Margin Account Requirements
On this page
- Overview of Margin Requirements
- Interpretations of FINRA's Margin Rule
- Customer Margin Balance Reporting and Margin Statistics
- Portfolio Margin Disclosure Statement
- Contact OGC
Overview of Margin Requirements
The terms on which firms can extend credit for securities transactions are governed by federal regulation and by the rules of FINRA and the securities exchanges.
Some securities cannot be purchased on margin, which means they must be purchased in a cash account, and the customer must deposit 100 percent of the purchase price.
In general, under Federal Reserve Board Regulation T, firms can lend a customer up to 50 percent of the total purchase price of a margin security for new, or initial, purchases.
The rules of FINRA and the exchanges supplement the requirements of Regulation T by placing "maintenance" margin requirements on customer accounts.
Under these rules, as a general matter, the customer's equity in the account must not fall below 25 percent of the current market value of the securities in the account. Otherwise, the customer may be required to deposit more funds or securities to maintain equity at the 25 percent level (referred to as a margin call). Failure to do so may cause the firm to liquidate the securities in the customer's account in order to bring the account's equity back up to the required level.
The FINRA rules governing margin accounts are as follows:
- FINRA Rule 4210. Margin Requirements
- FINRA Rule 4220. Daily Record of Required Margin
- FINRA Rule 4230. Required Submissions for Requests for Extensions of Time Under Regulation T and SEA Rule 15c3-3
- FINRA Rule 4240. Margin Requirements for Credit Default Swaps
Interpretations of FINRA's Margin Requirements Rule
FINRA Rule 4210 (Margin Requirements) describes the margin requirements that determine the amount of collateral customers are expected to maintain in their margin accounts, including both strategy-based margin accounts and portfolio margin accounts. The rule explains the margin requirements for equity and fixed income securities, along with options, warrants and security futures.
The interpretations immediately follow the section of the rule to which they relate. The interpretations use a numbering convention of /##. For example: /01 of Rule 4210(a)(3).
Customer Margin Balance Reporting and Margin Statistics
- the total of all debit balances in securities margin accounts
- all free credit balances in all cash accounts
- all securities margin accounts on a settlement date basis as of the last business day of the month
After collecting this data via the Customer Margin Balance Forms, FINRA displays it in aggregate form on our Margin Statistics page.
2019 Filing Due Dates
|PERIOD ENDING||DUE DATE|
|January 31, 2019||February 8, 2019|
|February 28, 2019||March 8, 2019|
|March 29, 2019||April 8, 2019|
|April 30, 2019||May 8, 2019|
|May 31, 2019||June 10, 2019|
|June 28, 2019||July 9, 2019|
|July 31, 2019||August 8, 2019|
|August 30, 2019||September 10, 2019|
|September 30, 2019||October 8, 2019|
|October 31, 2019||November 8, 2019|
|November 29, 2019||December 9, 2019|
|December 31, 2019||January 9, 2020|
See Regulatory Notice 10-08 (Customer Margin Accounts) for more information.
Pursuant to FINRA Rule 2264 (Margin Disclosure Statement), no member shall open a margin account, as specified in Regulation T, for or on behalf of a non-institutional customer, unless, prior to or at the time of opening the account, the member has furnished to the customer, individually, in paper or electronic form, and in a separate document (or contained by itself on a separate page as part of another document), the specified margin disclosure statement. In addition, any member that permits non-institutional customers either to open accounts online or to engage in transactions in securities online must post such margin disclosure statement on the member's Web site in a clear and conspicuous manner.
Pursuant to FINRA Rule 4210(g), on or before the date of the initial transaction in a portfolio margin account, a member must provide customers with a special written disclosure statement describing the nature and risks of portfolio margining.
The disclosure statement must include an acknowledgement for all portfolio margin account owners to sign, attesting that they have read and understand the disclosure statement. Customers must also attest that they agree to the terms under which their portfolio margin account is provided.
Members must retain this signed acknowledgement and record the date of receipt.
FINRA's Office of General Counsel (OGC) staff provides broker-dealers, attorneys, registered representatives, investors and other interested parties with interpretative guidance relating to FINRA’s rules. Please see Interpreting the Rules for more information.
OGC staff contacts:
1735 K Street, NW
Washington, DC 20006
- Margin Requirements for Exchange-Traded Notes
- FINRA Extends Effective Date of Margin Requirements for Covered Agency Transactions
- FINRA Extends Effective Date of Margin Requirements for Covered Agency Transactions
- 2018 Holiday Trade Date, Settlement Date and Margin Extensions Schedule
- FINRA Makes Available Frequently Asked Questions and Guidance and Extends Effective Date of Margin Requirements for Covered Agency Transactions: New Effective Date: June 25, 2018
- (Margin Requirements) to Establish Margin Requirements for Covered Agency Transactions
- SEC Approves Consolidated FINRA Rules 4314 (Securities Loans and Borrowings), 4330 (Customer Protection — Permissible Use of Customers' Securities) and 4340 (Callable Securities)
- FINRA Requests Comment on Proposed Amendments to FINRA Rule 4210 for Transactions in the TBA Market
- SEC Approves Amendments to FINRA Rule 4210 (Margin Requirements)
- FINRA Revises the Treatment of Non-Margin Eligible Equity Securities and Delays the Effective Date
- Treatment of Non-Margin Eligible Equity Securities
- Guidance on Low-Priced Equity Securities in Customer Margin and Firm Proprietary Accounts
- Margin Requirements for Exempted Securities Mutual Funds and Exempted Securities ETFs
- SEC Approval and Effective Date for New Consolidated FINRA Rules Regarding Margin Requirements, Daily Record of Required Margin, and Extension of Time Requests
- FINRA Issues Guidance on Master and Sub-Account Arrangements
- FINRA Requests Comments on Proposed Consolidated FINRA Rules Governing Securities Loans and Borrowings, Permissible Use of Customers' Securities and Callable Securities
- Increased Margin Requirements for Leveraged Exchange-Traded Funds and Associated Uncovered Options
- FINRA Grants Additional,Temporary Relief from the Net Capital, Reserve Formula, Non-purpose Loan, & Maintenance Margin Requirements Applicable to Credit Extended on Auction Rate Securities to Broker-Dealers That Agree to Buy Back Auction Rate Securities
- FINRA Announces Temporary Margin Maintenance, Net Capital and Reserve Formula Requirements Related to Money Market Mutual Funds Effective Date: October 21, 2008
- FINRA Temporarily Increases Margin Maintenance Requirements on Auction Rate Securities Backed by Fixed Income Products
- Portfolio Margin Risk Disclosure Statement and Written Acknowledgement to be Furnished to Customers Using a Portfolio Margin Account
- NASD Adopts Amendments Regarding the Posting of Margin Disclosure and Day-Trading Risk Disclosure Statements on Web Sites
- FAQView frequently asked questions and guidance about covered agency transactions under FINRA rule 4210 and frequently asked questions regarding SEA Rule 15c3-1 and Rule 15c3-3.September 18, 2017
- FAQPortfolio Margin FAQ
- GuidanceFINRA Rule 4210 (Margin Requirements) describes the requirements for the extension of credit by firms that offer margin accounts to customers, in accordance with Regulation T of the Board of Governors of the Federal Reserve System.
- March 18, 2009
- April 10, 2007
- NASD Fines Ameritrade, Datek and iClearing $10 Million For Improperly Extending Credit and Allowing Trades That Avoided NASD Day Trading Margin RulesMarch 11, 2004
- September 15, 2003
- NASD Regulation Fines and Censures Worldco, LLC and Former Principal for Day Trading Margin ViolationsJanuary 09, 2002
- July 27, 2000
- April 27, 2000
- December 10, 1999
- April 20, 1999
- April 08, 1999
- Investor EducationVolatility is back, and market swings can sometimes bring an uncomfortable surprise to investors—a margin call.
- Investor AlertFINRA is re-issuing this alert because we are concerned that many investors may underestimate the risks of trading on margin and misunderstand the operation of, and reason for, margin calls.
- Investor EducationIf you’re going to day trade—and it’s very risky to do so—you must abide by the rules, particularly those that deal with margin. If a brokerage firm designates you as a “pattern day trader,” then FINRA margin rules require that broker-dealer to impose special margin requirements on your day-trading account.
- Investor EducationWe are issuing this investor guidance to provide some basic facts to investors about the mechanics of margin accounts.
- Investor EducationPursuant to FINRA Rule 4521, FINRA member firms carrying margin accounts for customers are required to submit the following customer information: the total of all debit balances in securities margin accounts; and, the total of all free credit balances in all cash accounts and all securities margin accounts.
- Investor EducationWe are issuing this investor guidance to provide some basic facts to investors about the practice of purchasing securities on margin, and to alert investors to the risks involved with trading securities in a margin account.
- Investor EducationWe are issuing this investor guidance to provide some basic information about day-trading margin requirements and to respond to a number of frequently asked questions that we have received. We also encourage you to read our Notice to Members and Federal Register notice about the rules.