Trading on margin can supercharge your investment returns—but it also comes with unique risks and responsibilities. At the heart of this is the maintenance margin: a critical concept every Australian investor using leverage must understand. With 2025 bringing fresh ASX policy updates and volatility in global markets, now is the time to get clear on what maintenance margin means for your portfolio—and how to avoid costly margin calls.
What Is Maintenance Margin?
Maintenance margin is the minimum amount of equity you must maintain in your margin account after buying securities on borrowed funds. Unlike the initial margin (the upfront deposit required to open a leveraged position), maintenance margin is about what happens after your trades are live. If your account equity falls below this threshold due to market movements, your broker will issue a margin call—requiring you to deposit more funds or sell assets to restore the balance.
- For ASX equities: Maintenance margin requirements typically range from 25% to 40% of the total market value of your holdings.
- For derivatives (e.g., CFDs, futures): Requirements are set by the exchange or broker and can be much higher due to increased volatility.
For example, if you buy $50,000 of shares on margin with a 30% maintenance margin, you must always have at least $15,000 in equity. If the share price falls and your equity drops below $15,000, you’ll face a margin call.
2025 Policy Updates and Their Impact
This year, the ASX and major Australian brokers have adjusted their risk controls in response to global market volatility and the rising popularity of leveraged products among retail investors. Here’s what’s changed in 2025:
- Higher Minimums on Volatile Stocks: The ASX has raised maintenance margin requirements for selected tech and mining stocks, some up to 50%, due to their recent price swings.
- Stricter Monitoring: Brokers are now required to conduct real-time monitoring of client accounts, issuing automated margin calls as soon as the threshold is breached.
- New Client Education Standards: ASIC has mandated that brokers provide clearer margin risk disclosures and educational resources before onboarding new margin clients.
These changes mean investors must be more vigilant than ever about their account balances and market conditions. Failure to act quickly on a margin call can result in automatic liquidation of positions—often at the worst possible time.
Managing Maintenance Margin Risk: Practical Strategies
Staying on top of your maintenance margin isn’t just about avoiding panic calls from your broker—it’s about protecting your capital and keeping your investment strategy on track. Here are some practical steps for Australian investors in 2025:
- Set Automated Alerts: Most trading platforms now offer real-time notifications when your equity approaches the maintenance margin level.
- Maintain a Cash Buffer: Keep extra funds in your margin account to cushion against sudden market drops.
- Diversify Holdings: Spread your leveraged investments across sectors to reduce the impact of individual stock volatility.
- Review Broker Policies: Check your broker’s margin schedules—maintenance requirements can differ by asset, and some may change during periods of high volatility.
- Stay Informed: Monitor ASX announcements and global market news, as policy shifts can directly affect margin requirements.
For example, after the 2025 ASX rule changes, some investors were caught out by rapid increases in maintenance margin on popular lithium stocks. Those with a cash buffer or diversified portfolios weathered the volatility far better than those operating on the edge.
The Bottom Line: Don’t Let Margin Calls Catch You Out
Maintenance margin is more than a technicality—it’s a vital safeguard that can make or break your leveraged investment journey. With 2025’s tighter rules and shifting markets, Australian investors must take a proactive approach to risk management. Regularly monitor your account, stay up to date with policy changes, and always trade within your risk tolerance. In the world of margin trading, knowledge and discipline are your best defences.
