Brokerage
Margin Requirements & Rates
Initial Account Balance
Minimum Maintenance Requirements
Intraday Buying Power
Margin Rates & Discounts
Margin Requirements
Initial Account Balance: $30,000
Minimum Maintenance Requirements (Overnight):
Long Stocks < $3.00 = 100%
Long Stocks > $3.00 but < $5.00 = 50%
Short Stocks < $5.00 = 100% or $2.50 a share (whichever is greater)
Cash Positions = 100%
Non-Volatile Short = 30% or $5 a share (whichever is greater)
Non-Volatile Long = 25%
Intraday Buying Power:
Variance Trading and the clearing house offers Intraday buying power of 25% ( X 4 Buying Power ).
Intraday Buying Power is the amount of funds you can use to purchase stock intraday. Overnight Buying Power is the amount of funds you can use to hold stock overnight
Day Trade Buying Power Calculation
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+ Market Value of long options
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- Market value of short options
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- Market value of long options
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+ Market value of short options
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- Maintenance Requirement
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= DTBP (Day Trading Buying Power)
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| Definition of Terms For the definitions we will use an example of a fully paid for position of 1000 -shares of XYZ trading at $80. |
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total of the price X the quantity of your marginable stocks. Market Value: 1000 X 80 = 80,000.
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Margin Value - loans = 80,000. in the example, your Margin Equity is 80,000 since your position is fully paid for.
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Maintenance Requirement is 25% of the Margin Value. Hence in the example above: Maintenance Requirement = 20,000).
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Maintenance Excess requirement is: Margin Value - Maintenance Requirement or 80,000 - 20,000 = 60,000.
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Day Trading buying power is defined as twice your Excess Req. hence 2 X 60,000 = 120,000.
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Reg T buying power is defined as additional purchasing power that will result in your equity being not less than 50%. Hence your RegTBP is 80,000 since if you buy an additional 1000 shares of XYZ at 80.
Loan = 80,000
Equity = 160,000 - 80,000 = 80,000
and Equity divided by MarketValue = 50%.
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The OverNite buying power is defined as the buying power you have if you intend to carry any positions over night. It is computed as being the lesser of DayTradeBP and RegTBP.
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Margin Rates & Discounts
Trading on margin gives you extra buying power to get into the positions you want. If you need leverage, we offer discounts on margin interest rates based on your margin debit balance.
Exact margin rates are based on the Current Clearing House Debit Rate and change frequently. Please contact a sales representative for the most current rates.
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