Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Shares in OKComputer currently trade at $38.17. Your broker allows you to short sell the shares with an initial margin of 30.00% and a maintenance
Shares in OKComputer currently trade at $38.17. Your broker allows you to short sell the shares with an initial margin of 30.00% and a maintenance margin of 20.00%. You short sell 100 shares, posting margin accordingly. The broker charges you no interest on the account. OKComputer pays no dividends. How high would the stock price have to rise in order for you to face 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