China Raises Margin Financing Deposit Ratio to 100% From 80%

The change increases required deposits for margin financing to 100%, up from 80%.

Summary

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Terms & Concepts
  • Margin financing: Borrowing funds from a broker to buy securities, using holdings as collateral.
  • Deposit ratio: The required percentage of funds or collateral that must be posted to obtain margin financing.
  • Leverage: Using borrowed capital to increase investment exposure and potential gains or losses.