I have been working on this scenario for a good chunk of the day and can't figure it out: If you have a Reg T account, can you come up with a scenario where your excess equity (Account equity - Reg T positions) is substantially greater than your SMA account value? Interactive brokers says it can't happen. Other brokers' sites say that it can. My broker is cutting my margin on the basis that my SMA is negative while my excess equity balance is well over 10% of the account.
Btw - SMA means Special Memorandum Account. It's supposed to keep your margin levels tied to your account's high water mark rather than it's current (lower balance).