Available Funds is an important metric in a margin account that represents the amount available to open new positions. At Interactive Brokers, we calculate Available Funds using the following formula:
Available Funds = Equity with Loan Value (ELV) - Total Initial Margin Requirements
To break this down further:
- Equity with Loan Value (ELV): This is the current market value of your securities, plus any cash balance in your account, and the value of any open option positions.
- Total Initial Margin Requirements: This is the sum of the Initial margin requirements for all your current positions.
It's important to note a few key points about Available Funds:
- Only funds in the Securities segment of your account are included in the Available Funds calculation used for securities Buying Power.
- Available Funds is used to calculate your securities Buying Power.
- The calculation takes into account your account's equity and the Initial Margin Requirements for your current positions.
In the Account Window, you may notice a "Previous Day's ELV" value. This is a snapshot of your account's Securities segment's marginable Equity with Loan Value taken at 16:15 EST the prior trading day. This information can be useful for tracking changes in your account value over time.