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Arte-miy333 [17]

3 years ago

10

Assume you short sell 100 shares of IBM common stock at $125 per share. If the initial margin is 70%, what is the amount that yo

u put in as cash buffer?a) $3750b) $12500c) $5000d) $8750

1 answer:

zhuklara [117]3 years ago

3 0

Answer: d) $8750

Explanation:

The Cash buffer is also the margin of the total value of the stock.

= Initial margin * Investment value

= 70% * (125 * 100)

= 70% * 12,500

= $8,750

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1 year ago

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