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David opened a position to buy 116 shares of Netflix (tic:NFLX) at a $452. To open the position, David put 23,760 of his cash as
David opened a position to buy 116 shares of Netflix (tic:NFLX) at a $452. To open the position, David put 23,760 of his cash as equity. Today, the price of NFLX is $434. Assume that the initial margin is 25% and the maintenance margin is 13%. Compute the return over equity for David.
Note: you need to compute first the amount borrowed.
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