Uncovered Options Trading System
When an investor borrows money from a brokerage house to cover part of the purchase of a security, an investor is borrowing on margin.
The maximum percentage of the investment that can be loaned by the brokerage firm, is the margin requirement set by the Federal Reserve Board.
The uncovered options margin requirement is the amount that an uncovered options writer must keep on deposit in his account to cover the naked option position. Based on current prices, the margin requirement is updated daily.
Naked options trading is very risky - many people lose money trading them. It is recommended contacting your broker or investment professional to find out about trading risk and margin requirements before getting involved into trading uncovered options.