Hello, I wonder how to calculate margin needed in this example: - Buy 100 shares of AAPL for $100.0 - Buy 1 PUT for $4.00 at strike 100 I beleive that if we only buy the shares, we would need this margin? 100 * $100 = $10000 I also then wonder what margin that would be required in total if we bought the shares and the PUT How is the way to calculate this manually? Thank you
I assume you mean Reg-t. http://www.cboe.com/tradtool/mcalc/ Long Put & Long Underlying Stock Initial margin requirement: put(s) must be paid for in full 50% margin requirement on long stock (in a margin account) after position is established, ongoing maintenance margin requirement applies, and an increase (or decrease) in the margin required is possible Position Long 1 Jan 100 put(s) at $4.00 Long 100 shares underlying stock at $100.00 Initial Margin Margin requirement for put(s): $400.00 Margin requirement on stock purchase: $5,000.00 Margin call (SMA debit): $5,400.00
Thanks, I wonder something. When I look at my trading account, I can see a SMA which is 10 times greater than actual money I have in the account. For example, Cash: $1000 SMA: $10000 Does this mean that I can purchase shares for $10000 on that margin? I must confirm this. Is it not possible to buy PUTS on margin as you do with stocks?
You are subject to regular Reg-T margin requirements. I suspect what you are thinking about is Portfolio margin. PM will consider the hedge/maxloss into consideration when calculating margin. The put option in regular Reg-T will not lower you margin requirements.