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Basic Question 4 of 16
The minimum margin that must be supplied when a margin transaction is created is the ______.
B. initial margin
C. call margin
A. maintenance margin
B. initial margin
C. call margin
User Contributed Comments 3
| User | Comment |
|---|---|
| achu | Remember, initial margin may be higher than the maintenance margin! |
| johntan1979 | Shouldn't initial margin ALWAYS be higher than maintenance margin? Otherwise, you will already get a margin call even before you get started. |
| irapp92 | @johnatn1979 yes, it would make no logical sense to be anything but. I believe the current boilerplate requirements are initial margin (reg T) of 50% and a minimum maintenance margin of 25% for long positions. |
You have a wonderful website and definitely should take some credit for your members' outstanding grades.
Colin Sampaleanu
Learning Outcome Statements
compare positions an investor can take in an asset
calculate and interpret the leverage ratio, the rate of return on a margin transaction, and the security price at which the investor would receive a margin call
CFA® 2024 Level I Curriculum, Volume 3, Module 1.