Question
On 7 th June 2021, Bill took a long position in CIQ stocks using the margin trading facility provided by his broker. He also used
On 7th June 2021, Bill took a long position in CIQ stocks using the margin trading facility provided by his broker. He also used short selling facility to sell stocks of DTM Limited on the same day. His broker requires initial margin of 60% and maintenance margin of 40% for both margin trading and short selling facility. In the following few days stock prices of CIQ and DTM did not move in the direction Bill expected. Bill closed both of these positions on 16th June and he suffered losses on both of these trades. Following are the stock price charts of CIQ and DTM shares between 7th June to 18th June 2021.
- Can you identify which one of these charts (Chart A or Chart B) shows the price movement of DTM stocks between the dates 7th June to 18th June 2021. Explain your answer with reasons.
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