Question
Suppose you have an account with a broker which requires the value of your equity in your account to be at least 42% of total
Suppose you have an account with a broker which requires the value of your equity in your account to be at least 42% of total account value. You have $50,000 to invest and you borrowed $30,000 on the margin from your broker for a total purchase of $80,000 of AMZN stock at $200 a share. While you intended to hold your AMZN position for one year, however the price of the stock gradually decreases and after 3 months rapidly falls over one day from $120 to $85. What will be the cash amount of margin call your broker will ask you to deposit into your account if you do not want part of your position to be liquidated by your
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