Question

"A customer who has a fully paid long position in ABC stock goes "short against the box" for a credit to his account of $50,000. ABC is a NASDAQ stock. The minimum maintenance margin requirement is:"

Answer 1

Answer: 2500

Step-by-step explanation:

From the question, we are informed that acustomer who has a fully paid long position in ABC stock goes "short against the box" for a credit to his account of $50,000 and that ABC is a NASDAQ stock.

Then, to get the minimum maintenance margin requirement, we should know that FINRA has a 5% minimum maintenance margin on the long side. This will then be:

= 5% of 50,000

= 5% × 50,000

= 2500 minimum