Question
Graham bought 4452 shares at $60.74 and has an initial and maintenance margin of 30% on his account. When he opened the account, 11 months
Graham bought 4452 shares at $60.74 and has an initial and maintenance margin of 30% on his account. When he opened the account, 11 months ago, he just met the minimal margin requirements. The cost of the loan for the margin trade was 5.2% EAR. If any margin calls happen, he must respect the new loan balance. Given that the stock has just attained the price of $9.08, how much of a margin call (in dollars/$) must Graham meet?
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Graham bought 4452 shares at 6074 per share so his total purchase was 4452 6074 270000 His initial m...Get Instant Access to Expert-Tailored Solutions
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