BROWSE

Federal Call

What is 'Federal Call'

A special type of margin call requiring a trader to deposit sufficient cash in order to meet federal requirements on the amount of credit that brokers may extend. These margin requirements are set by Regulation T of the Code of Federal Regulations, Title 12 - Banks and Banking. Currently the margin requirements are 50% for equities. For short sales, the margin requirement is between 100% and 150% of the current market value of the security being sold short. Regulatory authorities has the power to change these margin requirements as they deem necessary.

Explaining 'Federal Call'

The purpose of Regulation T and federal calls are to moderate the amount of financial risk present in the securities markets. Since using margin amplifies both gains and losses relative to the initial investment, a broad overuse of margin has the potential to cause instability in financial markets as a whole. Since disruptions in the financial markets can interfere with the broader economy, regulators wish to have the controls necessary to promote orderly market functioning.


Further Reading


An empirical comparison of published replication research in accounting, economics, finance, management, and marketing
www.sciencedirect.com [PDF]
… proliferation in the social and behavioral sciences is so wide- spread as to call into question … with "insignificant" (p > .05) results for publication, leads to what Rosenthal (1979) calls the "file … claim of Mankiw, Miron, and Well (1987) that the creation of the Federal Reserve System …

The call loan market in the US financial system prior to the Federal Reserve SystemThe call loan market in the US financial system prior to the Federal Reserve System
papers.ssrn.com [PDF]
… proliferation in the social and behavioral sciences is so wide- spread as to call into question … with "insignificant" (p > .05) results for publication, leads to what Rosenthal (1979) calls the "file … claim of Mankiw, Miron, and Well (1987) that the creation of the Federal Reserve System …

The financial market effects of the Federal Reserve's large-scale asset purchasesThe financial market effects of the Federal Reserve's large-scale asset purchases
www.ijcb.org [PDF]
… proliferation in the social and behavioral sciences is so wide- spread as to call into question … with "insignificant" (p > .05) results for publication, leads to what Rosenthal (1979) calls the "file … claim of Mankiw, Miron, and Well (1987) that the creation of the Federal Reserve System …

Assessing regional economic stability: a portfolio approachAssessing regional economic stability: a portfolio approach
search.proquest.com [PDF]
… proliferation in the social and behavioral sciences is so wide- spread as to call into question … with "insignificant" (p > .05) results for publication, leads to what Rosenthal (1979) calls the "file … claim of Mankiw, Miron, and Well (1987) that the creation of the Federal Reserve System …

Risk-shifting incentives of depository institutions: A new perspective on federal deposit insurance reformRisk-shifting incentives of depository institutions: A new perspective on federal deposit insurance reform
www.sciencedirect.com [PDF]
… proliferation in the social and behavioral sciences is so wide- spread as to call into question … with "insignificant" (p > .05) results for publication, leads to what Rosenthal (1979) calls the "file … claim of Mankiw, Miron, and Well (1987) that the creation of the Federal Reserve System …

The financial crisis of 2008: A clarion call to include economic policy and financial illiteracy on public administration's intellectual radar screenThe financial crisis of 2008: A clarion call to include economic policy and financial illiteracy on public administration's intellectual radar screen
www.tandfonline.com [PDF]
… proliferation in the social and behavioral sciences is so wide- spread as to call into question … with "insignificant" (p > .05) results for publication, leads to what Rosenthal (1979) calls the "file … claim of Mankiw, Miron, and Well (1987) that the creation of the Federal Reserve System …

The Perfect Storm: How Mortgage-Backed Securities, Federal Deregulation, and Corporate Greed Provide a Wake-Up Call for Reforming Executive CompensationThe Perfect Storm: How Mortgage-Backed Securities, Federal Deregulation, and Corporate Greed Provide a Wake-Up Call for Reforming Executive Compensation
heinonline.org [PDF]
… proliferation in the social and behavioral sciences is so wide- spread as to call into question … with "insignificant" (p > .05) results for publication, leads to what Rosenthal (1979) calls the "file … claim of Mankiw, Miron, and Well (1987) that the creation of the Federal Reserve System …

The theory of public finance in a federal systemThe theory of public finance in a federal system
www.jstor.org [PDF]
… proliferation in the social and behavioral sciences is so wide- spread as to call into question … with "insignificant" (p > .05) results for publication, leads to what Rosenthal (1979) calls the "file … claim of Mankiw, Miron, and Well (1987) that the creation of the Federal Reserve System …


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