If the initial margin requirement is 50 percent on a $9,000 transaction (100 shares at $90 per
Question:
If the initial margin requirement is 50 percent on a $9,000 transaction (100 shares at $90 per share), an investor who wants to fully use the margin provision must contribute $4,500, borrowing $4,500 from the broker.19 The investor could contribute $4,500 in cash or deposit $9,000 in marginable securities. (We abstract from brokerage costs and any other costs in these examples.)
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Related Book For
Investments Analysis And Management
ISBN: 9781118975589
13th Edition
Authors: Charles P. Jones, Gerald R. Jensen
Question Posted: