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Maintenance margin A set minimum margin per outstanding futures contract that a customer must maintain in their margin account. Margin-equity ratio is a term used by speculators, representing the amount of their trading capital that is being held as margin at any particular time. The low margin requirements of futures results in substantial ...
Special memorandum account (SMA) [1] is a margin credit account used for calculating US Regulation T requirements on brokerage accounts. In addition to Initial Margin and Maintenance Margin requirements, the SMA ledger is used to lock in unrealized gains that augment the client's buying power. According to Regulation T, Section 220.5: [2]
If the initial margin requirement were 60%, then stock equity = $50 × 1,000 = $50,000 and leveraged dollars (or amount borrowed) = $50,000 × (100% − 60%) = $20,000. If the maintenance margin changed to 25%, then the customer would have to maintain a net value equal to 25% of the total stock equity.
Template: Month and year for maintenance templates. ... This template should always be substituted (i.e., use {{subst:Month and year for maintenance templates
Assessing whether increased maintenance costs will economically change the useful life of an asset. [10] Calculating how much should be invested in an asset in order to achieve a desired result (i.e., purchasing a storage tank with a 20-year life, as opposed to one with a 5-year life, in order to achieve a similar EAC). [11]
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SPAN is a portfolio margining method that uses grid simulation. It calculates the likely loss in a set of derivative positions (also called a portfolio), and sets this value as the initial margin payable by the firm holding the portfolio. In this manner, SPAN provides for offsets between correlated positions and enhances margining efficiency.
In contrast, if the market price of his contract has decreased, the exchange charges his account that holds the deposited margin. If the balance of this account becomes less than the deposit required to maintain the account, the trader must immediately pay additional margin into the account in order to maintain the account (a "margin call").