February 22, 2026 • 6 min read

Portfolio Margin 101

Portfolio margin (PM) lets brokers calculate margin using the actual risk of your positions instead of fixed percentage haircuts. For institutional and active traders, that usually means less margin — and more capital efficiency — than under Regulation T. But not all brokers use the same model, and the same portfolio can get very different requirements depending on where you clear.

Reg T vs Portfolio Margin

Under Reg T, margin is rule-based: long equity is typically 50% initial, 25% maintenance; short equity is 150% / 130%. The rules do not care whether your book is hedged or concentrated. A long/short fund with net exposure near zero still posts margin as if every position were standalone.

Portfolio margin is risk-based. The broker runs stress scenarios (e.g. broad market down 15%, up 15%, vol shocks) and sets your requirement at the worst-case loss across those scenarios, often with netting across correlated positions. Hedged books benefit; concentrated, directional books do not.

FINRA Rule 4210 requires a minimum of $125,000 equity for portfolio margin and mandates that the calculation use at least the OCC’s TIMS (Theoretical Intermarket Margining System) methodology. TIMS is the regulatory floor — your broker can (and usually does) add house charges on top.

Why Do Broker Requirements Differ?

TIMS is the same everywhere; the differences come from house methodology:

• Scan ranges — Some firms use wider stress moves (e.g. ±20%) than TIMS (±15% equity), which increases base requirement.
• Concentration — Large single-name or single-sector exposure often gets an extra charge. Top positions may be stressed at ±30% or more.
• Liquidity — Illiquid names can get a surcharge (e.g. days-to-liquidate vs average daily volume).
• Floors — A minimum margin as a % of gross or per-contract minimums for options.
• Netting — How much offset they give for hedged or negatively correlated positions.

So the same portfolio can show $15M at one broker and $28M at another. Comparing methodologies — OCC TIMS, IBKR, Schwab, Clear Street, and others — is exactly what our Portfolio Builder does: one book, multiple broker estimates, so you can see who is conservative and who is efficient.

What You Can Do With It

• Pre-trade — Gauge margin impact before adding or unwinding positions.
• Broker selection — See which clearing relationship gives you the best capital treatment.
• Stress check — Our risk report combines margin with stress scenarios (200 DMA reversion, vol shock, sector stress) so you see both margin requirement and tail risk in one place.

Portfolio margin is a powerful tool for capital efficiency, but only if you understand how your broker’s model works. We built the comparison so you don’t have to guess.