Strategy

Margin Required at Time of Purchase

Long (Buy) Call or Put

100% of the option’s premium.

Covered Write
(selling a call covered by long position, or a put covered by short position)

No additional margin is required when the underlying interest is held (or short for puts) in the account.

Uncovered (Naked) Calls or Puts

100% of premium LESS any out-of-the-money amount PLUS one of the following:

(Uncovered call: Subject to the minimum % requirement on the underlying interest

Uncovered put: Subject to the minimum % requirement on the aggregate exercise value of the option)

Equities

+ Margin requirement of the underlying(minimum 5%)
NOTE : $10,000 equity required for uncovered equity writing.

US Index

+ 15% of the Broad Based Index Level (min 10%)
+ 20% of the Narrow Based Index Level (min 10%)

CDN Index

+ 12.25% (minimum 5%)
NOTE : $25,000 equity required for uncovered index writing.

Bonds

+ 4% (minimum 0.50%)

Currency

+ 5.8% (minimum 0.75%)

NOTE : $25,000 equity required for uncovered currency writing

Debit Spread
(Bull Call & Bear Put)

100% of the debit.

NOTE: $5,000 equity requirement for spreads (Level 3 Options Approval)

Credit Spread
(Bear Call & Bull Put)

Note: Short cannot expire after long position

The lesser of:

The margin requirement for the uncovered call,
​OR

The margin requirement for the uncovered put,
OR

100% of the difference between the strike prices of the long and short options LESS the NET credit received

Note: $5,000 equity requirement for Spreads (Level 3 Options Approval)

Note: $1,000/contract equity requirement for Index Spreads (Level 3 Options Approval)

European Exercised Calendar Spread
(Long Call with Short Call/Long Put with Short Put, same strike, different expiry)

2% of the underlying level

Note: $5,000 equity requirement for Spreads (Level 3 Options Approval)

Note: $1,000/contract equity requirement for Index Spreads (Level 3 Options Approval)

Long Straddle/Combo
(Buy Call & Put)

The total premium of the long call and long put option.

Short Straddle/Combo
(Sell Call & Put)

The greater of:

Margin requirement on the short call;
OR

Margin requirement on the short put;
PLUS

The market value of the option with the lower margin requirement

Buy-Write
(Buy Stock & Sell Call for combined debit)

The premium received from the option may be applied to the purchase. Please note that the maximum loan value is based on: the lower of the market value of the stock or the exercise value of the short call. The short call acts as a cap, limiting the profit potential.

Reverse Buy-Write
(Closing a Buy-Write)

No additional margin is required if it is a closing transaction. There will be a net credit in the account.

Listed Options

Concentration Guidelines 1

Broad-Based Index Options ²

$1,000,000 Margin Limit

Narrow-Based Index Options & Equity Options

$500,000 Margin Limit