Maintenance Margin Requirements

What this video covers

• The FINRA minimum maintenance requirements: 25% of long market value (LMV) for long accounts and 30% of short market value (SMV) for short accounts, plus why short selling demands a higher cushion
• The long account trigger price formula: debit balance (DR) divided by 0.75, and how to derive it from the equity equation at the maintenance threshold
• The short account trigger price formula: credit balance (CR) divided by 1.30, and why the denominator uses 1 plus the maintenance percentage for short positions
• The dollar-amount floor rules for low-priced short stock, including the greater of $2.50/share or 100% of market value under $5, and the greater of $5/share or 30% of market value at $5 and above
• The separate floor rule for short bond positions: the greater of 5% of principal amount or 30% of current market value
• Firm actions when a customer fails to meet a maintenance call, including immediate liquidation without notice and the absolute prohibition on using another customer's account
• The exam distinction between a Reg T initial call (50% of new purchase, T plus 2 deadline) and a maintenance call (triggered by market movement, prompt liquidation possible), plus why a restricted account is not the same as a maintenance call