Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

You are bearish on Telecom and decide to sell short 100 shares at the current market price of $49 per share. a. How much in

image text in transcribed

You are bearish on Telecom and decide to sell short 100 shares at the current market price of $49 per share. a. How much in cash or securities must you put into your brokerage account if the broker's initial margin requirement is 50% of the value of the short position? Answer is complete but not entirely correct. Initial margin $ 30 X b. How high can the price of the stock go before you get a margin call if the maintenance margin is 30% of the value of the short position? (Round your answer to 2 decimal places.) > Answer is complete but not entirely correct. Stock price $ 68.60 reaches

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored 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

Recommended Textbook for

Fundamentals Of Futures And Options Markets

Authors: John C. Hull

7th Edition

0136103227, 9780136103226

More Books

Students also viewed these Finance questions