Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

You are bearish on ABC stock and ask your broker to sell short 1000 shares at the current market price of $50/ share. Initial margin

image text in transcribed
You are bearish on ABC stock and ask your broker to sell short 1000 shares at the current market price of $50/ share. Initial margin is 50% of the value of short position. How high can the price of stock go before you get a margin call if the MMR is 40% of the value of the short position

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Students also viewed these Finance questions