Standard margin (Reg-T) vs. Portfolio Margin (PM)
2:1 leverage vs. ≈5:1 leverage
The buying requirement for standard margin accounts governed by FINRA's Regulation-T that allows 2:1 leverage, namely 50% initial margin and 25% maintenance. On the other hand, Portfolio Margin accounts base on the Theoretical Intermarket Margining System (TIMS) margin methodology, which is a risk-based approach, thus allowing ≈5:1 leverage. Unlike a standard margin account that is subject to a fixed initial and maintenance requirement percentage, PM accounts take a risk-based approach. To learn more about PM, as well as how to apply for PM, please click here.