Advertisement
Anonymous
Or can i top it up only if stock gets assigned?
6
Discussion (6)
Learn how to style your text
Reply
Save
Most brokers will require a maintenance margin. This is the min amount of cash that you must have in the account that cannot be used for you to open the position. As the expiration date comes closer or the underlying stock drops, your maintenance margin will increase.
β
You usually have time (this varies between brokers) to add more cash if you do not have enough. You will get a warning for a margin call if you don't. There will be a time limit before a margin call is activated and lack of cash will risk the broker randomly closing other existing positions for you.
Reply
Save
Tan Choong Hwee
17 Nov 2021
Investor/Trader at Home
If you don't have the full amount of cash set aside, it would be naked, not cash-secured....
Read 2 other comments with a Seedly account
You will also enjoy exclusive benefits and get access to members only features.
Sign up or login with an email here
Write your thoughts
Related Articles
Related Posts
Related Posts
Advertisement
They will need the $ right at the start before you press the βbuyβ button
If your brokerage account is cash account, you need to ready the amount of $ inside brokerage
Otherwise if your account is margin and donβt have the amount of cash ready~ then the brokerage will see you as borrowing $ from them, and that you will need to beware of margin call, later wipe out your whole account to 0 π
It does not make sense to let you top up only when assigned , unless is margin account~ if not what if the person decided not to top up and delete the app