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re: Anyone see this story about CYNK?
Posted on 7/12/14 at 10:40 am to TheHiddenFlask
Posted on 7/12/14 at 10:40 am to TheHiddenFlask
If you short you'd be borrowing both the security and cash.
On shorts, you'd have both a Fed and House requirement. The house is usually more conservative than the Fed. Rates are solely determined by brokerage firm and based on size of account and credit risk. Individual securities have individual margin requirements based on a number of things, both Fed and house again.
So as an example my trading account indicates 100% margin equity currently. If I shorted a stock, a number of things change including, but not limited to, total market value, purchasing power of both marginable and non-marginable securities, available to withdraw, net cash/margin balance, margin equity and margin equity percentage.
On shorts, you'd have both a Fed and House requirement. The house is usually more conservative than the Fed. Rates are solely determined by brokerage firm and based on size of account and credit risk. Individual securities have individual margin requirements based on a number of things, both Fed and house again.
So as an example my trading account indicates 100% margin equity currently. If I shorted a stock, a number of things change including, but not limited to, total market value, purchasing power of both marginable and non-marginable securities, available to withdraw, net cash/margin balance, margin equity and margin equity percentage.
This post was edited on 7/12/14 at 10:49 am
1
Posted on 7/12/14 at 10:59 am to Iowa Golfer
CYNK was (is) 100% long/short. Rates determined by broker.
If you shorted 100 shares at 13.90, it would likely take a combined total of $13K in margin to complete this trade. On my account to buy 13K of margin would cost about $510 in cash as it would result in a house call of this amount. You'd pay interst on the cash excess and margin excess. They'd reserve cash and securities to ensure you could buy to cover at whatever ratio the house determines. In this case on my account, 10X the short due to the degree of risk in the trade.
Back to Scott Trade. They could have an issue allowing a guy like this to short a stock like this.
If you shorted 100 shares at 13.90, it would likely take a combined total of $13K in margin to complete this trade. On my account to buy 13K of margin would cost about $510 in cash as it would result in a house call of this amount. You'd pay interst on the cash excess and margin excess. They'd reserve cash and securities to ensure you could buy to cover at whatever ratio the house determines. In this case on my account, 10X the short due to the degree of risk in the trade.
Back to Scott Trade. They could have an issue allowing a guy like this to short a stock like this.
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