Margin Accounts: Rapid Fire

What this video covers

• The three-layer margin hierarchy: Federal Reserve initial margin, Financial Industry Regulatory Authority (FINRA) maintenance minimums, and firm house rules (firm can require more, never less)
• Long equity calculation: Long Market Value (LMV) minus Debit Balance (DB), and why the debit balance is fixed while only equity fluctuates with market moves
• Short equity calculation: Credit Balance (CR) minus Short Market Value (SMV), and why short maintenance demands a 30% cushion against theoretically infinite risk
• The two most tested trigger price formulas: Debit Balance divided by 0.75 for long positions, Credit Balance divided by 1.30 for short positions
• SMA as a high-watermark line of credit: why it survives market declines, drops only on customer actions, and converts to $2 of buying power per $1 of SMA at the 50% Regulation T rate
• The critical distinction between restricted equity (below 50% initial margin, limits new purchases) and maintenance calls (below 25% long / 30% short, forced liquidation without notice)
• Pattern day trader requirements: both the 4+ day trades in 5 business days AND the greater than 6% of total trades conditions must be met, plus the $25,000 minimum equity