Initial margin


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Initial margin

(1) Amount of money deposited by both buyers and sellers of futures contracts to ensure performance of the terms of the contract; (2) amount of cash or eligible securities required to be deposited with a broker before engaging in margin transactions.

Initial Margin

The money or securities an investor keeps in a margin account in order to be able to borrow from a brokerage for short sales or other purposes. The initial margin requirement is kept as collateral until the brokerage calls the margin and the client pays back what is owed. FINRA requires that the initial margin requirement kept must be at least 25% of the amount borrowed, while some brokerages have initial margin requirements of up to 50%.
References in periodicals archive ?
Initial margin is intended to cover possible losses incurred by the remaining counterparty after default, as it goes about liquidating or replacing the defaulted position.
Just as serious was the problem of gridlock in the flow of mark-to-market variation settlements and initial margin requirements.
At Rs 1,253 per kg on 25 April 2012, an investor would have had to pay an initial margin of Rs 63 (5 per cent) to buy one unit (one kg) of the metal that day.
Treasuries, and--for initial margin only--some agency bonds.
23 that initial margin for COMEX gold futures would rise by 21 percent.
The margins determine how much you can borrow to buy silver futures – the lower the initial margin, the more you can borrow.
9) Although this relationship between margin status and local recurrence is well documented, relatively few studies have correlated the initial margin status for lumpectomies and excisional biopsies with the frequency of residual invasive carcinoma in the reexcision specimens.
Free equity the money you have on deposit with which you aren't currently using to trade with as initial margin (also variation margin).
The Sukuk will pay an expected return at a rate of 6% per annum, payable semi-annually in arrear from (and including) the issue date for a period of five years, and thereafter at a rate, reset and payable semi-annually in arrear, reflecting the initial margin above the then prevailing six month Emirates Interbank Offered Rate.
The financing is at an initial margin of 255 bps to EURIBOR per annum and is amortized based on an underlying tenor of 18 years.
They margin trading was approved after making some amendments to the system that decide the percentage of the initial margin and the maintenance margin, as well as following an in-depth study on the best systems and practices in global stock markets.

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