Concentrated Margin Positions Requirement Update

Starting from Friday, June 30, 2023, we will be increasing the margin maintenance requirements for accounts with concentrated positions. Under the new rules, the maintenance requirements will be increased for accounts with a debit balance equal to or greater than $100,000.

Specifically, requirements are raised according to the following table:

Percentage Threshold Concentration Requirement
25% 35%
35% 40%
50% 50%

Will this policy change affect positions held in cash accounts?

No, this change will only affect concentrated positions held in margin accounts with a debit balance equal to or greater than $100,000.

How do we calculate concentration?

Only equity (stock) positions are considered for concentration. ETF, option, mutual fund, and fixed income positions are not included.

What if the security already has an elevated maintenance requirement?

Concentrated positions will receive the greater of the current maintenance requirement or the concentration requirement. For example, If a security has a 45% maintenance override requirement and has a 40% concentration in the portfolio, the 45% requirement will be applied as opposed to the 40% concentration requirement. If the concentration in the portfolio is 55%, the 50% concentration requirement will be applied.

What if the account has a credit balance?

Concentration requirements will only be applied if an account has a debit balance of $100,000 or greater.

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