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Margin Loans Timeframes for margin calls

Discussion in 'Finance & Banking' started by samaka, 17th Dec, 2007.

  1. samaka

    samaka Well-Known Member

    30th Sep, 2007
    Hi all,

    If your investment value drops far enough to trigger a margin call - how long do you have before you need to act on it?

    Are we talking days or weeks? I figure most lenders would give you a week minimum to cover temporary volatility - although I guess thats what the margin buffer is for...

    For example it would take a few days for me to transfer money out of my high-interest savings account and then make another contribution, or purchase more shares, or even pay down the loan.
  2. Simon Hampel

    Simon Hampel Co-founder Staff Member

    9th Jun, 2005
    Sydney, Australia
    24 hours ... although it often takes them a day or two to actually give you a margin call - but when they do, they expect immediate action. You may be able to hold them off if you can show evidence of taking action (eg funds transfers or sales / purchases).

    If you are already in your buffer zone - you should be taking action to ensure you have a plan for if you do get a margin call.