Which of the following statements in relation to margins is correct?
A) An initial margin is held by the futures exchange.
B) The maintenance margin is the quantity of money you place with your broker when you buy or sell a futures contract.
C) The maintenance margin is the value of the margin account below which the holder receives a margin call.
D) All futures contracts have the same margin deposit.

Question

Quizplus · Accepted Answer

The maintenance margin is indeed the minimum amount of equity that must be maintained in a margin account. When the account balance falls below this level, the trader receives a margin call, requiring them to deposit additional funds to bring the account back up to the initial margin requirement.

Which of the Following Statements in Relation to Margins Is