DIVERSIFIED INVESTMENTS AND TRADING
A complete multi-asset platform
CFDs on single stocks
Are you seeking ways to invest in both rising and falling markets? Investing in CFDs as single stocks and ETFs can be a good way to do that!
What are the initial and maintenance margins?
Initial and maintenance margins are designed to protect you against adverse market conditions, by creating a buffer between your trading capacity and the margin close-out level.
The initial margin is a pre-trade margin check on order placement. When opening a new position, in fact, there must be sufficient margin collateral available on the account to meet the initial margin requirements.
A maintenance margin is a continuous margin check and corresponds to the minimum amount of cash, or approved margin collateral, that must be maintained on the account to hold one or several positions. The maintenance margin is used to calculate the margin utilisation. A close-out or stop out will occur as soon as you no longer meet the maintenance margin requirements.
The initial and maintenance margins of a single stocks and ETF CFD are based on the rating. Cornèrtrader defines 6 different equity ratings. This rating derives from the market capitalization, liquidity and volatility of the underlying asset.
Cornèrtrader allows a percentage of the investment in certain Stocks and ETFs to be used as collateral for margin trading activities. The collateral value of a stock or ETF position depends on the rating of the individual stocks or ETFs – please see conversion table below.
Example: 75% of the value of a position in a stock or ETF with Rating 1 can be used as collateral (instead of cash) to trade margin products such as Forex, CFDs, futures and options.
All these products, like all derivate instruments, leverage with a higher risk of losing more than your deposit. Therefore, it is important to understand the products and the associated risks, use a moderate approach and keep sufficient collateral in the account when investing in them.