Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

You buy 100 shares of stock at $60 per share. You borrow $2,000 on margin (less than the maximum amount). The initial margin is 55%

You buy 100 shares of stock at $60 per share. You borrow $2,000 on margin (less than the maximum amount). The initial margin is 55% and the maintenance margin is 30%. The price of the stock increases to $90 per share. Calculate your percentage gain or loss. [Two ways to calculate this, either way is fine. Since you did not borrow the maximum amount, your initial margin was 66.67%.]

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