What’s margin maintenance?
Margin maintenance is the minimum portfolio value (excluding any crypto positions) that you need to prevent a margin call.
You always need to keep your portfolio above $2,000 and your margin maintenance requirement to avoid these types of margin calls.
To view your margin maintenance:
To view your margin details in real time, click here.
Your margin maintenance is based on a model that considers certain factors, such as volatility and market liquidity. For example, stocks that are known to be more volatile typically have higher maintenance requirements to ensure you have enough portfolio value to cover the position if it quickly decreases in value.
If your portfolio value (excluding any crypto positions) drops lower than your margin maintenance requirement, you may get a margin call. You’ll need to bring your portfolio value back up to your minimum maintenance requirement, or you risk forced liquidation of your positions to bring your portfolio value (excluding any crypto positions) back above your margin maintenance requirement. Review How do I avoid a margin call for more details.
Robinhood can adjust margin maintenance requirements at any time and sell out whichever positions are deemed fit to satisfy your margin call, without notifying you first or gaining your authorization.
Crypto positions can't be traded on margin. They’re not accounted for in your portfolio value because they’re not securities. They’re custodied with our affiliate, Robinhood Crypto, LLC.
Your maintenance requirement is based on the market value and maintenance ratio of each position in your portfolio.
If you only own 1 stock, the calculation is easy. For example, let's say you have:
$10,000 of XYZ stock with a maintenance ratio of 40%.
Your maintenance requirement would be calculated by multiplying the market value of your XYZ position ($10,000) and the maintenance ratio (40%), resulting in a requirement of $4,000 of equity. Any additional equity could then be available as buying power in your margin account.
As the market value changes for a position, your requirement will change as well.
With multiple positions, calculating your overall maintenance requires additional steps. Let’s say you have:
Your maintenance requirement is calculated by adding the requirement for each position:
($10,000 * 0.4) + ($20,000 * 1) + ($10,000 * 0.25) = $26,500 (total maintenance requirement)
For this example, to meet your maintenance requirement and avoid a margin maintenance call, you’d need $26,500 of equity.
Also, because the ABC position has a maintenance ratio of 100%, it is considered non-marginable and requires 100% in equity to support it. Similarly, long options also have a 100% maintenance requirement.
All investments involve risk including loss of principal. No investments are FDIC insured. All examples are hypothetical and don’t reflect actual or anticipated results. This content is provided for informational purposes only, doesn't constitute investment advice and isn't a recommendation for any security, account type or feature, or trading strategy. Past performance doesn’t guarantee future results.
Margin investing involves interest charges and risks, including the potential to lose more than deposited or the need to deposit additional collateral in a falling market. Before using margin, customers must determine whether this type of trading strategy is right for them given their specific investment objectives, experience, risk tolerance, and financial situation.
Regardless of the underlying value of the securities you purchased, you must repay your margin debt. Robinhood Financial can change its maintenance margin requirements at any time without prior notice. If your portfolio value falls below the minimum maintenance requirements (varies according to the security), you’ll have to deposit additional cash or acceptable collateral. If you fail to meet your minimums, Robinhood Financial may be forced to sell some or all of your securities, with or without your prior approval.
For more information, see FINRA’s Investor Alert and Robinhood Financial’s Customer Relationship Summary, Margin Disclosure Statement, and Margin Account Agreement. These disclosures contain important information on Robinhood Financial’s products and services, conflicts of interests, lending policies, interest charges, and the risks associated with margin investing enabled accounts.
Crypto trading and custodial services are offered through an account with Robinhood Crypto. Robinhood Crypto isn’t a member of SIPC or FINRA. Robinhood Crypto and Robinhood Financial are separate but affiliated entities. Crypto positions aren't securities and aren't FDIC insured or SIPC protected. For more information, review the Robinhood Crypto Risk Disclosure.