Marginal
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General Margin Requirements
Here is a list of the different types of
securities you can usually trade on margin, along with other essential
margin information. Please note that these numbers can change without
prior notification.
Equity Securities
| Security Value |
Loan Value |
| Equities $2.49 and
less |
no loan value |
| Equities $2.50 and
over |
50% of market value |
| Option eligible* securities
over $5.00 |
70% of market value |
| Mutual Funds |
50% of market value |
| *issues
which have met the criteria for the issuing of exchange traded
options |
Fixed
Income Securities
| Issued/Guaranteed by: |
Term to Maturity |
Loan Value |
| Governments of Canada, UK, USA |
10 years and less |
95% |
| |
Over 10 years |
95% |
| Parastatal |
3 years and less |
95% |
| |
Over 3 years |
90% |
| Municipalities |
1 year and less |
95% |
| |
Over 1 year |
90% |
| Commercial Paper*, Banker's Acceptances*,
Corporate Bonds* |
3 years and less |
90% |
| |
Over 3 years |
85% |
| |
Convertible |
70%* |
| |
Selling at 50% of par or lower |
no loan value |
| Negotiable GICs |
n/a |
50% |
| All Fixed Income Products in Default |
n/a |
no loan value |
| Income Bonds - paying interest as
stated |
10 years and less |
85% |
| |
over years |
50% |
| *no rating on Bonds
below B rating or if trading at below 50% par |
Eligible
Markets
Securities trading in the following markets will be eligible for margin:
| Eligible |
Ineligible |
| New York, Toronto, Amex, Montreal,
some NASDAQ* issues |
Vancouver, Alberta, Canadian OTC |
| *issues which appear
on the Federal Reserve Board's approved list |
Recommended further reading:
Buying
Power and Excess Margin
The advantages and disadvantages
of a Margin Account
Debit Balance and Margin
Interest Rates
Margin Account Approval
Margin account - diversified
portfolio
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