Stock Margin Requirements
Stocks Margin Overview
Australia Stocks Margin Requirements
For residents of Australia trading stocks:
- Risk-based margin
The complete margin requirement details are listed in the sections below.
The information in this document forms part of the Interactive Brokers Australia Margin Lending Facility Product Disclosure Statement.
Risk Margin Overview
What is risk based margining?
A risk based margin system evaluates your portfolio to set your margin requirements. The risk valuations of your positions are created using simulated market movements that anticipate possible outcomes. As a result, a more accurate margin model is created, allowing the investor to increase their leverage.
How are correlated risks offset?
Within a group of positions with the same underlying, 100% of the gain at any one valuation point is allowed to offset another positions loss at the same valuation point.
Example: An account holds a long stock position in stock ABC and a long put option contract in ABC. If a theoretical worst case scenario causes the underlying asset to drop 15%, then the loss that on the long stock position would be offset by the gain on the long put position.
What are my eligibility requirements?
Eligibility requirements vary according to the investor's personal information, region, and exchange.
What positions are eligible?
All positions in margin equity securities (including foreign equity securities and options on foreign equity securities, listed options on an equity security or index of equity securities, security futures products, unlisted derivatives on an equity security or index of equity securities, warrants on an equity security or index of equity securities, broad-based index futures, and options on broad-based index futures.
Additional Australia Margin Requirements
For Residents of Australia:
Use the following links to view other margin requirements:
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Disclosures
- For Leveraged ETFs, Minimum(50% * Leverage Factor, 100%)
- Interactive Brokers Australia Pty Ltd margin accounts must have a minimum of AUD 2,000 to trade on margin.
- Margin requirements quoted in US dollars may also be satisfied with a Non-US Dollar equivalent.
- We have additional algorithms which increase the nominal margin for positions that represent a > 1% holding of an individual company's shares outstanding, with full margin required for concentrations of > = 5% of a company's shares outstanding. Investors should be prepared to meet the increased margin, where holdings are above 1% threshold.
- Interactive Brokers Australia currently offers margin lending to all clients EXCEPT Self- managed Superannuation Fund account holders ("SMSF"). Click here for more information. For clients of Interactive Brokers Australia who are classified as retail, margin loans will be capped at AUD 50,000 (subject to change in IBKR Australia’s sole discretion). Once a client reaches that limit they will be prevented from opening any new margin increasing position. However, how much a client can borrow depends on a number of factors, including: the value of the money or assets contributed by the client as security; which financial products the client chooses to invest in, as we lend different amounts for different products under our risk-based model; and the maintenance margin requirement for the client’s portfolio. Once a client reaches their borrowing limit they will be prevented from opening any new margin increasing position. Closing or margin-reducing trades will be allowed. Refer to this link for information regarding margin accounts offered by IBKR Australia.