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Gold/Mining/Energy : Strictly: Drilling and oil-field services
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To: Think4Yourself who wrote (51869)9/26/1999 9:41:00 AM
From: diana g  Read Replies (1) of 95453
 
re: Margin Calls

Hi K,
In regard to that $5 margin cut-off point, I think maybe this is one of those areas where different brokerages do it differently.
-- I was told that my broker will not allow one to buy stocks priced under $5 for a margin account, but that once the stock is in the account the price per share is no longer a factor --except to calculate equity proportion, of course.
eg-- if I start with all cash and I max out my margin buying XYZ @ $5 1/8, I won't get a margin call if XYZ goes down 1/4. I'm safe from a margin call unless my account equity drops below 30%. (Leaving aside the issue of being concentrated all in one stock, which would affect margin requirements also.)

I though I would mention this to you since you have situations where this could make an important difference. Perhaps a different broker would suit you better?
Of course I may be completely wrong. Wouldn't be the first time.<G>

btw, thanks for the response and all your posts! Always worth reading.

regards,
diana
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