Question
Assume that an investor buys 100 shares of stock at $50 per share, putting up a 60% margin. a. What is the debit balance in
Assume that an investor buys 100 shares of stock at $50 per share, putting up a 60% margin.
a. What is the debit balance in this transaction?
b. How much equity capital must the investor provide to make this margin transaction?
c. If the stock rises to RM 80 per share,what is investor's new margin transaction?
d. Kindly advise investor the pros and cons when involve in margin trading?
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Valuation Measuring and managing the values of companies
Authors: Mckinsey, Tim Koller, Marc Goedhart, David Wessel
5th edition
978-0470424650, 9780470889930, 470424656, 470889934, 978-047042470
