User Account

All Pages

Initial margin percentage

Assignment Help Finance Basics
Reference no: EM133076021

You short 25,000 shares of FaceSpace, Inc. at $320/share. The initial margin requirement is 50% and the maintenance margin is 35%.

(i) At what price per share will you get a margin call? How much money would you have lost if the stock did hit that price?

(ii) Now assume the price of FaceSpace shares fall to $300 and you decide to "press you bet" by shorting more shares. You feel comfortable increasing the amount of your equity margin back up to the dollar amount of your original position when the stock was priced at $320/share. Assuming the initial margin percentage remains at 50%, how many additional shares could you short?

Reference no: EM133076021

Questions Cloud

Provide the situation and the risks involved : Have you ever purchased something from a different country? Share a time when you or someone you know was involved in a currency exchange transaction.
Advocate of the behavioral finance : The advocate of the behavioral finance contend that the standard finance theory is incomplete. Discuss
Prepare a business report explaining the growth : Prepare a business report explaining the growth of your selected small business or social enterprise and produce.
Compute the macaulay duration : Consider a 10-year Bond A which has a face value $100 and pays coupon every 6 months. The coupon rate is 6% per year, and the next payment is 6 months later.
Initial margin percentage : You short 25,000 shares of FaceSpace, Inc. at $320/share. The initial margin requirement is 50% and the maintenance margin is 35%.
Employee performance evaluation : Based on our own experience, what should be included in an employee performance evaluation?
Sharp ratio of portfolio : Currently, the Sharp ratio of your portfolio is 3. Can you find the new Sharp ratio of your portfolio if its expected return stays the same, its total risk (sta
What is the effective borrowing cost for loan : A borrower would like to borrower $60,000 to finance a property for 30 years at 12% interest. He will only hold this investment for 5 years.
Conducting the literature review : When conducting the literature review for your research, when do you feel you need to start searching for literature?

Reviews

Write a Review

Finance Basics Questions & Answers

  Financial reporting and analysis

Finance is about Gunns Ltd, a company in dealing with forestry products in Australia. The company has also been listed in Australian Stock Exchange. As many companies producing forestry products, even Gunns Ltd is facing various problems. Due to the ..

  A report on financial accounting

This report is specific for a core understanding for Financial Accounting and its relevant factors.

  Describe the types of financial ratios

Describe the types of financial ratios and other financial performance measures that are used during venture's successful life cycle.

  Differences between sole proprietorship and corporation

Briefly describe the major differences between a sole proprietorship and a corporation

  Prepare a cash budget statement

Calculate the expected value of the apartment in 20 years' time. What is the mortgage loan repayment at the beginning of each month

  What are the implied interest rates

What are the implied interest rates in Europe and the U.S.?

  State pricing theory and no-arbitrage pricing theory

State pricing theory and no-arbitrage pricing theory

  Small business administration

Identify the likely stage for each venture and describe the type of financing each venture is likely to be seeking and identify potential sources for that financing.

  Effect of financial leverage

The Effect of Financial Leverage and working capital management

  Evaluate the basis for the payment to the lender

Evaluate the basis for the payment to the lender and basis for the payment to the company-counterparty.

  Importance of opps, ipps, mpfs and dmepos

Research and discuss the differences and importance of : OPPS, IPPS, MPFS and DMEPOS.

  Time value of money

Time Value of Money project

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd