What Is Regulation T?
The Federal Reserve regulation governing the extension of credit by brokers and dealers to customers buying securities on margin. It sets the initial margin requirement (currently 50%), meaning customers must deposit at least 50% of the security's value in cash. Regulation T also defines margin maintenance rules and procedures for handling margin calls.
Regulation T across 2 exams
Regulation T appears on the following exams. Each defines it in the context candidates are tested on:
- SIE
- The Federal Reserve regulation governing the extension of credit by brokers and dealers to customers buying securities on margin. It sets the initial margin requirement (currently 50%), meaning customers must deposit at least 50% of the security's value in cash. Regulation T also defines margin maintenance rules and procedures for handling margin calls.
- Series 9/10
- A Federal Reserve rule governing the extension of credit by broker-dealers to customers, including the initial margin required to purchase securities. Supervisors must ensure customer margin accounts comply with its requirements.