rs 4766.39 which is again less than
Rs 5000
Since 398 shares don’t fulfil the profit
requirement, 391 shares will also not fulfil the
requirement.
Thus, none of the option gives Rs 5000 profit.
