'

Regulation T/Regulation U (U.S)

Two Federal Board regulations controlling respectively, the amount of credit a broker or a bank can extend to a client to buy securities. During recent years, under Regulation T (applying to Brokers), the Federal Reserve Board has set margin requirements on most stock at 50 per cent, meaning that the broker can lend a client no more than 50 per cent of the stocks he wishes to purchase. Regulation U applies in similar manner to banks.

Advertisement

Comments