Series 7 - General Securities Representative Exam

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Your customer wants to short a stock in his margin account. The stock is trading at $2.08 per share. He thinks it will go down further in price. What is the minimum maintenance margin requirement, assuming no other positions are held in the account?

$3.12 per share
A
$1.25 per share
B
$2.08 per share
C
$2.50 per share
D

Explanations

For stocks trading below $5.00 per share: the maintenance margin for shares of stock sold short is $2.50 per share or 100% of the current market value, whichever amount is greater. $2.50 per share is the correct answer

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