If the value of your account equity falls below the Maintenance Margin , your broker will issue a margin call, requiring you to deposit more cash or liquidate positions immediately.
While you often can't use margin to buy the options, you can sometimes use the value of your options as collateral to increase your overall account's Buying Power . The "Two Sides" of Margin Requirements buying options on margin
Options with more than 9 months to expiration are often marginable. You may be allowed to borrow up to 25% of the cost, meaning you must put up an initial margin of 75%. If the value of your account equity falls
Collateral to ensure you can fulfill the obligation if assigned. You may be allowed to borrow up to
Options with 9 months or less until expiration cannot be purchased on margin. You must pay 100% of the premium upfront.
In a traditional stock trade, Regulation T typically allows you to borrow up to 50% of the purchase price. Options differ significantly: