Answered step by step
Verified Expert Solution
Question
1 Approved Answer
After 4 years, you decide you want to short sell the Matt bonds, which are currently trading for a price of $974.69. Assume the maintenance
After 4 years, you decide you want to short sell the Matt bonds, which are currently trading for a price of $974.69. Assume the maintenance margin is 38% and you sell 100 bonds short and you also have $47,000 in other securities to use as collateral (hint: $47,000 is the extra collateral you hold along with the cash you get from the short sale). At what yield will you get a margin call?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started