If the initial margin requirement is 50 percent on a $9,000 transaction (100 shares at $90 per

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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.)

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Investments Analysis And Management

ISBN: 9781118975589

13th Edition

Authors: Charles P. Jones, Gerald R. Jensen

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