A Dealer Member's inventory contains conventional first mortgages valued at $1,200,000. If the chartered bank rate for these mortgages is currently 14%, what total margin must the dealer provide for this position?

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Accepted Answer

The rule is the greater of 12% or the bank rate (14%). $1,200,000 x 0.14 = $168,000.

A Dealer Member's inventory contains conventional first mortgages valued at $1,200,000. If the chartered bank rate for these mortgages is currently 14%, what total margin must the dealer provide for this position?

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