What is a Margin Call?
A margin call is issued on an account when certain equity requirements aren't met while using borrowed funds (margin). When a margin call is issued, you will receive a notification via the Secure Message Center in the affected account. There are several types of margin calls and each one requires a specific action.
How is it reflected in my account?
When your account is in a margin call you will be notified via the *Secure Message Center. There will also be a yellow banner at the top of your TD Ameritrade homepage notifying you of the call and the deficiency amount.
Finally, your account’s Funds Available for Trading (Option BP on Thinkorswim) will be reflected as a negative number.
Types of Margin Calls
How do I meet my margin call?
- Deposit the original call amount
- Liquidate securities so that your account would be positive based on the closing prices of the normal market session
- Deposit fully paid-for marginable securities*
- Or any combination of the aforementioned ways
I have multiple margin calls in my account, can I just liquidate enough to meet the first margin call?
No, TD Ameritrade will only consider this margin call met if you deposit the full amount of the original call. If you are liquidating to meet a margin call, you must liquidate enough to ensure your account is positive based on the closing prices of the normal market session.
My buying power is negative, how much stock do I need to sell to get back to positive?
Generally, you can take your Funds Available for Trading and divide by the margin requirement of the security you plan to liquidate to determine the total notional value which must be liquidated to get back to positive. Liquidating positons can be complex, if you need additional assistance call a margin Specialist at 877-877-0272 ext 1.
The following account is deficient by $2,000 and is looking to get back to positive by selling a stock in the account which has a 40% margin requirement.
In this case, the client would need to liquidate $5000 worth of a stock with a 40% margin requirement in order to meet their $2000 deficiency.
The following account is in a Regulation-T call in the amount of $2,000 and is looking to get back to positive by selling a stock in the account.
-2000/50% = $4000
In this case, the client would need to liquidate $4000 worth of stock in order to meet the $2000 Reg-T call.
*The deposit of marginable securities does not give dollar-for-dollar relief. In order to determine how much relief marginable securities offer, please contact a margin representative at 877-877-0272, ext 1. (added punctuation)
Margin trading increases risk of loss and includes the possibility of a forced sale if account equity drops below required levels. Margin is not available in all account types. Margin trading privileges subject to TD Ameritrade review and approval. Carefully review the Margin Handbook and Margin Disclosure Document for more details. Please see our website or contact TD Ameritrade at 800-669-3900 for copies.