Question

In: Finance

If you ignore a margin call, your broker immediately:

If you ignore a margin call, your broker immediately:



Will seize all the assets in your account



May sell some of your securities to repay the margin loan



Will increase both your margin loan and the interest rate on that loan



Will let you walk away without paying



None of the above

Solutions

Expert Solution

May sell some of your securities to repay the margin loan when you ignore the margin call.

Because margin call means adding new funds to your margin account. Your brokerage firm can liquidate any securities without approval; if you do not meet the margin call, your brokerage firm can close out any open positions to bring the account back up to the minimum value.

hence answer is May sell some of your securities to repay the margin loan.

jeff jeffy answered 1 year ago
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