Options Margin Calculator
Estimate the capital a position ties up under Reg T — from a fully collateralised cash-secured put to an uncovered short call. Pick the structure, enter the strikes, see the working.
These are Reg T estimates. Your broker is the authority.
Margin is not a single universal number. This calculator applies the standard Reg T formulas for equity options in a margin account. Your broker almost certainly applies house requirements on top, and those are frequently higher — sometimes several times higher on volatile names, ahead of earnings, or near expiration.
A portfolio margin account uses an entirely different, risk-based calculation and these figures will not match it. Before you size a trade, check the requirement your own broker quotes for your own account.
What is Options margin requirement?
Options margin requirement is the capital your broker holds against a position for as long as it is open. Defined-risk structures require their maximum loss. Uncovered short options require a risk-based deposit computed from the underlying price, the strike, and the premium.
This calculator estimates that figure under Reg T and shows which branch of the formula binds.
Your Position
Premiums and credits are per share, the way a chain quotes them. One contract covers 100 shares. Compare the trade itself on the credit spread calculator or the cash-secured put calculator.
Estimated Requirement
Reg T estimate for an equity option in a margin account. It excludes house requirements, concentration add-ons and any portfolio margin treatment. Treat it as a planning figure, never as the number your broker will hold.
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How to Use the Margin Calculator
Pick the structure
The position type drives which formula applies. A short put is collateralised very differently depending on whether it is cash-secured or uncovered, and the inputs change with it.
Enter strikes and premium
Use per-share figures, as the chain quotes them. For spreads, enter the net credit or debit for the package rather than each leg. Uncovered positions also need the underlying price — both branches of the formula are anchored to it.
Read the working, not just the total
For uncovered options the table shows both Reg T branches and marks the one that binds. If the 10% floor is binding, the option is far enough out of the money that the 20% test has fallen away.
Confirm with your broker
Load the order in your platform's preview screen before sizing anything. The number your broker quotes is the one actually held, and it includes house requirements this calculator cannot know.
The Reg T formulas
- = Cash-secured put: strike x 100 x contracts — full collateral, no leverage
- = Covered call: nothing beyond the 100 shares per contract you already hold
- = Credit vertical: (width − net credit) x 100 x contracts — the max loss
- = Debit vertical: the debit paid, in full, at entry — no ongoing requirement
- = Iron condor: (wider width − net credit) x 100 x contracts — only one side can lose
- > Naked put: greater of (20% of underlying − OTM amount + premium) and (10% of strike + premium)
- > Naked call: greater of (20% of underlying − OTM amount + premium) and (10% of underlying + premium)
Why Defined-Risk Structures Require So Much Less Capital
The gap is not a broker preference. It falls out of what each structure can actually lose.
A vertical credit spread owns a long option behind the short one. Whatever the underlying does, that long leg takes over past its strike and the loss stops. The worst outcome is known before the trade is placed — strike width minus net credit — so the requirement is simply that number. A $5-wide spread taken for a $1.50 credit can lose $350 and not a dollar more, so $350 is held. An iron condor gets one extra concession: the stock cannot finish below the put spread and above the call spread at once, so only the wider wing is charged.
A naked short option has no such ceiling. A short put's loss runs to a stock price of zero; a short call's has no upper bound at all. With no maximum loss to hold, Reg T holds a deposit sized to absorb an ordinary adverse move: 20% of the underlying, relieved by however far out of the money the option sits, plus the premium. The second branch — 10% of the strike for puts, 10% of the underlying for calls — is a floor that stops a far out-of-the-money short from costing nothing to carry.
Run the same short $175 put on a $185 stock through all three. Cash-secured it ties up $17,500; uncovered under Reg T, roughly $3,000; as a $175/$170 credit spread taken for $1.50, $350. Same directional view, requirements spanning fifty to one — because the three positions can lose completely different amounts.
The part worth being careful about: less capital held is not less risk taken. The spread's $350 is a genuine ceiling. The naked put's $3,000 is only a deposit. If the stock gaps to $140, the spread has lost its $350 and stopped, while the uncovered put is down roughly $3,200 per contract and the broker will ask for more. A requirement is a margin figure, not a loss estimate, and sizing a position off the requirement alone is how accounts get into trouble.
Reg T Versus Portfolio Margin
Everything above describes Reg T, the fixed rules-based regime that applies to a standard margin account. It looks at positions largely one at a time and applies a formula. Portfolio margin works from the other end: it stress-tests the whole account across price and volatility scenarios and charges the worst result. A well-hedged book can see its requirement fall substantially; concentrated single-name risk can be charged more than Reg T would. It is a separate account type with its own approval and an equity minimum, commonly $100,000 or more, and the figures here will not match it.
Other things this calculator does not model: broker house requirements, which often exceed Reg T and can rise around earnings; concentration and hard-to-borrow add-ons; the 15% base used for broad-based index options; futures options, which use SPAN rather than Reg T; and the restrictions on cash accounts and IRAs, where uncovered short options are generally not permitted at all.
Frequently Asked Questions
How is Reg T margin calculated on a naked put?
Take the greater of two figures, then multiply by 100 per contract. First: 20% of the underlying, minus the amount the put is out of the money, plus the premium. Second: 10% of the strike plus the premium. On a $185 stock with a short $175 put sold for $3.00, that is $30.00 versus $20.50, so about $3,000 per contract. Brokers commonly add a house minimum, often around $250 per contract.
What is the difference between Reg T margin and portfolio margin?
Reg T applies a fixed formula position by position and is what this calculator estimates. Portfolio margin stress-tests the entire account across price and volatility moves and charges the worst case. It often requires far less on hedged books, sometimes more on concentrated risk, and needs a separate account approval with an equity minimum that is typically $100,000 or more.
Why does a credit spread require so much less margin than a naked put?
The spread's long leg caps the loss, so the requirement is that cap: width minus credit. A naked short has no cap, so the requirement is a risk-based deposit instead. Lower capital is not lower risk — the spread's loss really does stop, whereas a naked position's loss can run past the deposit held.
Does a covered call require additional margin?
No. A call written against 100 shares per contract that you already own is covered, and the shares are the collateral. They are held until the call expires, is closed, or is assigned. If those shares are themselves financed on margin, the stock's own maintenance requirement still applies.
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