ABC Corp shares trade at $60 and you short 500 shares. The initial margin is 50% and

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ABC Corp shares trade at $60 and you short 500 shares. The initial margin is 50% and your broker has a 35% maintenance margin.

(A) If the stock price rises to $65, what is your percentage margin?

(B) How far can the stock price rise before a margin call?

Related Book For answer-question

Fundamentals of Investments Valuation and Management

ISBN: 978-0077283292

5th edition

Authors: Bradford D. Jordan, Thomas W. Miller

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Posted Date: Feb 26, 2024 06:40 AM

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ABC Corp shares trade at $60 and you short 500 shares. The initial margin is 50% and

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ANSWER IS To calculate the percentage margin and determine how far the stock price can rise before a ... View the full answer

Fundamentals of Investments Valuation and Management

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