单选题
An investor buys 200 shares of ABC at the market price of $100 on full margin. The initial margin requirement is 40 percent and the maintenance margin requirement is 25 percent. If the shares of stock later sold for $ 200 per share, what is the rate of return on the margin transaction?
【正确答案】
A
【答案解析】Step 1: Calculate All Cash Return:
Cash Return % = [(Ending Value/Beginning Equity Position)-1]×100=[($200×200)/($100×200)-1]×100=100%
Step 2: Calculate Leverage Factor:
Leverage Factor =1/Initial Margin %=1/0.40=2.50
Step 3: Calculate Margin Return:
Margin Transaction Return = All cash return × Leverage Factor =100%×2.50=250%
Note: You can verify the margin return as follows:
Margin Return % = [((Ending Value - Loan Payoff)/Beginning Equity Position)-1]×100=[(([$200×200]-[$100×200×0.60])/($100×0.40×200))-1]×100=[((40000-12000)/8000)-1]×100=250%