T or statutory minimum. These formulas make use of the functions Maximum x, y,.. The Maximum function returns the greatest value of all parameters separated by commas within the paranthesis. As an example, Maximum , , would return the value The Minimum function returns the least value of all parameters separated by commas within the paranthesis. As an example, Minimum , , would return the value of The If function checks a condition and if true uses formula y and if false formula z.
As an example If 20 would return the value Clients must have an account net liquidation value of at least USD 2, to establish or increase an existing uncovered options position. Short an option with an equity position held to cover full exercise upon assignment of the option contract. A long and short position of equal number of calls on the same underlying and same multiplier if the long position expires on or after the short position. A long and short position of equal number of puts on the same underlying and same multiplier if the long position expires on or after the short position.
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Long put and long underlying with short call. Put and call must have same expiration date, same underlying and same multiplier , and put exercise price must be lower than call exercise price. Two short options of the same series class, multiplier, strike price, expiration offset by one long option of the same type put or call with a higher strike price and one long option of the same type with a lower strike price. All component options must have the same expiration, same underlying, and intervals between exercise prices must be equal.
Two long put options of the same series offset by one short put option with a higher strike price and one short put option with a lower strike price. Two long call options of the same series offset by one short call option with a higher strike price and one short call option with a lower strike price. Long call and short put with the same exercise price "buy side" coupled with a long put and short call with the same exercise price "sell side". Buy side exercise price is lower than the sell side exercise price.
All component options must have the same expiration, and underlying multiplier. Buy side exercise price is higher than the sell side exercise price. Put and call must have the same expiration date, underlying multiplier , and exercise price. Long call and short underlying with short put. Put and call must have same expiration date, underlying multiplier , and exercise price. Pattern Day Trading rules will not apply to Portfolio Margin accounts. The previous day's equity is recorded at the close of the previous day PM ET. Previous day's equity must be at least 25, USD.
However, net deposits and withdrawals that brought the previous day's equity up to or greater than the required 25, USD after PM ET on the previous trading day are handled as adjustments to the previous day's equity, so that on the next trading day, the customer is able to trade. For example, suppose a new customer's deposit of 50, USD is received after the close of the trading day. Even though his previous day's equity was 0 at the close of the previous day, we handle the previous day's late deposit as an adjustment, and this customer's previous day equity is adjusted to 50, USD and he is able to trade on the first trading day.
Without this adjustment, the customer's trades would be rejected on the first trading day based on the previous day's equity recorded at the close. The system is programmed to prohibit any further trades to be initiated in the account, regardless of the intent to day trade that position or not. If an account receives the error message "potential pattern day trader", there is no PDT flag to remove. The account holder will need to wait for the five-day period to end before any new positions can be initiated in the account.
If the intraday situation occurs, the customer will immediately be prohibited from initiating any new positions. Customers should be able to close any existing positions in his account, but will not be allowed to initiate any new positions. Once the PDT flag is removed, the customer will then be allowed three day trades every five business days.
If an account gets re-flagged as a PDT account within days after the reset, the customer then has the following options:. Once the account has effected a fourth day trade in such 5 day period , we will deem the account to be a PDT account. If you wish to have the PDT designation for your account removed, provide us with the following information in a letter using the Customer Service Message Center in Account Management:.
If today was Wednesday, the first number within the parenthesis, 0, means that 0-day trades are available on Wednesday. The 2 nd number in the parenthesis, 0, means that no day trades are available on Thursday. The 3 rd number within the parenthesis, 1, means that on Friday 1-day trade is available. The 4 th number within the parenthesis, 2, means that on Monday, if 1-day trade was not used on Friday, and then on Monday, the account would have 2-day trades available. The 5 th number within the parenthesis, 3, means that if no day trades were used on either Friday or Monday, then on Tuesday, the account would have 3-day trades available.
Under SEC-approved Portfolio Margin rules and using our real-time margin system, our customers are able in certain cases to increase their leverage beyond Reg T margin requirements. For decades margin requirements for securities stocks, options and single stock futures accounts have been calculated under a Reg T rules-based policy.
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This calculation methodology applies fixed percents to predefined combination strategies. With Portfolio Margin, margin requirements are determined using a "risk-based" pricing model that calculates the largest potential loss of all positions in a product class or group across a range of underlying prices and volatilities. However, Portfolio Margin compliance is updated by us throughout the day based on the real-time price of the equity positions in the Portfolio Margin account.
Please note, at this time, Portfolio Margin is not available for U. Portfolio or risk based margin has been utilized for many years in both commodities and many non-U. Dependent upon the composition of the trading account, Portfolio Margin may require a lower margin than that required under Reg T rules, which translates to greater leverage.
Trading with greater leverage involves greater risk of loss. There is also the possibility that, given a specific portfolio composed of positions considered as having higher risk, the requirement under Portfolio Margin may be higher than the requirement under Reg T. Part of the reasoning behind the creation of Portfolio Margin is that the margin requirements would more accurately reflect the actual risk of the positions in an account.
Thus, it is possible that, in a highly concentrated account, a Portfolio Margin approach may result in higher margin requirements than under Reg T. One of the main goals of Portfolio Margin is to reflect the lower risk inherent in a balanced portfolio of hedged positions.
Conversely, Portfolio Margin must assess proportionately larger margin for accounts with positions which represent a concentration in a relatively small number of stocks. Under Portfolio Margin, trading accounts are broken into three component groups: Class groups, which are all positions with the same underlying; Product groups, which are closely related classes; and Portfolio groups, which are closely related products.
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The portfolio margin calculation begins at the lowest level, the class. All positions with the same class are grouped and stressed underlying price and implied volatility are changed together with the following parameters:.
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All of the above stresses are applied and the worst case loss is the margin requirement for the class. Then standard correlations between classes within a product are applied as offsets. Lastly standard correlations between products are applied as offsets. For stocks and Single Stock Futures offsets are only allowed within a class and not between products and portfolios. After all the offsets are taken into account all the worst case losses are combined and this number is the margin requirement for the account.
For a complete list of products and offsets, see the Appendix-Product Groups and Stress Parameters section at the end of this document. Our real-time, intra-day margining system enables us to apply the Day Trading Margin Rules to Portfolio Margin accounts based on real-time equity, so Pattern Day Trading Accounts will always be able to trade based on their full, real-time buying power.
Because of the complexity of Portfolio Margin calculations it would be extremely difficult to calculate margin requirements manually. Fixed Income. Mutual Funds.
Margin Requirements
You can change your location setting by clicking here. You can link to other accounts with the same owner and Tax ID to access all accounts under a single username and password. US Options Margin Overview. Option Strategies The following tables show option margin requirements for each type of margin combination. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money.
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