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margin requirement
margin requirement definition - finance
The
minimum amount of money that a client must have on deposit, either in cash or
approved securities, in a margin account at a brokerage office. Margin
requirements for stock trading are governed by the Federal Reserve through
Regulation T. Generally, investors are required to have a minimum margin of 50
percent of the purchase price of securities or 50 percent of the proceeds of
short sales. Also called initial margin.
Webster's New World Finance and Investment Dictionary Copyright © 2003 by Wiley Publishing, Inc., Indianapolis, Indiana.
Used by arrangement with John Wiley & Sons, Inc.
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