What Margin Changes Mean for Traders

Changes in margin requirements impact the market - find out if they help or hurt your holdings.

   

Looking at the S&P 500, this latest draw down appears to be a correction, rather than a true panic. The most significant difference between a correction and a crash is forced selling, when institutional sellers are forced to liquidate and rebalance their portfolios. Historically, changes in margin requirements can negatively affect the market. But while we do have to deal with volatility and choppiness, which is tough, in general I don’t think we’re in for anything that’s really unexpected.


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