Maintenance margin


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Related to Maintenance margin: margin call

Maintenance margin

For derivative contracts, when the margin drops below the maintenance margin, the investor gets a margin call. The investor must post margin to the initial margin (which is higher than the maintence) or the contract will be liquididated.

Maintenance 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 maintenance is kept as collateral until the brokerage calls the margin and the client pays back what is owed. FINRA requires that the maintenance kept must be at least 25% of the amount borrowed, while some brokerages require maintenances of up to 50%. See also: Restricted account.
References in periodicals archive ?
However, the minimum maintenance margin requirement for the account is 25%, meaning that the customer's equity must not fall below $15,000 ($60,000 market value multiplied by 25%).
Where an investor's broker uses a safety margin in lieu of the industry's maintenance margin, the former should substitute for MM in Equation (1).
Gross margin as a percent of revenues increased to 52 percent from 51 percent in fiscal 2008 due to a higher mix of maintenance revenues to total revenues and an increase maintenance margin which offset a lower consulting margin.
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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