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What is a settlement instruction? Standing settlement instructions are instructions that have been agreed in advance, and that are to be used every time a trade is made. For recurring transfer of funds or securities, you may enter standing settlement instructions that can be used each time a transfer request is made.

Initial Margin vs. However, the initial margin requirement is the amount of cash or collateral required to actually purchase securities; the Federal Reserve's Regulation T sets that sum at a minimum of at least 50% of the purchase. In other words, you can't borrow more than half the price of the investment.

ing to Regulation T of the Federal Reserve Board, the Initial Margin requirement for stocks is 50%, and the Maintenance Margin Requirement is 25%, while higher requirements for both might apply for certain securities.

Regulation T states that the investor can borrow no more than 50% of the purchase price, or $500, from the broker, while the remaining balance must be paid in cash.

Rule 15c6–2 was adopted as part of the final rules to shorten the standard settlement cycle for securities transactions from two business days after the transaction date to one business day following the transaction date. The compliance date for adopted Rule 15c6–2 is May 28, 2024.

Key Takeaways. Maintenance margin is the minimum amount of equity that an investor must maintain in the margin account after the purchase has been made. Maintenance margin is currently set at 25% of the total value of the securities in a margin account as per FINRA requirements.

For example, the fixed percentage margin requirement for a non-concentrated uncovered option is the greater of the following calculations: 20% of the underlying price minus the out-of-the-money amount plus the option premium multiplied by the number of contracts and contract multiplier (generally 100).

Overview of Margin Requirements In general, under Federal Reserve Board Regulation T (Reg T), brokers can lend a customer up to 50 percent of the total purchase price of a margin equity security for new purchases.