Account at Maintenance

See margin maintenance.

You can set up a brokerage account if you want to buy and sell stocks and other securities like a rock star. If your account gets listed as "account at maintenance," consider it a yellow flashing light warning you that... there's a problem. Danger, danger, Will Robinson.

Example

This situation usually happens if you borrow from yourself or your brokerage firm to invest. For example, you might get a brokerage account with Fidelity that has a 50% margin. That means that if you pony up $15,000 of your own dough, Fidelity will let you buy up to $30,000 in securities. You might decide to get $29,500 in investments, which leaves you about $500 in wiggle room or equity (you have $15,000 of your own cash in there, but the $14,500 from Fidelity is kind of a loan).

The tiny print in your brokerage account agreement says that you can't go too far into debt on the account. If the Fed Chairman sneezes and the market goes down a percent or two, you will suffer a margin call, which means you'll be forced to sell securities likely just at the wrong time; i.e. when the market is down.

Don't let this happen to you.

Find other enlightening terms in Shmoop Finance Genius Bar(f)