TradeStation Margin Requirements
Source: Notion | Last edited: 2023-08-29 | ID: d87d390d-2dd...
Futures are an inherently leveraged product, which means that at the time of placing an order, one cannot simply pay the full price, but must rather pay the initial margin. Margin requirements are set by the Broker (like TradeStation, Interactive Brokers, etc.) not the Exchange.
For example, if we want to purchase 1 BTC futures contract on the CME, at a price of 140,125. BUT, we don’t and can’t pay that much. Rather, we pay the initial margin, which the Broker decides is $41,800. Thus, we are effectively leveraged approximately 3x. If the price of the underlying asset decreases past the maintenance margin, then we will receive a margin call. That is, we must add money to our account, in order to satisfy the margin requirements. Margin Calls must be fulfilled within the same day.
To make things even more complicated, the Broker can change margin requirements anytime they want, depending on the volatility of the asset, AND margin requirements are different for each asset. Margin requirements may be different during the day and during the night.
Here are the current (August 29th, 2023) Margin Requirements for the Contracts that we are interested in, as provided by TradeStation:
Source: https://www.tradestation.com/pricing/futures-margin-requirements/
BTC: ~3.35x leverage
Section titled “BTC: ~3.35x leverage”Contract Value: 5 x 140,050
Intraday Initial: **$41,800 **
Intraday Maintenance: $38,000
Overnight Initial: $41,800
Overnight Maintenance: $38,000
CL (Oil): ~ 22x leverage
Section titled “CL (Oil): ~ 22x leverage”Contract Value: 1000 x ~81,160
Intraday Initial: **$3,630 **
Intraday Maintenance: $3,300
Overnight Initial: $7,260
Overnight Maintenance: $6,600
JPY: ~ 23x leverage
Section titled “JPY: ~ 23x leverage”Contract Value: 12,500,000 x ~85,968
Intraday Initial: $3,630
Intraday Maintenance: $3,300
Overnight Initial: $3,630
Overnight Maintenance: $3,300
Wheat: ~ 8x leverage
Section titled “Wheat: ~ 8x leverage”Contract value: 5000 x ~30,012
Intraday Initial: $3,630
Intraday Maintenance: $3,300
Overnight Initial: $3,630
Overnight Maintenance: $3,300
Soy: ~15x leverage
Section titled “Soy: ~15x leverage”Contract Value: 5000 x ~69,600
Intraday Initial: $4,620
Intraday Maintenance: $4,200
Overnight Initial: $4,620
Overnight Maintenance: $4,200
Corn: ~8.6x leverage
Section titled “Corn: ~8.6x leverage”Contract Value: 5000 x ~24,350
Intraday Initial: $2,805
Intraday Maintenance: $2,550
Overnight Initial: $2,805
Overnight Maintenance: $2,550