Adjusted Debit Balance

Filed Under » , , , ,
Dictionary Says

Definition of 'Adjusted Debit Balance'

The amount in a margin account that is owed to the broker, minus profits on short sales and balances in a special miscellaneous account (SMA). The adjusted debit balance aids an investor in knowing how much he/she owes in the event of a margin call. Under Regulation T, one can borrow up to 50% of the purchase price of securities on margin.
Investopedia Says

Investopedia explains 'Adjusted Debit Balance'

Regulation T guidelines changed in 1982, making it less significant than in years past. However, the formula is still useful in determining the amount of money or securities that one can withdraw from a margin account. For example, things like "freeriding," a practice whereby a stock is bought and sold before it has been paid for, is not permitted. If/when freeriding occurs, the broker is obligated to freeze the investor's ability to buy on margin for 90 days.

Articles Of Interest

  1.

    Credit, Debit And Charge: Sizing Up The Cards In Your Wallet

    Not all plastic is equal! Learn the difference between the three kinds, and how each can affect your finances.

  2. Understanding Forex Rollover Credits And Debits

    Forex trades are subject to receiving interest or being debited interest if positions are held overnight.

  3. Debit Spreads: A Portfolio Loss Protection Plan

    There are ways to control risks, reduce losses and increase the likelihood of success in your portfolio. Find out how spreads can help.

  4. 401(k) Debit Cards: Taking A Swipe At Your Retirement Savings

    This is just another more convenient way to borrow from your plan. But at what cost?

  5. Why do accountants use debits and credits instead of simple pluses and minuses? Why is the notation for a debit "DR"?

    Debits and credits, and the technique of double-entry accounting, are credited (no pun intended) to a Franciscan monk by the name of Luca Pacioli. Known as the "Father of Accounting", he warned ...

  6. A Primer On The MACD

    Learn to trade in the direction of short-term momentum.

  7. When To Short A Stock

    Learn how to make money off failing shares.

  8. Market Summary for September 6, 2013

    The major U.S. indices moved lower this week, after a lackluster jobs report sent shares lower on Friday morning.

  9. Market Summary for August 30, 2013

    The major U.S. indices moved lower this week, but remain within long-term price channels. Traders should watch for breakouts or breakdowns from these price channels for the best opportunities.

  10. How Leverage Is Used In Forex Trading

    Forex trading by retail investors has grown by leaps and bounds in recent years, thanks to the proliferation of online trading platforms and the availability of cheap credit. The use of leverage ...
comments powered by Disqus
Marketplace
Hot Definitions

  1. Racketeering

    Racketeering refers to criminal activity that is performed to benefit an organization such as a crime syndicate. Examples of racketeering activity include...

  2. Lawful Money

    Any form of currency issued by the United States Treasury and not the Federal Reserve System, including gold and silver coins, Treasury notes, and Treasury bonds. Lawful money stands in contrast to fiat money, to which the government assigns value although it has no intrinsic value of its own and is not backed by reserves.

  3. Fast Market Rule

    A rule in the United Kingdom that permits market makers to trade outside quoted ranges, when an exchange determines that market movements are so sharp that quotes cannot be kept current.

  4. Absorption Rate

    The rate at which available homes are sold in a specific real estate market during a given time period.

  5. Yellow Sheets

    A United States bulletin that provides updated bid and ask prices as well as other information on over-the-counter (OTC) corporate bonds...

  6. Bailment

    The contractual transfer of possession of assets or property for a specific objective.
Trading Center