Remargining

DEFINITION of 'Remargining'

The process of bringing an account up to minimum equity standards by depositing more cash or equity. This typically occurs after the account holder has received a margin call.

When a stock is purchased on margin in a margin account, the account holder is required to maintain certain levels of equity in that account. When these requirements are not met, the brokerage firm will require that additional cash or securities be deposited to bring the account up to minimum equity levels.

BREAKING DOWN 'Remargining'

When an individual purchases stock on margin, he or she must maintain equity in the account of up to 50% of the total value of the securities margined, or borrowed. If the stock should decline in value, the brokerage firm may issue a margin call, which is essentially a demand for the account owner to boost the equity position to the minimum requirement. When a person does this, he or she is said to be remargining the account.

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