You recently purchased 200 shares of stock at a cost per share of $32.50.The initial margin requirement on this stock is 75 percent and the maintenance margin is 50 percent.The stock is currently valued at $35.00 a share.What is your current margin position? Ignore margin interest.
A) 73.01 percent
B) 73.83 percent
C) 74.95 percent
D) 75.69 percent
E) 76.79 percent

Question

Quizplus · Accepted Answer

Margin loan = 200 × $32.50 × (1 - 0.75) = $1,625
Current stock value = 200 × $35.00 = $7,000
Current equity = $7,000 - $1,625= $5,375
Current margin = $5,375 / $7,000 = 76.79 percent

You Recently Purchased 200 Shares of Stock at a Cost