# How to use margin and maintain mm

Hi all,

I have a puzzle it is when i’m having a total of 50,000 starting capital in my model account. If i use margin x2 that will be 100,000 so each position will be 10,000? i.e. 0.10 of 100,000 but that will be a 0.20 of my base capital. So is it correct to just have 5,000 positions x 20?

Cheers,

San

I’m afraid I do not understand what you are asking. Perhaps you can rephrase the question with a bit more specific information. Then I’ll try my best to answer.

Here’s a better explanation: my system Spectrum-Blue Eyes has 50,000 cash and i want to use in a single trade only 10% of 50,000 but I want to use margin of C2 which is x2. How do I only use 10% in a position and still use up 2x50,000 = 100,000? Do I have 20 times 5,000 which is 10% of the 50,000 to use margin and still keep my position sizing to use only 10%. I am thinking if i use 10% times 2 it would be 20% and that is too much for this system.

Cheers, San

San:

If you have \$50,000 in cash in your C2 Model Account, then for stocks over \$5 dollars, you are allowed to buy \$100,000 worth of such stocks in total. How you divide up your pie, and at what leverage, is your decision. If you want to lever up and use all available margin, and you want to hold ten stocks at equal proportions, then you would invest \$10,000 per stock (50,000 x 2 / 10). Of course this would leave you no room for drawdown/losses, so you will probably want to factor in a cash cushion of some amount.

Matthew

Ok thanks Matthew.