Please help with Margin requirements

Please help with Margin requirements?

I am not sure about this but if the margin requirement is 50%
it means that if I put in 10K I have another 10K as a margin??

However IF all my trades are up to 10K and I dont use the extra Margin made available by the broker (10K). I should never get a margin call even if my 10k goes to 1K??? At that point my margin will also become 1K......and there will be no reason to get a margin call

The only problem is if I have SHORTS...that went bad and the 10K tips over to the Margin?? Is this correct.
thx

Other Answers:

Margin is a complicated beast, each firm has diffrent percantage requiremetns, 50% is very high (the req is usually around 30, but let's say 50 for your example).

If you had $10,000 and took a margin loan of $10,000 you now have an account value of $20,000. If that drops to let's say $15,000 total you would be at 50% ($10,000 margin loan, and $5,000 of your orig money), this brings you to a 50% level and if the margin requirement is 50% you would be ok. But if it dropped to say.. 48% you would get a margin call, and you would have two options 1) send in a check for the amount you are short, or 2) sell securites to cover.

Your margin loan doesn't drop.. your account value does. You still owe back the orig loan. Think of it as if you asked somoene for $10,000 to borrow, and you invested it with your own cash, regardless of what the account went to, you still owe back the $10,000 (plus interest). Whatever market decreaes you see affect only your money not the loan.

Buying with borrowed money can be extremely risky because both gains and losses are amplified. That is, while the potential for greater profit exists, this comes at a hefty price - the potential for greater losses. Margin also subjects the investor to a number of unique risks such as interest payments for use of the borrowed money.