if your account is just cash, does portfolio margin give you more than the standard 4x buying power? for example in Reg-T, a naked SPX uses 15% margin, out of the 4x buying power. a stock typically uses 30% margin out of the 4x buying power. what would those numbers be in a PM account -- specifically for day-trading buying power. on tastytrade webpage it says PM is 6.7x buying power vs 2x of regular margin typically - but that is for overnight - I am more interested in the day trading differential 4:1 vs what? Standard margin (Reg-T) vs. Portfolio Margin (PM) 2:1 LEVERAGE VS. ≈ 6.7:1 LEVERAGE
This is going to differ from broker to broker, as no one uses straight OCC TIMS margin for naked options for their house requirement. And, options do not provide leverage per se. The OCC requirement for a naked SPX options is the loss down from a 8% move or the loss up from a 6% move when you aggregate all your SPX positions. Your BP at Lightspeed would be based on 6.67X your overnight excess, which is a higher value than 4X your overnight excess in REG-T.
Thanks for your reply. I guess I could get an additional 66% margin (2.67/4). I guess I would need to make a new account. I had a bad experience with PM about 10 years ago, when IBKR started charging me $25/day for "exposure risk". I stopped trading for a while, and then now I am just using Reg-T. I also found an ok video about this from AMTD on youtube:
Are there any situations (for example a concentrated stock position) where you would have less buying power in a pm auction vs reg t
Our concentration risk limits apply the same for any margin account. But with us, that is risk not margin. Our risk team would ask you to reduce or add funds. There are situations where with PM overnight position have a higher requirement than Reg-T as we add 20% to the OCC for accounts under $5mm. There are very few situations where it applies to day trading.