The price at which your broker issues a margin call on a long or short stock position, how far the stock can move before it happens, and the cash you would need to meet it.
The stock can fall 33.3% from here before a call.
No margin call at this price.
Buying on margin, you pay the initial margin and borrow the rest. Your equity is the position’s value less the loan, and the broker calls when equity falls below the maintenance share of the position’s value.
Long: call price = entry price × (1 − initial margin) ÷ (1 − maintenance margin)
Short: call price = entry price × (1 + initial margin) ÷ (1 + maintenance margin)
Buy 100 shares at $100 with 50% initial margin and you borrow $5,000. With 25% maintenance the call comes at $66.67, a fall of a third. Short the same 100 shares with 30% maintenance and the call comes at $115.38.
A demand from your broker to add cash or securities, or reduce the position, because the equity in a margin account has fallen below the maintenance requirement. If you do not meet it, the broker can sell your holdings without asking.
Initial margin is the share of a purchase you must pay yourself when you open it; Regulation T sets it at 50% for most stocks. Maintenance margin is the share of the position’s current value your equity must stay above afterwards; FINRA’s minimum is 25% for long positions and 30% for most short positions, and brokers often set more.
A short loses money as the price rises, so the value of the shares you owe grows while your credit stays the same. When equity falls below the maintenance share of the shares’ current value, the broker calls, just as for a long position.
Enough to bring equity back up to the maintenance requirement at the current price, which is what this calculator shows. Some brokers ask for more, up to the initial margin, so check their terms.
Margin Call is a free stock market game in your browser. Borrow, sell short, and watch the maintenance requirement close in when the market turns, without risking real money.
Play freeFor education, not financial advice. Your broker’s rules decide when a call comes; check their margin requirements.