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An option is sold short (call and put). The required margin is $20,000. The cost of...

  1. An option is sold short (call and put). The required margin is $20,000. The cost of margin debt is 8%/ year. The position is held for 45 days. What is the cost of margin?
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Answer #1

Cost of Margin = Margin* Cost of Margin*45/365 = 20,000 * 8%*45/365 = 197.26

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