What is maintenance excess?

Explaining Maintenance Excess

Displays how close you are to a margin call

Maintenance excess is a realtime number that lets you know the amount of excess cash and equity outside of your maintenance requirement. In short, it can tell you how close you are to a required maintenance margin call. When maintenance excess is positive, then your account is in good standing. However, if your maintenance excess is negative and your account closes negative at the end of the trading day, then you may receive a maintenance margin call. You can locate the value of your stock position(s) by referring to the position net liq column in your Positions tab. Additionally, your maintenance requirements list in your Capital Requirement Report.

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How to calculate Maintenance Excess

Maintenance Excess = Cash + Stock Value – Maintenance Requirements

For example, if you deposit $10,000 into a margin account your maintenance excess would look like this.

Maintenance Excess = 10,000 (cash) + 0 (stock) – 0 (maintenance) = 10,000

After depositing $10,000, you can buy up to $20,000 worth of stock with the typical 50%/25% (initial/maintenance) requirement rates. Let’s say you buy $18,000 worth of XYZ. You would need to spend all $10,000 in addition to borrowing $8,000 to make this trade. Your maintenance margin requirements would be $4,500 (25%).

Maintenance Excess = -8,000 (cash) + 18,000 (stock)4,500 (maintenance) = 5,500

If the stock were to drop in value, your maintenance excess would start to decrease. Let’s say the stock value drops to $10,000. The new maintenance requirement would be $2,500 (25%). This would put the account into a $500 maintenance margin call.

Maintenance Excess = -8,000 (cash) + 10,000 (stock) 2,500 (maintenance) = -500