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Margin Position in a Stock After a Short Sale

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Recently, you sold 1,000 shares of stock for $21,400. The sale was a short sale with an initial margin requirement of 60 percent. The maintenance margin is 30 percent. The stock is currently trading at $27.50 a share. What is your current margin position in this stock?

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Solution Summary

The solution determines a margin position in stock after a short scale.

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We have,

Shares sold=1,000
Value of the stock=$21,400
Price per share=$21.4
Initial margin ...

Solution provided by:
Jayant Kumar, MBA
Education
  • MBA, Indian Institute of Finance
  • Bsc, Madras University
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