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Why is that a simple allocation of 100% of portfolio to SPY shows that half of the buying trade uses margin?
For example, with a $100k portfolio and self.SetHoldings("SPY", 1), charting self.Portfolio.MarginRemaining and self.PortfolioMarginUsed shows that the portfolio value is indeed $100k on day 1, but $50k of margin was used to make the purchase. Since there is ample cash, I would expect no margin to be used. Why is half the margin available being used on this trade? Thanks for your help.
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Alexandre Catarino
Hi Patrick ,
The default leverage of the buying power (margin) model is 2. Consequently, when we try to allocate 100% of the portfolio value, only half (1 / leverage → 1 / 2) of the buying power, 50,000 in this case, will be used and the other half will be available.
Bodhi
Thank you for explaining.
Bodhi
The material on this website is provided for informational purposes only and does not constitute an offer to sell, a solicitation to buy, or a recommendation or endorsement for any security or strategy, nor does it constitute an offer to provide investment advisory services by QuantConnect. In addition, the material offers no opinion with respect to the suitability of any security or specific investment. QuantConnect makes no guarantees as to the accuracy or completeness of the views expressed in the website. The views are subject to change, and may have become unreliable for various reasons, including changes in market conditions or economic circumstances. All investments involve risk, including loss of principal. You should consult with an investment professional before making any investment decisions.
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