A customer opens a new margin account with no prior positions or balance and executes an o… — FINRA SIE (Securities Industry Essentials)

A customer opens a new margin account with no prior positions or balance and executes an order to purchase $100$ shares of ABC common stock at $\$28$ per share. Under Federal Reserve Regulation T and FINRA rules, what is the minimum dollar amount of margin deposit required from the customer for this transaction?

Cevap: 2000 USD

Cevap

The minimum required margin deposit is $2,000.

For a long stock purchase in a new margin account, Regulation T mandates a 50% deposit, which on a

2,800 purchase (

100 \text{ shares} \times \

28

) equals

1,400. However, FINRA rules specify an absolute minimum initial equity deposit of

2,000 for transactions between

2,000 and

4,000. Therefore, the investor must deposit $2,000.

Adım Adım Çözüm

Calculate the total value of the stock purchase

$2,800

Multiply 100 shares by the purchase price of

28 per share (

100 \times \

28 = \$2,800

Calculate the Federal Reserve Regulation T requirement

$1,400

Regulation T mandates an initial deposit of 50% of the purchase value (

50\% \times \$2,800 = \$1,400

Apply the FINRA minimum initial equity rule

$2,000

FINRA rules require a minimum initial equity deposit of

2,000 for opening long positions in a new margin account, unless the total purchase price is less than

2,000 (in which case 100% of the purchase price is required). Because

1,400 is less than

2,000, the FINRA minimum deposit requirement of $2,000 applies.

Anahtar Kavram

FINRA Initial Margin Minimum Equity Requirement

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