In this question there is a situation where it states …but does post variation margin sufficient to make any maintenance margin calls… So one does the goofy little margin chart thingy and gets the question wrong because as the text states and every other problem states, one marks everything to market and then when the $ fall below the maintenance margin, we deposit funds to get it back to the initial margin. One gets the problem wrong. In the test on page (cfai ) 56 it states "in the second full paragraph when the money in the margin account falls below maintenance margin, "…the tader must deposit sufficient funds to bring the balance back up to the initial margin requirement. Why would CFAi have a problem that directs us to deposit funds to bring us back up to maintenance margin when that is apparently NEVER the case? Frustrated…
I have solved the problem and it seems okay … can u explain it in more detail? I have contructed the mark to market and there is no mistake … you dont get the problem wrong.
The main question I have is why they are using the maintenance margin as where they have to catch their money up to in a margin call…In every other problem, and according to the text, if you receive a margin call, you are to pay your margin back up to INITIAL margin not MAINTENANCE. Is this just a “throw you for a loop” question, or is there something else I am missing?
post your margin table here …