Series 7 practice questioneasyMargin Accounts — Maintenance Margin
The minimum maintenance margin requirement for long positions, as set by FINRA, is:
- A25% of the current market value✓ Correct answer
- B30% of the current market value
- C50% of the current market value
- D75% of the current market value
Explanation
Why A — 25% of the current market value
FINRA (and NYSE) require a minimum maintenance margin of 25% of the current market value for long positions. If equity falls below this level, the broker issues a maintenance margin call requiring the investor to deposit additional cash or securities. Many brokerage firms set their own "house" maintenance requirements higher than the 25% minimum, often at 30-35%.
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