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You have been closely watching AMAZON (NSE: AMZ) and believe that the share price should increase over the next two months. Assuming that your broker
You have been closely watching AMAZON (NSE: AMZ) and believe that the share price should increase over the next two months. Assuming that your broker charges a borrowing rate of 7% a year, requires an initial margin of 60%, maintenance margin of 30% and an initial assumed exposure of 1000 shares, calculate:
Time | Bid | Ask |
Today | 28,25 | 29,38 |
2 Months | 31,30 | 32,55 |
- The price equal to or below which you will get a margin call is closest to:
A) US$21.66
B) US$19.39
C) US$16.79
D) US$13.35
E) US$22.41
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