What is position margin?

Position margin is the amount that an investor uses brokers borrowing money to purchase securities is the minimum amount to be maintained in the account. This provides the broker with a guarantee that investors repayable debt.

Where have you heard of position margin?

Immediately after borrowing from a broker, an investor is required to provide a position margin, usually 25% of the total value of the securities purchased by the loan.

What you need to know about the position margin...

Position margin provides protection for funds lent to investors by brokers. If the investor allows his account. Share capital if it falls below the position margin, the broker will issue a warning of a liquidation and force the closing of the position until the investor increases the amount of equity. Share capital may be in the form of cash or shares.

Since the stock price may fall, the position margin is a certain percentage of the value, so it is not a fixed amount.

Your broker's financial regulatory regulations and policies dictate the amount of position margin in an individual's account.