Friday, July 15, 2011

Is it safer to use only 50% of my avaible margin purchasing power? compared to 100?

I would like to purchase some stocks on margin. But i need to know more about the margin call. I want to know if I just use 50% of my total margin purchasing power would my margin call be lower or the same as if i use 100% of my total. I use scottrade and i belive they have a 35% margin maintenence requirment. Lets say i have $20,000.00 in cash, and buy $30,000.00 of stocks on margin. I bought 1500 shares at $20 each. At what price would the stock need to decline for me to be hit with a margin call. And same question but instead if i bought $40,000.00 worth of stocks.

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