When can you think, a margin call

Q friends tell me that some brokers are faster issuing margin calls than others. Are not all investment firms to deal with margin accounts in the same way?

A broker can not investors that the margin rules allow Trub, but they have chosen to give less. The Federal Reserve Board limit funding for the new storage facility purchases is 50 percent of the price. To acquire 100 shares to a sale of stocks to 60, for example, you must be at least $ 3000 and can not borrow more than $ 3000 by the broker.

Any other issue of a deposit on the share price shaved off $ 100 $ 3000 equity. If the price falls 20 points on 40, we say, you have the original-$ 3000 a capital of 100 shares will be reduced by $ 1000 ($ 3000 less $ 2000). On one hand, 40, 100 shares of your Holding will pay $ 4000 and $ 1000 Shareholders’ equity is 25 percent, 25 percent margin, brokers’ slang.

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