## Margin Account Value Solution

STEP 0: Pre-Calculation Summary
Formula Used
Margin Account Value = (Margin Loan)/(1-Maintenance Margin)
MAV = (ML)/(1-MM)
This formula uses 3 Variables
Variables Used
Margin Account Value - Margin Account Value refers to the total worth of assets held in a margin trading account.
Margin Loan - Margin Loan is a type of loan provided by a brokerage firm or financial institution to an investor, allowing them to borrow funds to purchase securities.
Maintenance Margin - Maintenance Margin refers to the minimum amount of equity that an investor must maintain in a margin account to comply with the requirements set by the brokerage firm.
STEP 1: Convert Input(s) to Base Unit
Margin Loan: 12000 --> No Conversion Required
Maintenance Margin: 0.4 --> No Conversion Required
STEP 2: Evaluate Formula
Substituting Input Values in Formula
MAV = (ML)/(1-MM) --> (12000)/(1-0.4)
Evaluating ... ...
MAV = 20000
STEP 3: Convert Result to Output's Unit
20000 --> No Conversion Required
20000 <-- Margin Account Value
(Calculation completed in 00.004 seconds)
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IGNOU (IGNOU), India
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## Margin Account Value Formula

Margin Account Value = (Margin Loan)/(1-Maintenance Margin)
MAV = (ML)/(1-MM)

## What do you mean by Margin Account Value ?

Margin Account Value refers to the total valuation of assets held in the margin trading account. Margin trading allows investors to borrow funds from a broker to purchase securities. The margin account value is a combination of the investor's own funds (the initial investment) and any borrowed funds (the margin).The investor deposits a certain amount of money into the margin account, which serves as collateral. With a margin account, the investor can borrow additional funds from the broker, typically up to a certain percentage of the value of eligible securities held in the account. The investor uses the combined amount of their own funds and borrowed funds to purchase securities. There's a maintenance requirement imposed by the broker, which is the minimum amount of equity that must be maintained in the account. If the value of the securities falls below this requirement, the investor may receive a margin call, requiring them to either deposit more funds or sell securities.

## How to Calculate Margin Account Value?

Margin Account Value calculator uses Margin Account Value = (Margin Loan)/(1-Maintenance Margin) to calculate the Margin Account Value, Margin Account Value is the the total worth of assets in the margin account after accounting for both the investor's own funds and any borrowed funds. Margin Account Value is denoted by MAV symbol.

How to calculate Margin Account Value using this online calculator? To use this online calculator for Margin Account Value, enter Margin Loan (ML) & Maintenance Margin (MM) and hit the calculate button. Here is how the Margin Account Value calculation can be explained with given input values -> 20000 = (12000)/(1-0.4).

### FAQ

What is Margin Account Value?
Margin Account Value is the the total worth of assets in the margin account after accounting for both the investor's own funds and any borrowed funds and is represented as MAV = (ML)/(1-MM) or Margin Account Value = (Margin Loan)/(1-Maintenance Margin). Margin Loan is a type of loan provided by a brokerage firm or financial institution to an investor, allowing them to borrow funds to purchase securities & Maintenance Margin refers to the minimum amount of equity that an investor must maintain in a margin account to comply with the requirements set by the brokerage firm.
How to calculate Margin Account Value?
Margin Account Value is the the total worth of assets in the margin account after accounting for both the investor's own funds and any borrowed funds is calculated using Margin Account Value = (Margin Loan)/(1-Maintenance Margin). To calculate Margin Account Value, you need Margin Loan (ML) & Maintenance Margin (MM). With our tool, you need to enter the respective value for Margin Loan & Maintenance Margin and hit the calculate button. You can also select the units (if any) for Input(s) and the Output as well.
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