Is Maintenance Margin Typically Higher or Lower than Initial Margin?
Maintenance margin is almost always lower than the initial margin. The initial margin is the deposit required to open the position, acting as a larger buffer.
The maintenance margin is the minimum threshold that the account equity must not fall below. The difference between the two provides a cushion for the trader to absorb losses before a margin call is triggered.
Glossar
Lower Operational Costs
Benefit ⎊ Lower Operational Costs represent a core economic justification for the adoption of distributed ledger technology in the financial derivatives sector, directly enhancing net profitability.
Lower Strike Call
Moneyness ⎊ A lower strike call option refers to a contract where the strike price is set below the current market price of the underlying asset.
Margin Deposit Calculation
Calculation ⎊ Margin Deposit Calculation is the quantitative process used by derivatives exchanges and protocols to determine the minimum collateral amount a trader must post to initiate and maintain a leveraged position.
Crypto Derivatives Trading
Leveraged Exposure ⎊ Crypto Derivatives Trading involves the strategic deployment of capital using instruments like perpetual futures and options to speculate on or hedge the price action of cryptocurrencies.
Lower Assurance Metrics
Framework ⎊ Lower assurance metrics, within cryptocurrency derivatives, options trading, and broader financial derivatives, represent a pragmatic approach to risk assessment where complete data transparency or rigorous validation is absent or cost-prohibitive.
Margin Level Safety Net
Safety ⎊ The margin level safety net represents the excess collateral held in a trader's account above the minimum maintenance margin requirement, serving as a protective layer against market volatility.
Lower Premium Higher Upside
Premium ⎊ The concept of lower premium higher upside describes a trade-off inherent in purchasing out-of-the-money (OTM) call options on a cryptocurrency.
Lower Bound Price Estimation
Price ⎊ Lower bound price estimation, within cryptocurrency derivatives, options trading, and broader financial derivatives, represents a quantitative technique for determining a theoretical minimum price level for an asset or contract.
Call Option Lower Price
Valuation ⎊ A call option's lower price refers to a contract premium that is relatively inexpensive, often a consequence of a lower intrinsic value or reduced extrinsic value.
Initial Margin Definitions
Definition ⎊ Initial Margin Definitions specify the minimum amount of collateral a trader must deposit and maintain in a margin account to open a new leveraged position in futures, options, or other derivatives.