Maintenance Performance Bond (Previously referred to a Maintenance Margin)
As a knowledgeable finance professor, I want to introduce you to the concept of performance bonds in futures trading. These are necessary deposits that customers must maintain in their accounts, in addition to the initial margin. They act as a safety net to cover any potential losses in a futures position. If the equity in a customer's account drops below the maintenance performance bond level, a "performance bond call" is issued, requiring them to deposit enough money to restore their equity back to the initial margin level. This ensures that the customer's account remains secure and able to continue trading.
Related terms
Understand the meaning and definition of Crop Reports in the context of stock market, trading, and investments.
MOREUnderstand the meaning and definition of Introducing Broker in the context of stock market, trading, and investments.
MOREUnderstand the meaning and definition of Margin Requirement for Options in the context of stock market, trading, and investments.
MOREUnderstand the meaning and definition of Federal Housing Administration (FHA) in the context of stock market, trading, and investments.
MOREUnderstand the meaning and definition of Security in the context of stock market, trading, and investments.
MOREUnderstand the meaning and definition of European-Style Options in the context of stock market, trading, and investments.
MORE
Enjoy Zero Brokerage On Stock Investments
Get the link to download the App
