This is not investment advice. The information provided is for educational and informational purposes only and does not constitute a recommendation to buy or sell any financial product.
Margin requirements for stock trading are the deposits the broker requires to open and maintain a leveraged position. The requirements are set by the broker, the regulator, and the trader's account type, and the broker's published schedule is the source of truth. Most traders can do the calculation in their head for a simple stock position, but the schedule can be complex for options, for small-cap stocks, and for traders who qualify for professional status.
The two main margin requirements
The first requirement is the initial margin, which is the deposit the trader must post to open the position. The initial margin is expressed as a percentage of the position value, and it is set by the regulator and the broker. For a major US stock with a 50% retail initial margin, a €10,000 position requires a €5,000 deposit.
The second requirement is the maintenance margin, which is the minimum equity the trader must maintain in the account as the position moves. The maintenance margin is usually lower than the initial margin, and it is the level at which a margin call fires. For a major US stock with a 50% initial margin and a 25% maintenance margin, the position is opened with a €5,000 deposit and the margin call fires when the trader's equity falls to 25% of the position value.
The difference between the initial margin and the maintenance margin is the trader's runway. A 50% initial margin with a 25% maintenance margin gives the trader 50% of runway before the margin call. A 50% initial margin with a 40% maintenance margin gives the trader only 20% of runway. The broker's published schedule tells the trader the runway, and the trader should plan for the tightest schedule the broker offers.
The variables that change the requirements
The initial margin rate is not a single number. It varies by instrument, by jurisdiction, by the trader's account type, and sometimes by the trader's experience level. Major US stocks with high liquidity and high market cap have the lowest rates. Minor US stocks, small-cap stocks, and stocks with high volatility have higher rates. ETFs are usually treated like the underlying basket. Options have a separate margin schedule, often calculated using a scenario-based model.
The jurisdiction matters because regulators in different regions set different caps. ESMA in the EU caps retail leverage at 1:5 for major stocks, which is a 20% initial margin. The FCA in the UK has similar caps. The Australian ASIC has tightened its rules to match. Offshore brokers can offer higher leverage, but the regulatory protection is thinner.
The account type matters because professional accounts and institutional accounts have different margin schedules than retail accounts. A trader who qualifies as a professional client under MiFID II can apply for higher leverage, but the trader has to meet the criteria, which include a minimum trade size, a minimum portfolio size, and relevant work experience.
The role of the position size
The position size is the trader's choice, and the margin requirement scales with the size. A €10,000 position with a 20% initial margin requires a €2,000 deposit. A €50,000 position with the same 20% initial margin requires a €10,000 deposit. The trader's account must have at least the deposit amount in cash before the trade is placed, and the broker will not allow the trade if the account does not have the cash.
The position size is the most common mistake in margin calculation. A trader who wants to take a €50,000 position with a 20% initial margin needs a €10,000 deposit, and the account must have at least that amount in cash. A trader who does not have the cash will be rejected by the broker, or will be forced to close another position to free the cash.
The role of eligible collateral
The margin requirement can be met with cash or with marginable securities. A trader who has €10,000 in cash and €20,000 in marginable securities can meet a €10,000 margin requirement in either way. The broker will usually prefer cash, but the broker will accept the securities if they are on the eligible list.
The list of marginable securities is published on the broker's website, and it changes over time. A trader who plans to use securities to meet a margin requirement should check the list before placing the trade. A security that is on the list today may be removed tomorrow, especially in a volatile market.
The maintenance margin and the margin call
The maintenance margin is the level at which a margin call fires. The call is a notification from the broker that the trader's equity has fallen below the maintenance margin, and the trader has a defined period (usually 24 to 72 hours) to deposit more cash, close part of the position, or both. If the trader does not respond, the broker closes the position at the worst available price and charges a fee.
The maintenance margin is usually expressed as a percentage of the position value, and it is published on the broker's website. A trader who holds a leveraged position should know the maintenance margin and the margin call procedure before the position is opened, not after. The trader who discovers the maintenance margin when the margin call fires is the trader who is forced to close at the worst moment.
How to calculate the margin requirement for a specific trade
The calculation is: position size × initial margin rate. For a €10,000 position in a major US stock with a 20% initial margin, the margin requirement is €2,000. The trader needs at least €2,000 in cash or eligible marginable securities in the account before the trade is placed. The broker's order ticket usually shows the margin requirement before the trade is confirmed, and the trader can check the number against the broker's published schedule.
For a more complex trade, the calculation is: position size × initial margin rate for each leg, summed. For an option spread, the initial margin is usually the cost of the spread plus a percentage of the underlying, and the broker's options margin calculator handles the details. For a futures position, the initial margin is set by the exchange, and the broker's product page shows the rate.
Related resources
Where to start
If you are calculating the margin requirement for a specific trade, the most useful figure is the broker's published initial margin rate for the instrument. Our broker comparison lists the leverage and the eligible instruments at each broker, which together tell you what the margin requirement looks like before you place the trade.