I'm testing out a new strategy and I want to make sure that I set my margin usage correctly to prevent the potential for a margin call. If you could check my math I would appreciate it.
Would the margin call happen between a 500% and 600% drawdown when the equity% reaches less than 30%? Assuming a 200% margin requirement for this security.
| Account Value | Initial Value | Initial Margin Used | Drawdown | Final Value | Loss | Final Value | Margin Requirement | Equity % |
|---|---|---|---|---|---|---|---|---|
| $ 100,000.00 | $ 10,000.00 | 10% | 100% | $ 20,000.00 | $ (10,000.00) | $ 90,000.00 | $ 40,000.00 | 225.00% |
| $ 100,000.00 | $ 10,000.00 | 10% | 200% | $ 30,000.00 | $ (20,000.00) | $ 80,000.00 | $ 60,000.00 | 133.33% |
| $ 100,000.00 | $ 10,000.00 | 10% | 300% | $ 40,000.00 | $ (30,000.00) | $ 70,000.00 | $ 80,000.00 | 87.50% |
| $ 100,000.00 | $ 10,000.00 | 10% | 400% | $ 50,000.00 | $ (40,000.00) | $ 60,000.00 | $ 100,000.00 | 60.00% |
| $ 100,000.00 | $ 10,000.00 | 10% | 500% | $ 60,000.00 | $ (50,000.00) | $ 50,000.00 | $ 120,000.00 | 41.67% |
| $ 100,000.00 | $ 10,000.00 | 10% | 600% | $ 70,000.00 | $ (60,000.00) | $ 40,000.00 | $ 140,000.00 | 28.57% |
| $ 100,000.00 | $ 10,000.00 | 10% | 700% | $ 80,000.00 | $ (70,000.00) | $ 30,000.00 | $ 160,000.00 | 18.75% |
| $ 100,000.00 | $ 10,000.00 | 10% | 800% | $ 90,000.00 | $ (80,000.00) | $ 20,000.00 | $ 180,000.00 | 11.11% |
| $ 100,000.00 | $ 10,000.00 | 10% | 900% | $ 100,000.00 | $ (90,000.00) | $ 10,000.00 | $ 200,000.00 | 5.00% |
| $ 100,000.00 | $ 10,000.00 | 10% | 1000% | $ 110,000.00 | $ (100,000.00) | $ – | $ 220,000.00 | 0.00% |
Posted by Spartan656
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You may enjoy the latest book on the subject – *Margin for Dummies* by Leupold Aschenbrenner.