This spreadsheet shows the percentage market drop required to trigger a margin call for a range of Loan-to-Value ratios.
The spreadsheet will calculate the % drop in the market to trigger a margin call.
- enter the amount of the margin loan into cell B1
- enter the initial value of the portfolio (before the market drop) into cell B2
- enter the margin buffer into cell B3 (this will usually be 5% or 10%, depending on the margin lender)
- enter the max gearing ratio for the portfolio into cell B4.