Question

Alfred has been watching the news. Everyone believes that a new phone to be sold by Sammy’s Son, Inc. will become the most popular phone out there. Alfred contacts his brokerage firm and lets them know that he is buying 1,500 shares of Sammy’s Son stock, counting on a huge pop in the stock price, once the phone is released. Unfortunately, there are a few difficulties with the phone (it catches on fire, for example). The stock tanks. Alfred wants to rescind the stock purchase contract. What can he recover?

Answer 1

Answer: Alfred can recover nothing.

Explanation: When a stock "tanks", it loses all its value in the stock market and is worth nothing. The stock is therefore, removed from the stock exchange.