Margin calls    

 A margin call occurs when the value of a margin account falls below the required margin requirement.

Learn about the different types of margin calls and what to do if you get one.

 

Cash Call: Incurred by exceeding accounts cash available on an opening transaction

 

Due Date: Cash calls are due T+5

 

This call can be met by:

 

1. Deposit of cash in the entire amount of the call
2. Deposit of security(ies) equal to the entire amount of the call

 

Other Notes: Account will be limited to closing transactions if another violation occurs within the 90-day restriction period

 

Day Trade Call: Incurred by exceeding your Day Trading Buying Power to satisfy the initial requirement on Day Trading transaction

 

Due Date: Day trade calls are due T+5, buying power will not be restored until the call is met

 

This call can be met by:

1. Deposit of Cash in the entire amount of the call
2. Deposit of margin eligible securities valued at (1.33 * the entire amount of the call)

 

Other Info: Money deposited to pay for this call must remain in the account for two days before being withdrawn. This type of call cannot be met by liquidation.

 

Equity Maintenance Call: Incurred by having Pattern Daytrade account equity fall below $25,000 minimum. You will be restricted to closing transactions only until account equity reaches $25,000.

 

Due date: At any time

 

This call can be met by:

 

1. Deposit of cash in the entire amount of the call
2. Deposit of security(ies) equal to the entire amount of the call
3. Market appreciation

Other Info: Thirty days after the last day trade you can request your account be coded as a Non-Pattern Day Trading account as a one-time exception. As a NPDT, your account is limited to 3-day trades (based on opening transactions) in a 5-business day rolling period. If at any point after requesting this status you make more than 3-day trades in a rolling 5 business day period in the account, the account will automatically be re-coded as a Pattern Day Trader and subject to a minimum equity balance of $25,000.

 

 

Maintenance Call: Incurred by having account equity below minimum maintenance requirements for open positions.

 

Due Date: Maintenance calls are due T+3

 

This call can be met by:

1. Deposit of cash in the entire amount of the call
2. Liquidation of margin eligible security(ies) valued at 4X amount of call
3. Liquidation of non-margin eligible security(ies) equal to the amount of call
4. Market appreciation

 

Accounts with less than 20% margin equity are due in 1 business day. Calculations mentioned above for meeting calls are based on zero account depreciation and will have to be increased if account subsequently loses value.

 

Maintenance calls are generally subject to liquidation on T+4. However, the broker can use its discretion to liquidate securities any time after the issuance of the margin call to protect its financial interest, without notice to the customer.

 

Other Info: If the call is not met, positions will be liquidated to satisfy the maintenance call.

 

Portfolio Margin Maintenance Call: Incurred by having account equity below house maintenance requirement for open positions.

 

Due date: T+2

 

This call can be met by:

 

1. Deposit of cash in the entire amount of the call
2. Liquidation – Liquidation to meet these calls can only be done twice per year unless the negative excess amount is attributed to adverse market movements. On the third instance of liquidating to meet a portion or all a call not attributed to adverse market movements, the account will be restricted to cash on hand for a period of 90 days.
3. Market appreciation

 

Portfolio Margin Minimum Equity Call: Incurred by having Portfolio margin account equity fall below $150,000 minimum.

 

Due Date: T+1

 

1. Deposit of cash in the entire amount of the call
2. Deposit of security(ies) equal to the entire amount of the call
3. Market appreciation

 

Other info: PM accounts must always maintain an equity balance of $150,000 or else PM status will be removed. If PM status is removed, the account would have to wait for 90 days before restoring PM status and meeting the PM minimum equity.

 

Portfolio Margin Leverage Call: Incurred by the total market value of positions exceeding approved multiple.

 

Due Date: T+2

 

This call can be met by:

 

1. Any combination of deposit, appreciation or liquidation which reduces the ratio of equity to a market value below your approved multiple

Other Info: Liquidation can only be used twice per 90-day period to meet this call. On the third instance of using liquidation to meet this call, the account will lose PM status.

 

Portfolio Margin Maintenance Regulatory Call: Incurred by Account equity being below regulatory maintenance requirement for open positions.

 

Due Date: T+1

 

This call can be met by:

 

1. Deposit of cash in the entire amount of the call
2. Liquidation – Liquidation to meet these calls can only be done twice per year unless the negative excess amount is attributed to adverse market movements. On the third instance of liquidating to meet a portion of, or all a call not attributed to adverse market movements, the account will be restricted to cash on hand for a period of 90 days.
3. Market appreciation

 

Other Info: Deposits or liquidation amounts to meet calls must be increased if the account subsequently loses value. Strikes caused by liquidations out of PM house or regulatory calls will remain on the account for a period of 90 days.

 

Reg-T Fed (Initial) Call: Incurred by insufficient overnight buying power (ONBP) to satisfy the initial requirement on opening transactions held overnight. Under Federal Reserve Board Regulation-T, you can borrow up to 50 percent of the total purchase price of a stock for initial opening transactions.

 

Due Date: Reg T calls are due T+5

 

This call can be met by:

1. Deposit of cash in the entire amount of the call
2. Deposit of Margin eligible security(ies) valued at 1 1/3 the call amount
3. Liquidation of Margin eligible securities valued at 2X the call amount

 

Please Note: Liquidation can be used to meet the call but can only be used twice during a rolling year to meet an Initial (Reg- T) call. In the 3rd instance, your account will be in restriction and limited to cash on hand for a period of 90 days.

 

Other Info: If the call is not met, positions will be liquidated to satisfy the initial call.