You just sold 1,200 shares of stock short at a price per share of $13.50.The initial margin requirement is 60 percent and the maintenance margin is 30 percent.What is your initial equity position?

Question

Quizplus · Accepted Answer

Proceeds from sale = 1,200 × $13.50 = $16,200
Initial margin deposit = 1,200 × $13.50 × 0.60 = $9,720
Short position = 1,200 × $13.50 = $16,200
Account equity = $16,200 + $9,720 - $16,200 = $9,720

You Just Sold 1,200 Shares of Stock Short at a Price