Last week, I bought 4 shares of emicro gold futures (https://www.cmegroup.com/trading/metals/precious/e-micro-gold_contract_specifications.html) worth about 70k. I got a margin call for owning those gold despite having 400k worth of equities and having no other margin debt in my account.

Why did I get this margin call? I had 0 cash, but 400k worth of stocks. Is it because my equities don't count towards the maintenance margin of the futures contract? As far as I understood the maintenance margin is 1k per future contract in the link above, so I guess I would need 4k of cash (not stocks) in my account at all times to hold those 4 gold futures contracts?

I think the mistake I made was that despite having lots of stocks, I had no cash in my account. Can someone confirm this is what triggered my margin call?

  • Amazing stuff - what broker ? – Fattie Feb 2 at 2:29
  • The answers are yes, yes, and yes. Would you expect your broker to sell equities to cover your losses? Which ones? – D Stanley Feb 2 at 2:36
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    @DStanley Since I lost <1000$ and had 400k worth of equities and a massive cushion on my equities maintenance margin, I certainly wasn't expecting to get liquidated on my position, although I get your point. Seems somewhat absurd to have a totally different margin requirement for commodities than equities, it's not like i was going to go broke on 1/400th of my account in losses. – user3586940 Feb 2 at 3:32
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    @BobBaerker Just want to say I really appreciate your answers on this website btw. – user3586940 Feb 2 at 3:34
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    @user3586940 - Thanks, I appreciate you're saying that. It may sound hokey or corny but part of it is a bit of Pay It Forward. 30+ years ago I was on the stock and option bulletin boards on Prodigy and there were many experienced people who greatly helped me with my learning curve which needed a lot of work at that time :->). – Bob Baerker Feb 2 at 3:47

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