Margin Question

[misterkel]

Looking at this buy-write:

and this is the maintenance margin:

Equity is +470 post trade
Entry cost is 270
MM is 1150
1150 - 470 = 680

Why is the holding cost 680 for a trade that can only lose 269 MAX?
Am I missing something obvious?

How can a CC cost more margin - equity than the Maximum loss?

 

[wxytrader]

Looking at this buy-write:

View attachment 332317

and this is the maintenance margin:

View attachment 332318


Equity is +470 post trade
Entry cost is 270
MM is 1150
1150 - 470 = 680

Why is the holding cost 680 for a trade that can only lose 269 MAX?
Am I missing something obvious?

How can a CC cost more margin - equity than the Maximum loss?

Buying power

 

[Quanto]

Looking at this buy-write:

View attachment 332317

and this is the maintenance margin:

View attachment 332318


Equity is +470 post trade
Entry cost is 270
MM is 1150
1150 - 470 = 680

Why is the holding cost 680 for a trade that can only lose 269 MAX?
Am I missing something obvious?

How can a CC cost more margin - equity than the Maximum loss?

I too wonder when the margin requirement is way higher than the max possible loss.

It's aprroximately this CC trade: https://optioncreator.com/steb7lu

 

[redneckrick]

Looking at this buy-write:

View attachment 332317

and this is the maintenance margin:

View attachment 332318


Equity is +470 post trade
Entry cost is 270
MM is 1150
1150 - 470 = 680

Why is the holding cost 680 for a trade that can only lose 269 MAX?
Am I missing something obvious?

How can a CC cost more margin - equity than the Maximum loss?

Is this with IB? I seem to recall they've got some kind of minimum margin thing on penny stocks that get's you margins bigger than max possible losses?

 

[misterkel]

Is this with IB? I seem to recall they've got some kind of minimum margin thing on penny stocks that get's you margins bigger than max possible losses?

Makes sense. Not the first time I've seen it on IB. thanks.