Examlex

Solved

A Margin Call Occurs When the Value of the Borrowed

question 3

True/False

A margin call occurs when the value of the borrowed money as a proportion of the portfolio value is too high.This ratio is typically known as the value to loan ratio.


Definitions:

Conversion Premium

The additional amount that an investor pays over the current market price to convert a convertible security into a predetermined number of common shares.

Conversion Ratio

The specified number of shares that can be converted from a convertible security.

Current Market

The existing state of the market, including current prices, volumes, and trends, reflecting the most recent period of trading.

TIPS Bond

Treasury Inflation-Protected Securities (TIPS) are U.S. government bonds that are indexed to inflation in order to protect investors from the negative effects of rising prices.

Related Questions