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You are optimistic about Telecom shares. The current market price is $50 per share and you have $5000 of your own to invest. You borrow
- You are optimistic about Telecom shares. The current market price is $50 per share and you have $5000 of your own to invest. You borrow an additional $5000 from your broker and invest $10000 in the shares. How far does the price of Telecom shares have to fall for you to get a margin call if the maintenance margin is 30%? Assume the price fall happens immediately.
FORMULAE:
- Initial Margin = Total Value of Investment Margin Loan
- Margin Percentage = Margin/Total Value of Investment
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Healthcare Finance An Introduction To Accounting And Financial Management
Authors: Louis Gapenski
1st Edition
1567930905, 978-1567930900
