Extra money demanded when collateral falls short
A margin call is the additional deposit required when the collateral behind a margin position falls below the set level. Miss the deadline and the position is closed out for you. Forced closures piling up is part of why selling begets selling in a falling market. Borrowing to trade turns a price fall into a demand for cash as well as a loss.
If the floor is set at 20% collateral, dropping below it triggers a call that must be met by the deadline.
Japan — In Japanese margin trading a call is triggered when collateral falls below 20%, normally due two business days later (as of 2026).
South Korea — In Korean margin trading the broker takes collateral of at least 140% of the loan, and each broker sets the ratio that must be maintained afterwards. If it is breached and not topped up by the set date, the broker may sell the pledged shares the next business day (as of 2026).
For learning, not investment advice. Decisions are your own.
StockFit · TrueNorthLabs Inc.