Tim: re:I have about $12,000 in my account now with no margin but no cash. If I put in another $1000 and bought say $1500 of AMD how would my margin requirement be calculated?
I assume from your sentence that you mean you have $12,000 worth of stock in your account, and have no cash in the account, but also are not margined at all. Depending on the margin requirements for the stock you own (usually 50%), your available margin will vary. If it is 50%, then you can buy up to $12,000 more in 50% marginable securities, for a total of $24,000 worth of stock in your account (with $12,000 on margin [loan]). Your balance would still be $12,000 ($24,000 stock - $12,000 loan).
If you add $1000 cash in your account, your balance will go up to $13,000 ($12,000 securities, $1000 cash) and you will be able to buy an additional $14,000 worth of 50% marginable security.
If you had $10000 in an account and brought $2000 of XYZ stock, putting up $1000 of cash and your margin requirement was 50% would you get a margin call if the stock went down at all or only if the value of your entire account went down to $1000 or less?
This scenario doesn't make too much sense to me...
If you have $10,000 in a margin account, and you bought $2000 worth of stock, and added another $1000 cash to it, your balance is $11,000, with $2000 of it consisting of stock. Even if the stock became completely worthless, your balance will be $9000. You will never get a margin call, because you're not using any margin.
Maybe you can clarify your question a little bit more...
Sam |
