You are bearish on telecom and decide to sell short 100, Ask an Expert

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You are bearish on Telecom and decide to sell short 100 shares at the current market price of $45 per share.

a. How much in cash or securities must you put into your brokerage account if the broker’s initial margin requirement is 50% of the value of the short position?

b. How high can the price of the stock go before you get a margin call if the maintenance margin is 30% of the value of the short position? (Round your answer to 2 decimal places.)

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92811205

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