The total market value of securities in your account.
The total market value of all long positions in your account.
The total market value of all short positions in your account, calculated as a negative amount in the securities market value.
Max Buying Power is an approximate figure calculated based on available funds. Canadian brokers usually require a 30% margin for stocks, so Max BP is calculated as available funds divided by 30%.
For example, with 30k CAD available funds, the max BP is 100k CAD. This estimate mainly applies to stocks and may not fully reflect the requirements of derivatives or specific stocks with different margin requirements. If the margin account's assets fall below 2,500 CAD, it operates as a cash account with Max BP equal to the available funds.
Available funds are the actual amount available for purchasing securities. If available funds are negative, further asset purchases are not permitted.
Calculation: Available Funds = Total Net Assets – Position Value in US Options – Initial Margin
The leverage ratio is an indicator that measures the risk level of your portfolio.
Calculation:
Leverage Ratio = Gross Position Value / Net Assets
Gross Position Value = Long Position Value + Absolute Value of Short Position Value
For example, if you have a $5k cash balance, $5k in short positions, and $40k in long positions, the gross position value would be $45k. In the calculation of net assets, these positions will offset, resulting in $40k($40k-$5k+$5k). Then your Leverage Ratio = 45/40 = 1.125.
Excess liquidity refers to the additional funds that you have after taking into account what is required to purchase your current positions.
Calculation: Excess liquidity = Net Assets - Position Value in US Options – Initial Margin
The initial margin is the sum of the initial margins for all securities. Canadian brokers typically require a 30% initial margin for most stocks, but other ratios may occur, influenced by factors such as the direction of holdings, asset type, currency, and liquidity.
The maintenance margin is the sum of the maintenance margins for all securities. Canadian brokers typically require a 30% maintenance margin for most stocks, but other ratios may occur, influenced by factors such as the direction of holdings, asset type, currency, and liquidity.