If A sold all his remaining shares after 1 week at Rs 420 per share find his overall profit or loss ...........

Quantitative Aptitude (SBI-PO) Profit and loss

Direction: A, B, C, D and E are 5 stock investors. B purchased 2000 shares of reliance capital at 400. He seems market as a bearish and sold all his shares at 390 on next day. A, C and D bought 1000, 700 and 300 of these shares in quantity on the same day respectively. Now A and C sold 500 and 350 shares respectively on the same day and E purchased them at 395

Intraday ⇒ Buy and Sell shares on same day.

Delivery ⇒ Buy and Sell on different days.

Brokerage charges for Intraday for each transaction = 1%

Brokerage charges for Delivery for each transaction = 0.5%

If A sold all his remaining shares after 1 week at Rs. 420 per share, find his overall profit or loss percentage on these shares only.

This questions was previously asked in

SBI PO Mains (20 Jul, 2019)

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5.8%

3.3%

6.6%

13.2%

None of these

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Explanation:

Let’s break it down with the numbers that matter:

- B bought 2000 shares at ?400, sold at ?390 next day—clearly a bearish move, took a loss.

- A bought 1000 of those shares at ?390 (delivered from B), brokerage for delivery is 0.5% both when buying and selling.

- On the same day, A sold 500 out of his 1000 shares (intraday)—brokerage for intraday is 1% per transaction.

- A still had 500 shares left. After 1 week, he sold them at ?420 each.

Let’s calculate profit/loss on these 500 shares:

1. Buy price per share = ?390

- Brokerage on buying (delivery) = 0.5% of 390 = ?1.95 per share

- Effective buy price = ?391.95 per share

2. Sell price per share = ?420 (after a week)

- Brokerage on selling (delivery) = 0.5% of 420 = ?2.10 per share

- Effective sell price = ?417.90 per share

3. Profit per share = ?417.90 - ?391.95 = ?25.95

- Total profit = ?25.95 × 500 = ?12,975

4. Total investment = ?391.95 × 500 = ?195,975

5. Profit Percentage = (?12,975 / ?195,975) × 100 ˜ 6.6%

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Option 3: 6.6%

What this really means:

You understood the problem, crunched the brokerage correctly, and landed on the perfect profit percentage for A’s remaining shares. The brokerage eats into the gains, but A still makes a neat 6.6% profit. Option 3 is exactly right.