Last week, you short sold 400 shares of ABD stock for $12,000. The sale was...
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Last week, you short sold 400 shares of ABD stock for $12,000. The sale was a short sale with an initial margin requirement of 70%. The maintenance margin is 40%. QUESTION #1) At what price will lead to a margin call if the maintenance margin is 40%?
Some positive news concerning the company was released last night and the stock price jumped this morning to $38 per share.
QUESTION #2) What is your current margin position in this stock?
QUESTION #3) Would you receive a margin call?
If you close out the account when the stock price jumped to $38 per share,
QUESTION #4) What is your HPR on this investment?
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