A margin call occurs when your account equity falls below the required maintenance margin level.
Why margin calls happen
Your account equity can fall below requirements when:
- Securities you bought on margin decline in value
- You withdraw cash or transfer securities out
- Maintenance requirements increase
What you need to do
When you receive a margin call, you must restore your account to the required level by:
- Depositing cash: Transfer funds into your account
- Depositing securities: Transfer marginable securities into your account
- Selling securities: Sell positions to reduce your margin balance
Timeframe
You typically must meet a margin call by the specified deadline (usually within a few business days). If you don't:
- Aries may sell securities in your account without prior notice
- You're responsible for any remaining debt
How to avoid margin calls
- Monitor your account equity regularly
- Keep additional cash or marginable securities in your account as a buffer
- Use stop orders to limit potential losses
- Don't use your full margin buying power