Strategy-based margin
Definition · Level 4 · Naked options
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Rule-based requirement set per position type by formula — e.g. for a short equity option the typical minimum is premium + 20% of the underlying − the OTM amount, with a floor of premium + 10% (Reg T / exchange style).
Example
Short 105 call at 2.00, stock 100 → 2 + 20 − 5 = 17 (floor 12) → $1,700.
Rules and market figures change: check the current ones before relying on this.
Where Tradecraft teaches it
Level 4 · Naked options, in the lesson “Naked margin: how brokers size it”: The typical strategy-based formula, why requirements expand against you, and portfolio margin.
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