What is Interactive Broker's margin rules for stocks below $5?

Overview: 

Interactive Brokers does not have a special rule regarding stocks that trade below $5.   Although other brokerage firms may have a house rule regarding stocks trading below $5, IB does not employ such a rule.

Background: 

There are other IB-specific rules to consider in this scenario, however.  In general, IB would not have a special rule for long positions in stock trading below $5, as long as they are exchange-listed.  Once a stock is delisted from one of the exchanges and moved to the OTC market, it would be subject to a 100% margin requirement, since the stock would no longer be considered marginable. 

 

Also for long positions, the maintenance margin requirement is 30% of the stock value or $2,000, whichever is greater.

 

For short positions, the maintenance requirement on stock greater than $5, is $5 per share or 30% of the stock value, whichever is greater.  For short positions in stock where the last sale price/share is less than $5, then the maintenance margin requirement is $2.50 per share or 100% of the stock value, whichever is greater. 

 

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