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User Generated
Subject
Finance
School
Howard College
Type
Homework
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Responses
Student’s Name:
Institutional affiliation:

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Response to classmate 1
I am intrigued by how you have calculated and explained the margin call. On top of this, you have clearly
elucidated the actions a broker can utilize to meet the margin call. Your company of choice is Microsoft,
which is an excellent selection. Nonetheless, when you say the board of governors at the Federal Reserve
has the authority to dictate the initial margin, it affirms in-depth research and understanding on the subject
topic. You go ahead to prove this when you reveal the historical margin for stocks has remained at 50%
since 1974. I also like when you highlight the formula whereby it is essential as a guide to working out
the initial margin. In addition, you state that when a broker wants to meet the margin call, they need to
have a maintenance margin of 30%. This is also an affirmation the approach you chose is an effective one
since there will always be a security in case things go wrong. I am also delighted to learn that this
decision sees to it that even if there are losses and an investor took money from a broker, then the amount
must be replaced. As for me, I view this as a learning phase where one can utilize the strategies even in a
real-life situation.
Response to classmate 2
Your selection of JP Morgan Chase as your company of choice is excellent. I am delighted to see how
you calculate the margin whereby you explain it on a step-to-step basis. When you reveal the statement
that the initial margin must be realized when a transaction is initiated, and the maintenance margin is met
on an ongoing basis, it reveals a deep understanding of the topic. Therefore, with such understanding, one
gets an ideal approach to make all the necessary calculations. As for you, you have done all the
transactions in detail, whereby after going through all of them, one looks at the initial margin and
maintenance margin from a new perspective.
When it comes to the actions that brokers can make when making margin calls, you have elucidated it in
detail. I like it when you bring the concept of trading margin whereby investors can use them as leverage.
As a result, they increase their buying power while using either cash or stocks as security. Notably, I am

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Responses Student’s Name: Institutional affiliation: Response to classmate 1 I am intrigued by how you have calculated and explained the margin call. On top of this, you have clearly elucidated the actions a broker can utilize to meet the margin call. Your company of choice is Microsoft, which is an excellent selection. Nonetheless, when you say the board of governors at the Federal Reserve has the authority to dictate the initial margin, it affirms in-depth research and understanding on the subject topic. You go ahead to prove this when you reveal the historical margin for stocks has remained at 50% since 1974. I also like when you highlight the formula whereby it is essential as a guide to working out the initial margin. In addition, you state that when a broker wants to meet the margin call, they need to have a maintenance margin of 30%. This is also an affirmation the approach yo ...
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