Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on May 30, 2023

You shorted 1000 shares of stock A at $100/share. Assume an initial margin of 50% and maintenance margin of 30%. How much can the stock

You shorted 1000 shares of stock A at $100/share. Assume an initial margin of 50% and maintenance margin of 30%. How much can the stock price rise before you receive a margin call? Note that the minimum price change of stock A is $0.01.

Step by Step Solution

★★★★★

3.38 Rating (154 Votes )

There are 3 Steps involved in it

Step: 1

To determine how much the stock price can rise before you receive a margin call we need to calculat... 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

Step: 3

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 Investments Valuation and Management

Authors: Bradford D. Jordan, Thomas W. Miller

5th edition

978-007728329, 9780073382357, 0077283295, 73382353, 978-0077283292

More Books

Students also viewed these Finance questions

Question

★★★★★

An investor initially pays K6 000 towards the purchase of K10 000 worth of shares at K100 each borrowing the rest from a broker; (a) . Draw up the investors simple balance sheet to reflect this...

Answered: 1 week ago

Question

★★★★★

(a) Stock market around the world is affected by COVID-19 pandemic. As an experienced investor you decide to take the advantage of it. Currently the stock of ABC Ltd. Is selling for $40 per share,...

Answered: 1 week ago

Question

★★★★★

Read the case study "Southwest Airlines," found in Part 2 of your textbook. Review the "Guide to Case Analysis" found on pp. CA1 - CA11 of your textbook. (This guide follows the last case in the...

Answered: 1 week ago

Question

★★★★★

3. Using an AD-AS model, can you answer whether a tax that improves people's health could have any potential long-term benefits for the economy.

Answered: 1 week ago

Question

★★★★★

John wants to purchase a car but needs $5,000 to do so. His uncle Eswar offers to loan him the money at 8% compounded yearly. Uncle Shankar offers to loan him the money at 9% simple interest. If both...

Answered: 1 week ago

Question

★★★★★

Indicate whether each of the following statements is true or false by writing T or F in t he a nswer c olumn. Promises made in anticipation of marriage are enforceable.

Answered: 1 week ago

Question

★★★★★

Describe specific developments in the latter part of the twentieth century that contributed to the advance of scholarly work in the history of psychology.

Answered: 1 week ago

Question

★★★★★

A steady-state heat balance for a rod can be represented as d2T/dx2 0.15T = 0 Obtain an analytical solution for a 10-m rod with T(0) = 240 and T(10) = 150.

Answered: 1 week ago

Question

★★★★★

who is legally responsible for preparing the financial statements of Tesco? a. The chief financial officer b. The board of directors c. The independent auditors d. The audit committee

Answered: 1 week ago

Question

★★★★★

Donovan Ramsey, the Chief Financial Officer of LevelUp Business Consulting, has advised you that the company is considering closing its Calgary, Alberta office at the beginning of the next calendar...

Answered: 1 week ago

Question

★★★★★

In 2016, Ryan Management collected rent revenue for 2017 tenant occupancy. For financial reporting, the rent is recorded as deferred revenue and then recognized as income in the period tenants occupy...

Answered: 1 week ago

Question

★★★★★

Conrad sends his quality control manager to Mexico to ensure the quality of a new manufacturer is meeting specifications. Which risk is Conrad addressing? Question 20 options: Process risk Control...

Answered: 1 week ago

Question

★★★★★

Exercise 5-4 Allocation of Cost and Workpaper Entries at Date of Acquisition On January 1, 2012, Porter Company purchased an 80% interest in Salem Company for $260,000. On this date, Salem Company...

Answered: 1 week ago

Question

★★★★★

One World Not Three (OWNT) Relief Fund is an international nonprofit relief agency based in the United States. OWNT recently celebrated its tenth anniversary and is in the middle of trying to expand...

Answered: 1 week ago

Question

★★★★★

explain why U.S. presidents often favor a "lower dollar" over the course of their presidency. Explain the relationship between the relative value of the dollar and its relationship to U.S. exports...

Answered: 1 week ago

Question

★★★★★

The real cost of palm oil case study discussed how the unsustainable farming of palm in Borneo, Sumatra and lower China is perhaps the biggest threat to _____________________. Group of answer choices...

Answered: 1 week ago

Question

★★★★★

On January 1, a company issued and sold a $360,000, 4%, 10-year bond payable, and received proceeds of $350,000. Interest is payable each June 30 and December 31. The company uses the straight-line...

Answered: 1 week ago

Question

★★★★★

The roof of a refrigerated truck compartment is of composite construction, consisting of a layer of foamed urethane insulation (t2 = 50 mm, ki = 0.026 W/m K sandwiched between aluminum alloy panels...

Answered: 1 week ago

Question

★★★★★

You believe that Rose, Inc., stock is going to fall and you've decided to sell 1,500 shares short. If the current share price is $47, construct the equity account balance sheet for this trade. Assume...

Answered: 1 week ago

Question

★★★★★

Use the data below to construct the advance/decline line for the stock market. Volume figures are in thousands ofshares. Advancing Declining Monday Tuesday Wednesday Thursday Friday Advancing 1,612...

Answered: 1 week ago

Question

★★★★★

You are managing a pension fund with a value of $200 million and a beta of 1.07. You are concerned about a market decline and wish to hedge the portfolio. You have decided to use SPX calls. How many...

Answered: 1 week ago

Question

★★★★★

Respond to each of the following questions using this partially completed one-way ANOVA table: a. How many different populations are being considered in this analysis? b. Fill in the ANOVA table with...

Answered: 1 week ago

Question

★★★★★

Answered: 1 week ago

Question

★★★★★

A two-factor experiment yielded the following data: a. Determine if there is interaction between factor A and factor B. Use the p-value approach and a significance level of 0.05. b. Given your...

Answered: 1 week ago

Previous Question Next Question