Margin Requirement Calculator (Reg T + Maintenance)
Margin requirement calculator. Reg T initial margin (50%), FINRA maintenance margin (25-30%), buying power, and margin-call trigger price. For long and short stock positions.
Margin Requirement Calculator
How to use the margin requirement calculator
Choose long or short
Long: buying stock with margin. Initial margin 50% per Reg T means you pay 50% cash and the broker lends 50%. Short: borrowing stock to sell. Initial margin still 50% — you must deposit 50% of the short position value to cover the borrowed stock's rise risk.
Enter stock price + shares
Current market price and the number of shares you're trading. Position value = price × shares. For Reg T initial margin: position value × 50% is the cash you need. Pattern Day Trader rule requires >$25K equity for active intraday trading.
Adjust margin % if needed
Default: Reg T 50% initial / 25% maintenance for long. Brokers can impose higher requirements (called "house margin") for volatile stocks, low-priced stocks, or specific tickers. Schwab/Interactive Brokers tighten requirements for stocks < $5, recently-IPO'd names, biotechs near catalysts. Check your broker's margin requirement screen for the actual %.
Enter cash available
Used to compute buying power (2× cash at 50% initial) and max shares purchasable. Cash buying power = cash / (initial margin %). Don't deploy all buying power — leaving 30-50% unused gives you margin to absorb adverse moves before getting margin-called.
Read margin call price
Critical number. For long positions: the price the stock can fall to before your equity drops below maintenance %. For shorts: the price the stock can rise to. Beyond margin call, broker will (a) demand additional capital deposit within 3 business days, or (b) liquidate the position automatically. The "cushion %" shows how much of a move you can absorb.
Margin — how brokers lend you money to amplify trades
Margin in stock trading is essentially a loan from your broker, secured by the securities in your account. Regulation T — set by the Federal Reserve Board in 1934 after the 1929 crash exposed dangerous leverage — caps initial margin at 50% of the purchase value for stocks. Translation: with $10K of your own cash, you can control $20K of stocks. FINRA Rule 4210 sets maintenance margin (the floor you must maintain) at 25% for long positions and 30% for short positions of most stocks. Brokers often impose stricter "house" requirements on volatile or low-priced stocks. The calculator above shows you the exact margin needed, the loan amount you\'ll carry, and — most importantly — the margin-call trigger price.
Why margin matters even if you don\'t use it
Every retail brokerage account is technically a "margin account" by default. Even if you never intend to borrow, understanding margin matters because: (1) Cash sweep — uninvested cash may be lent out by your broker. (2) Settlement timing — T+2 settlement means selling stock and immediately buying with the proceeds technically uses margin until settlement. (3) Pattern Day Trader rule — accounts under $25K can\'t make >4 day-trades per 5-day period; this rule exists because of margin abuse. (4) Margin call risk — even cash accounts can have surprises (option assignment, settled cash held back). Every retail trader should understand the calculator above before clicking "buy".
The 1929 crash was largely a margin crash — leveraged investors couldn\'t meet margin calls, banks called loans, cascade liquidations followed. Reg T (1934) cut maximum leverage in half. Most brokers still cap retail leverage at 2:1 today.
Margin costs — the silent return killer
Margin loans are NOT free. Brokers charge interest on the borrowed portion — typically 8-12% annualised for retail accounts (more than mortgage rates because of higher credit risk on margin loans). Interactive Brokers, with its low margin rates, often shows 5-8% — but most retail brokers (Schwab, Fidelity, Robinhood) charge 9-13%. This margin interest is a real drag on returns. Borrowing $50K at 10% costs $5K per year — your stock position needs to outperform by 10% just to cover the interest before any "leverage benefit". For long-term investors, margin is rarely worth the cost. For short-term traders capturing 30-50% annualised, margin can boost net returns substantially.
ASEAN margin context
Margin rules differ by country. Singapore: MAS / SGX requires 30% initial margin for SGX-listed stocks; up to 90% for popular CFD platforms (much higher leverage but with higher risk). Malaysia: Bursa requires 50% initial margin similar to US Reg T. Hong Kong: HKEX has no fixed Reg T equivalent; brokers set their own house margin (typically 30-50%). Australia: ASX margin requirements 30-50% depending on stock liquidity. Indonesia: IDX requires 50% initial margin similar to US. Across ASEAN, brokers are increasingly tightening retail margin access following 2020-2022 retail-trading-related losses.
10 Things to Know About Margin
Reg T (1934): Federal Reserve\'s 50% initial margin cap. Created after the 1929 crash exposed dangerous leverage.
FINRA Rule 4210: 25% long / 30% short maintenance margin. The floor you must maintain.
House margin: brokers can require MORE than Reg T (volatile stocks, low-priced stocks, recent IPOs).
Margin call: broker demands deposit within 3 business days OR forces liquidation. Forced liquidation often happens at the worst time.
Buying power = cash / initial margin %. $10K cash → $20K buying power at Reg T 50%.
Pattern Day Trader rule: accounts <$25K can\'t do >4 day trades per 5-day period.
Margin interest: 8-12% typical. Interactive Brokers 5-8%; Robinhood, Schwab, Fidelity 9-13%.
Short selling requires margin. Even cash accounts can\'t short — you need a margin account.
Portfolio margin (PM) for accounts >$125K: risk-based requirements; usually MUCH lower than Reg T.
Day trading buying power = 4× equity (Reg T); overnight = 2× equity. Overnight risk is what brokers really hate.
Frequently asked questions
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Three options. (1) Deposit cash or securities within 3 business days to restore minimum equity. (2) Sell positions to reduce your loan, restoring the maintenance ratio. (3) Do nothing — your broker will liquidate positions at THEIR discretion, often at adverse prices, often without warning. Most brokers default to option 3 if you don\'t act. The 2020 March Reddit / "house of cards" episodes saw brokers force-liquidate underwater retail traders during volatility spikes. Don\'t get into a margin call situation — keep the cushion comfortable.
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Three reasons. (1) Risk-based pricing — retail margin loans have higher default risk than mortgages because the collateral (stocks) can drop 30%+ overnight. (2) Operational cost — brokers manage daily mark-to-market, margin calls, and forced liquidations. (3) Profit center — margin lending is one of the most profitable brokerage products. The spread between what brokers pay for funding (Fed funds rate) and what they charge retail is often 5-8%, vs 0.5-1% for mortgages. Interactive Brokers, which prices margin loans more aggressively, undercuts most competitors substantially.
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For options strategies + hedged portfolios: very much yes. Portfolio margin (PM) calculates margin based on the entire portfolio\'s risk under stress scenarios (typically ±15% stock moves with parallel IV moves). A hedged iron condor that requires $1,000 under Reg T might require only $200-400 under PM. Requires $125K minimum equity, options approval level 4, and broker approval. For directional cash accounts: PM offers little benefit. For options-heavy accounts: PM can free up 60-80% of buying power, materially boosting capital efficiency.
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Yes. Brokers can raise house margin requirements at any time — typically for newly volatile names, pre-earnings, or in response to corporate events. The infamous example: in January 2021, Robinhood + others raised GameStop margin to 100% (no leverage), effectively forcing forced selling. Brokers don\'t need to notify you — check your account regularly during stress periods. For more stable accounts (large diversified equities, blue-chip ETFs), margin requirements rarely change.
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Yes — three reasons. (1) Higher maintenance margin (30% vs 25% long). (2) Borrow fees for hard-to-borrow stocks (HTB list). Heavily-shorted stocks can have annual borrow fees of 20%-200%. (3) Dividends — short seller must pay any dividends the underlying pays out, reducing returns. Add it up: shorting can be 20%+ more expensive annually than going long the same dollar amount. This is why successful short sellers tend to focus on either short-term gambles (binary catalysts) or fundamentally broken structural shorts (frauds, dying businesses).
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Regulation T is a Federal Reserve Board rule (12 CFR Part 220) created by the Securities Exchange Act of 1934. It governs the extension of credit by brokers and dealers for securities transactions. The headline rule: initial margin on US equities is 50% of purchase value. Reg T also covers cash account settlement rules, free-riding, and various securities-lending mechanics. The 50% number has been unchanged since 1974 — a deliberately conservative cap that limits systemic risk in retail markets.
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No — this is for STOCK margin only. Options margin is more complex: Long options require 100% cash (no margin). Cash-secured puts require 100% of the strike × 100 in cash. Naked short options have complex CBOE-set formulas typically requiring 20% of underlying value plus the option premium. Defined-risk spreads require margin equal to max loss. For options margin, use your broker\'s position-specific margin calculator. Our iron condor calculator (RT-FIN-235) shows the approximate Reg T margin for a 4-leg iron condor.
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Because this is the single most important number for any leveraged position. The math: for a long position, margin call triggers when equity / market value drops below maintenance %. As the stock falls, your loan stays constant (you owe what you borrowed) but the collateral shrinks, so the equity ratio collapses. Knowing this trigger price BEFORE you open the position is the difference between informed risk-taking and getting blown out. Set a stop-loss above the margin call price to avoid forced liquidation — manage your position before the broker has to.
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No. Position type, price, shares, cash — every input stays in your browser. Margin computations run entirely client-side. Open DevTools → Network when you click Calculate and you\'ll see zero outbound requests.
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Federal Reserve Regulation T — 12 CFR Part 220, the source document. FINRA Rule 4210 — maintenance margin requirements. SEC Investor Bulletin on margin (sec.gov/investor/pubs/margin.htm) — plain-English consumer guide. CFA Level 1 Equity Investments has full margin coverage. Modern broker margin documentation: Interactive Brokers, Schwab, Fidelity, TD Ameritrade all publish detailed margin requirement matrices for their specific products.
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