Chapter 18: Margin

Chapter summary

Chapter 18 covers margin: how accounts work, what Regulation T requires, and how to calculate equity, maintenance margin calls, and buying power. Reg T requires 50% initial margin on equity purchases. Minimum maintenance is 25% for long positions, 30% for short. When equity falls below maintenance, a margin call is issued. The SMA records excess equity above Reg T, representing buying power. Pattern day traders must maintain $25,000 equity.

Key concepts

• Margin
• Regulation T
• Opening a Margin Account
• Basics of Long Margin Positions
• Basics of Short Margin Positions
• Combined Long and Short Positions
• Margin Requirements for Other Securities
• Other Margin Customers
• Regulation T
• Opening a Margin Account
• Basics of Long Margin Positions
• Basics of Short Margin Positions

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