| Portfolio margin | Regulation T margin |
|---|---|
| Maintenance excess (buying power) = Net liquidation value – Margin requirements (minus non-portfolio margin eligible derivatives and non-marginable securities) | Margin equity = Stock + (+/– Cash balance) |
| There's no difference between initial and maintenance margins. | Maintenance margin = 50% initial for marginable securities |
| Treatment of volatility is applied to margin requirements. |
25% SRO* requirements; marginable long equities = 25% requirement; short equities = 30% requirement *SRO (Self- Regulatory Organization) |
|
Generally broad-based indexes: –15% and 15%; equities: +15% and –15%; allows up to 6.6 to 1 leverage (Some securities may be held at a higher base requirement, and some may not be portfolio margin eligible.) |
Schwab uses 30% minimum house maintenance requirement on short and marginable long equities. |
| Portfolio margin may allow for correlation and margin offsets between similar investments. | Options requirements computed in real-time using FINRA rules and fixed percentages. |
| Portfolio-margin-eligible options are marginable and can be used as collateral for other marginable positions. | Long options are not marginable and have a 100% requirement. |