Question: Question 5 in the assignment entailed borrowing (asset 4 was the risk-free asset) to invest in asset 1. In other words, you were margin trading
Question 5 in the assignment entailed borrowing (asset 4 was the risk-free asset) to invest in asset 1. In other words, you were margin trading to invest in asset 1.
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a) Calculate your margin at the end of every month. When, if ever, do you receive a margin call?
Uusing the excel to solve the above question, thanks! -
How can I calculate the margin and margin call?
short $100 of asset 4 and use those $100 plus $100 to invest in asset 1 Date Asset 1 Asset 4 Sum Return rate 12 month return Year Annual return 192612 200 -100 100 1927 0.577769901 192701 199.88 -100.25 99.63 -0.0037 1928 0.697386191 0.081 -0.0004 0.0067 1929 1930 1931 192702 207.589068 -99.889038 107.70003 192703 215.6800801 -108.02313 107.65695 192704 216.3043439 -107.926092 108.3782516 192705 228.5480569 -108.703386 119.8446706 192706 234.0806106 -120.156267 113.9243438 192707 244.3905024 -114.266117 130.1243855 192708 265.3756719 -130.488734 134.886938 192709 282.6151126 -135.170201 147.444912 192710 282.1800725 -147.813524 134.3665483 192711 286.4157343 -134.648718 151.7670163 192712 309.8778939 -152.100904 157.7769901 0.1058 -0.0494 0.1422 1932 1933 -0.439181405 -0.569511946 -0.775712453 -0.402961688 0.98245136 0.013202065 1.037370163 0.696262736 -0.603836604 1934 1935 1936 0.0366 0.0931 -0.0887 0.1295 0.0396 1937 1938 1939 0.387800022 -0.014712153 0.577769901 short $100 of asset 4 and use those $100 plus $100 to invest in asset 1 Date Asset 1 Asset 4 Sum Return rate 12 month return Year Annual return 192612 200 -100 100 1927 0.577769901 192701 199.88 -100.25 99.63 -0.0037 1928 0.697386191 0.081 -0.0004 0.0067 1929 1930 1931 192702 207.589068 -99.889038 107.70003 192703 215.6800801 -108.02313 107.65695 192704 216.3043439 -107.926092 108.3782516 192705 228.5480569 -108.703386 119.8446706 192706 234.0806106 -120.156267 113.9243438 192707 244.3905024 -114.266117 130.1243855 192708 265.3756719 -130.488734 134.886938 192709 282.6151126 -135.170201 147.444912 192710 282.1800725 -147.813524 134.3665483 192711 286.4157343 -134.648718 151.7670163 192712 309.8778939 -152.100904 157.7769901 0.1058 -0.0494 0.1422 1932 1933 -0.439181405 -0.569511946 -0.775712453 -0.402961688 0.98245136 0.013202065 1.037370163 0.696262736 -0.603836604 1934 1935 1936 0.0366 0.0931 -0.0887 0.1295 0.0396 1937 1938 1939 0.387800022 -0.014712153 0.577769901
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