ProcessIntermediate
What is the formula for computing equity in a short margin account according to the chapter?
The formula for computing equity in a short margin account is: Credit balance minus Market value short equals Equity.
Key points
- Credit balance is the total proceeds from the short sale plus the required margin deposit.
- Market value short is the total market value of the securities sold short.
- Equity is calculated as Credit balance - Market value short.
Source:Boston Institute of Finance Stockbroker Course: Series 7 and Series 63 Test Preparation· Types of Securities· p. 198–201
Related questions
Boston Institute of Finance Stockbroker Course: Series 7 and Series 63 Test Preparation
Boston Institute of Finance
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