margin requirement

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margin requirement

margin requirement that part of a security's price that a buyer must pay for in cash. The balance of the price is met by the broker, who, in effect, is supplying a client with a loan. The smaller the margin, the greater the inducement to speculation. Low margin requirements were considered an important cause of the 1929 collapse of the American stock market. In 1934, the Securities Exchange Act gave the Federal Reserve Board the power to regulate margin requirements. The amount has been reset at various times, but in recent years, the Federal Reserve has instituted a 50% margin requirement with a $2,000 minimum.

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maintenance margin

A Dictionary of Business and Management | 2006 | Â© A Dictionary of Business and Management 2006, originally published by Oxford University Press 2006. (Hide copyright information) Copyright

maintenance margin The minimum margin required in a brokerage account by a particular exchange or brokerage firm.

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Free newspaper and magazine articles

	The adequacy and consistency of margin requirements in the markets for stocks and derivative products. (Staff Study) Newspaper article from: Federal Reserve Bulletin; 9/1/1989
	BrokerTec Futures Exchange Reduces Customer Margin Requirements by Adopting Inter-Market Spread Credits. Business Wire; 9/25/2002
	The Bank of New York, Chicago Mercantile Exchange Introduce New Collateral Management Program to Help Members Meet Margin Requirements. Business Wire; 8/19/2002

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Related articles from newspapers, magazines, and more

	Margin Requirements, Margin Loans, and Margin Rates: Practice and Principles.(analysis of history of margin credit regulations)(Statistical Data Included) Magazine article from: New England Economic Review; 9/1/2000; ; 700+ words ; ...history and practice of margin requirements as well as the accounting...the extent to which initial margin requirements restrict the amount of margin lending. We argue that the maximum amount of margin debt is less than would obtain if only maintenance margins were in force, ...
	Margin requirements across equity-related instruments: how level is the playing field? Magazine article from: New England Economic Review; 1/1/2003; ; 700+ words ; ...others might have higher margin requirements; still others might differ...demonstrates that, in the absence of margin requirements, strategies using options...and returns, differences in margin requirements might create incentives to...
	Marginal differences.(Alan Greenspan considers tougher margin requirements for investors)(Brief Article) Magazine article from: The Economist (US); 4/1/2000; 700+ words ; ...chairman, are tougher margin requirements for share investors. It is...the value of the shares. Margin debt has been soaring in the...harder for people to raise margin requirements? Mr Greenspan...studies that show that altering margin requirements makes little...rationale for ...
	DCE, ZCE to lift minimum margin requirements over National Day holiday. Newspaper article from: China Business News; 9/24/2008; 608 words ; ...ZCE to lift minimum margin requirements over National Day...lift minimum margin requirements for certain soft...the minimum margin requirement for corn futures...exchanges have lifted margin requirements to ensure...the minimum margin requirement for corn ...
	Margin requirements, price fluctuations, and market participation in metal futures. Magazine article from: Journal of Money, Credit & Banking; 8/1/1995; ; 700+ words ; ...economists in using margin requirements as a tool of controlling...recommendations of consistent margin requirements across...permanently higher margins in futures contracts...from the change in margin requirements to the target contract...influence of futures margins. ...
	COMEX raises margin requirements on September copper futures contract. (Commodity Exchange Inc.) PR Newswire; 9/9/1987; 700+ words ; ...COMEX RAISES MARGIN REQUIREMENT ON SEPTEMBER COPPER...contract. The original margin requirement for a...transactions. These original margin levels will apply...also raised clearing margins for the September...14, the original margin requirement for a COMEX ...
	CBOE acts to up margin requirements Newspaper article from: Chicago Sun-Times; 4/1/1988; ; 600 words ; ...approval, boosts margin requirements even higher. An effective...decided to begin basing margin requirements on price movements during...raised their minimum margin requirements to this new level and reaction...investor is required to place margin money in an account to ...
	The adequacy and consistency of margin requirements in the markets for stocks and derivative products. (Staff Study) Newspaper article from: Federal Reserve Bulletin; 9/1/1989; ; 700+ words ; ...and consistency of margin requirements in all segments of the equities...institutional description of margin arrangements with a detailed statistical analysis of margins and prices before and after...in price volatility allow margins on derivative products to...index, the pre-crash ...
	AMEX raises margin requirements on broad-market stock index options. PR Newswire; 10/23/1987; 700+ words ; ...Leibler. "By raising the margin level we are able to maintain...is not mandating that new requirements apply retroactively, but...investors from any unnecessary margin calls. Securities exchanges...authority to establish minimum margin requirements for options under...The federal regulation ...
	SEC Inches Toward Risk-Based Margin Requirements: The Securities and Exchange Commission is slowly moving toward portfolio margining, the risk-based model for determining margin requirements. Magazine article from: Investment Dealers' Digest; 11/6/2006; 700+ words ; ...stringent strategy-based margin requirements - investors are pregnant with...under the current rules, margin levels don't accurately...One allows for risk-based margin models to be used for broad...model, and its curtailed margin requirements, would make...1929 stock market crash. ...