Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

You short sell 100 shares of TSLA at $280/share. The initial margin is 60% and the current brokerage call rate is 7%. Assuming that 50

You short sell 100 shares of TSLA at $280/share. The initial margin is 60% and the current brokerage call rate is 7%. Assuming that 50 days later, TSLA share price has risen to $360/share. 

Will you get a margin call if the maintenance margin is 30%? 

If so, how much is the margin call?



Step by Step Solution

3.42 Rating (155 Votes )

There are 3 Steps involved in it

Step: 1

To determine whether you will receive a margin call we need to calculate the equity in your short ... blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Principles of Finance

Authors: Scott Besley, Eugene F. Brigham

6th edition

9781305178045, 1285429648, 1305178041, 978-1285429649

More Books

Students also viewed these Finance questions