You have bought on margin 100 zero-coupon bonds, with face value ( 1000), maturing in three years.
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You have bought on margin 100 zero-coupon bonds, with face value \(€ 1000\), maturing in three years. At present, the annual yield (annual return with annual compounding) of the bonds is \(4.3 \%\). The initial margin ratio is \(50 \%\), and the maintenance margin is \(20 \%\). Assuming that we neglect the passage of time, for which yield will you get a margin call?
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Related Book For
An Introduction To Financial Markets A Quantitative Approach
ISBN: 9781118014776
1st Edition
Authors: Paolo Brandimarte
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