Playing defense on margin call as QTRH price drops?Some institutions do offer 50% margin loans on stocks under $3.
What if someone bought 200,000 QTRH at say $2.75, using $275,000 cash and a margin loan of $275,000, being 50% for the remaining $275,000 of the $550,000 cost?
Every penny drop in share price below $2.75 means a margin call of $1,000. If cash is not deposited by next day, the insitution can liquidate enough shares to cover the margin shortfall. The institution will do this at market price, often pushing the share price even lower.