Match each margin account scenario or regulatory provision on the left with its correspond… — FINRA SIE (Securities Industry Essentials)

Match each margin account scenario or regulatory provision on the left with its corresponding statutory requirement or threshold on the right.

Initial margin required for a long purchase of $1,600 of marginable stock in a newly opened margin account$1,600 deposit (100% of the purchase value)
Initial margin required for a short sale of $1,500 of marginable stock in a newly opened margin account$2,000 deposit (FINRA minimum initial equity floor)
Standard Regulation T payment deadline for a margin call following the trade date ( $T$ ) $T + 4$ business days ( $S + 2$ business days)
Maximum value of customer securities a broker-dealer may rehypothecate to a bank to secure a margin loan140% of the customer's net debit balance

The correct pairings match each margin account rule to its precise regulatory limit: a

1,600 long purchase matches a

1,600 deposit (100% of purchase value); a

1,500 short sale matches a

2,000 deposit (FINRA minimum initial equity floor); the Regulation T margin call payment deadline matches

T + 4

business days (

S + 2

business days); and the broker-dealer rehypothecation cap matches 140% of the customer's net debit balance.

Each scenario correctly aligns with established regulatory standards under Regulation T and FINRA Rule 4210. Long purchases under

2,000 require 100% of the transaction value; short sales under

2,000 strictly require the

2,000 FINRA minimum equity deposit; Regulation T allows margin payment within

T + 4$ business days; and rehypothecation to bank lenders is capped at 140% of the customer's debit balance.

Determine the long purchase initial margin requirement for small transactions

For a long purchase of

1,600, 50% Regulation T would equal

800. However, FINRA Rule 4210 dictates that for purchases under

2,000, the customer must deposit 100% of the purchase amount (

1,600).

FINRA initial equity rules enforce a $2,000 minimum or 100% of purchase price, whichever is lower, for long positions.

Determine the short sale initial margin requirement for small transactions

For a short sale of

1,500, FINRA Rule 4210 requires an initial equity deposit of

2,000.

Unlike long purchases, short accounts carry unlimited loss potential; therefore, FINRA does not scale down the

2,000 minimum requirement for short sales under

2,000.

Identify the Regulation T payment timeline window

Regular-way settlement occurs at

T + 2

business days. Regulation T grants an additional two business days (

S + 2

), making the payment deadline

T + 4

business days.

The Federal Reserve Board sets margin payment timelines based on settlement plus two business days.

Identify the broker-dealer rehypothecation collateral limit

The maximum amount of customer securities pledged to a bank as collateral is capped at 140% of the debit balance.

Federal rules limit rehypothecation to prevent broker-dealers from over-pledging customer margin assets.

Regulation T and FINRA Rule 4210 initial margin calculations, settlement timelines, and rehypothecation limits.

Question