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In TD Ameritrade, margin accounts show a maintenance requirement for the account even if no loan was used to purchase any of the securities. Why is this? How could a margin call ever happen if no margin was used?

Also, even with cash in the account that would cover a stock purchase, a given order registers a margin balance before the trade closes. Does the broker use margin as a way to quickly fulfill an order and then settle with cash at a later time? Does this trigger the need to calculate a maintenance requirement for the entire account?

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TD is telling you what the margin requirement is for your account. It's not reflecting existing use of margin. So if you had $10k of fully paid securities, it would indicate that the margin requirement is $5k.

As for the a account, there is no margin involved with security transactions. Settlement is T+2 which means that the respective brokers have two days to settle the trade with cash going one way and the security going the other.

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  • Let's assume the price of the securities drops 60% and you're left with $4k. Would you need to post margin as you'd be short $1k of the maintenance margin requirement?
    – 0xFEE1DEAD
    Jan 12 at 19:40
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    He isn't on margin so he cannot be "short $1k of the maintenance margin requirement" is share price drops 60%. It's telling him that the margin requirement of his $10k position is $5k which leaves another $5k available for margin purposes (assuming that the broker is not higher than 50% Reg T). At an account value of $4k it would say that the margin requirement is $2k. Jan 12 at 19:50

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