Product-Specific Margin Requirements
Chapters in this video
- 0:00 Exempt securities and the VIP good-faith rule
- 1:22 Active recall: does exempt mean zero margin
- 1:53 Treasury maturity ladder and duration risk
- 3:03 Corporate bonds: standard 50% Reg T
- 4:03 Mutual funds and the 30-day stop sign
- 5:11 Exempt versus non-marginable side-by-side trap
- 5:41 Rapid-fire exam recap
What this video covers
- Why exempt securities (U.S. Treasuries, agency securities, municipal bonds) skip the 50% Reg T rule and use good-faith margin set by the broker-dealer instead
- How Treasury margin requirements rise with time to maturity, and why duration risk (price sensitivity to interest rate changes) drives that sliding scale
- The exact good-faith percentages to expect from short-term to ultra-long-term Treasuries, and why longer maturities swing like a longer pole in the wind
- Why corporate bonds are nonexempt and treated exactly like stocks: the greater of 50% of market value or $2,000 initial margin
- The 30-day mutual fund rule: fully paid at purchase, non-marginable for 30 days, then normal Reg T collateral treatment
- How redeeming mutual fund shares within 30 days on unsettled credit triggers a free-riding violation and account freeze
- The critical exam distinction between exempt (lower good-faith margin, not zero) and non-marginable (100% cash, zero margin allowed)
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