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Suppose you bought 100 shares of stock at $50 per because you feel it'll rise to $60 within 3 months. The stock pays $4 per
Suppose you bought 100 shares of stock at $50 per because you feel it'll rise to $60 within 3 months. The stock pays $4 per share in annual dividends. You are going to buy the stock with a 70% margin and will pay 8.5% interest on the margin loan. Unfortunately, the stock price goes to $30 after 3 months, will you receive a margin call if the maintenance margin is 30% ? (Slide \#1)
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