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You buy 400 shares of stock at a price of $92 and an initial margin of 60 percent. if the maintenance margin is 30 percent, at what price will you receive a margin call?

Answer :

tutorconsortium344

Marginal Call Price is: 52.57 $

Given:

400 shares

Price: $92

Initial Margin = 60%

Maintenance Margin: 30%

Amount borrowed: (400*92) - (400*92)(60%) = 14,720

Margin call Price = 14720/400 shares/ (1-30%) = 52.57 $

Marginal Call Price is: 52.57 $

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