Margin calls\, leverage lower than 2008 amid steep stock market crash

Margin calls, leverage lower than 2008 amid steep stock market crash

Market participants attribute this to regulatory tightening and standardisation of margin requirements, stringent reporting for brokers, and segregation of client funds

Ashley Coutinho  |  Mumbai 

The steep market crash over the past few sessions has triggered margin calls, albeit on a far lower scale than seen during the financial crisis of 2008. Market participants attribute this to regulatory tightening and standardisation of margin requirements, stringent reporting for brokers, and segregation of client funds.

Wealthy investors hold far fewer concentrated and leveraged portfolios like they used to. The lacklustre performance of midcap stocks over the past two years has also reduced leverage in the system. The recent fall led several brokers to reduce or block leverage products ...

First Published: Mon, March 16 2020. 00:12 IST