Ed buys 500 shares of Niagara Corporation stock for $30 a share with an initial margin requirement of 55% and he paid 13% interest on the loan.

Depends on what Ed sells the stocks for and how long he holds them. To get rate of return, you take the total sales price, subtract the buy price plus any interest paid, divide the profit/loss by the buy price, and multiply by 100 (to covert to percentage). If Ed holds the stock for less than a year, you have to annualize the rate of return (i.e., if he held the stocks for 6 months, multiply by 2).

It will cost him to hold the stock and pay the interest, so the stock would have to go up enough to cover the interest before there could be any gain. It would also have to cover the commissions to buy and sell.

With today is bear market he would wind up losing his shirt. So the rate of return would be negative.

Just listen to the two up above you do not need my input its a repeat!