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QUESTION 3 a) Refer the information given below. Margin requirement = 70% Shares traded at = RM110 Capital = RM120,000 i) Calculate the maximum value

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QUESTION 3 a) Refer the information given below. Margin requirement = 70% Shares traded at = RM110 Capital = RM120,000 i) Calculate the maximum value can be invested. ii) Find the number of shares that can be bought if the investor maximises the margin given by broker. ii) Compute the new margin if the share price increase to RM120 per share. iv) Compute the new margin if the share price falls to RM95 per share. w If the investor bought 2,000 units of ordinary shares of company ABC at RM42 per share, find the value for securities, your equity and calculate the new margin. (Note: margin loan of RM16,000) Loan margin Equity New margin Share Value of price securities RM42 RM46 RM40 RM30

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