Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

You want to buy 100 shares of Xilinx Inc. (NASDAQ: XLNX). The market price is $69. The initial margin requirement is 50%. The maintenance margin

image text in transcribed

image text in transcribed

You want to buy 100 shares of Xilinx Inc. (NASDAQ: XLNX). The market price is $69. The initial margin requirement is 50%. The maintenance margin requirement is 30%. You want to get the following information before you make an investment decision. How much equity you must have in the account to initiate the position? At what price will you get a margin call? If the price of the stock falls to $45, what is the equity balance and margin ratio in the margin account? How much funds you need to deposit to meet the margin requirement? If you don't have extra funds to deposit, how many shares of XLNX the broker will have to liquidate to maintain the margin account? Show the new balance sheet. You want to buy 100 shares of Xilinx Inc. (NASDAQ: XLNX). The market price is $69. The initial margin requirement is 50%. The maintenance margin requirement is 30%. You want to get the following information before you make an investment decision. How much equity you must have in the account to initiate the position? At what price will you get a margin call? If the price of the stock falls to $45, what is the equity balance and margin ratio in the margin account? How much funds you need to deposit to meet the margin requirement? If you don't have extra funds to deposit, how many shares of XLNX the broker will have to liquidate to maintain the margin account? Show the new balance sheet

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

Meetings Expositions Events And Conventions An Introduction To The Industry

Authors: George G. Fenich

4th Global Edition

1292093765, 9781292093765

More Books

Students also viewed these Finance questions

Question

What are our strategic aims?pg 87

Answered: 1 week ago