TradeStation Help

About Overnight Buying Power

Overnight Buying Power is calculated by dividing the margin account's Excess Equity by the Federal Reserve Board Regulation T Margin Requirement as established by the Securities Exchange Act of 1934. Currently the Regulation T Margin Requirement is 50% for both long and short positions. The excess equity is calculated by Cash Balance + Long Market Value + Credit Balance - Short Market Value - Margin Requirement - Margin Debit. The Margin Requirement can be higher, up to 100%, for certain 'Hard To Margin' securities as determined by TradeStation, including the following instances:

• Long positions on securities priced at or below $5.00/share carry an automatic margin requirement of 100%.  
• Short positions on securities priced at or above $5.00/share carry a minimum margin requirement of $5.00/share.
• Short Positions on securities priced below $5.00/share are special exceptions and carry a margin requirement of 100% or $2.50/share, whichever is greater.

 For an example of how Overnight Buying Power is calculated through a series of transactions, see Overnight Buying Power Example.