Loan To Value (LTV)

What is Loan To Value?

Loan to value (LTV) is the percentage of a stock's value you can borrow against in a Reg T account.

Example

If you own $10,000 worth of ABC stock with an LTV of 70%, you can borrow a maximum of $7,000 against it.
If you own $10,000 worth of ABC stock with an LTV of 50%, you can borrow a maximum of $5,000 against it.
If you own $10,000 worth of ABC stock with an LTV of 0%, you can't borrow against it.

Blended LTV

Blended LTV is the weighted average LTV of all the stocks in your portfolio. In the example below, the blended LTV is 56%.

Symbol	Stock Value	LTV	Max Borrow
ABC	$ 15,000.00	70%	$ 10,500.00
DEF	$ 10,000.00	50%	$ 5,000.00
XYZ	$ 5,000.00	25%	$ 1,250.00
Total	$ 30,000.00	56%	$ 16,750.00

Concentration LTVs haven't been applied in this example. Learn more about concentration requirements.

Blended LTV and LTV include direct indices and self-managed positions in a Reg T account. Assets held in cash, Treasury, long short direct indices, or a portfolio margin account aren't included.

LTV and maintenance Requirements

We prefer to show you how much you can borrow against a position, rather than how much you can't, which is why we use LTV instead of maintenance requirements.

Maintenance requirement is an industry term describing the minimum amount of equity that must remain in an account. It's commonly presented as a percentage. For example, if stock ABC has a maintenance requirement of 25%, that means 25% of the value of your ABC position must remain as equity and can't be borrowed against.

LTV represents the percentage of value you can borrow, while maintenance requirement represents the percentage you can't. So: 100% − LTV = maintenance requirement %.

For example, if you own $10,000 worth of ABC stock with an LTV of 75% and a maintenance requirement of 25%, you can borrow a maximum of $7,500 against it and must maintain $2,500 as equity in your account.

The same relationship holds between blended LTV and blended maintenance requirements.