You sold short 100 shares of common stock at $75 per share.The initial margin is 50%.At what stock price would you receive a margin call if the maintenance margin is 30%?

Question

Quizplus · Accepted Answer

To find the stock price at which a margin call occurs, use the formula: (Initial Sale Price * (1 + Initial Margin)) / (1 + Maintenance Margin). Here, it is ($75 * 1.5) / 1.3 = $86.54.

You Sold Short 100 Shares of Common Stock at $75