Section 6, Basics Of A Margin Account Long

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5 Terms

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Equity Formula
Current Market Value – Debit Balance = Equity
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Excess Equity
Equity above Reg T requirements; can be used to withdraw cash or creates buying power = 2x excess equity.
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SMA
Line of credit available in a margin account created by excess equity.
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Restricted Account
Occurs when equity falls below 50% requirement; 50% of sales proceeds retained, 50% released.
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Maintenance Requirements
NYSE minimum = 25%, House minimum = 30%.#