What is the maximum amount of money and goods that can be borrowed?

1. Long Margin

1.1 Leverage

Leverage varies from security to security. The maximum leverage is 2.27 times (1 / 44% = 2.27) when a stock has a minimum initial margin ratio of 44%.

In other words, a customer with cash of 10,000 HKD in his account can buy stocks valued at HKD 22,700, where 10,000 HKD is his own capital. Of which HKD10,000 is own funds and HKD12,700 is the margin amount.

1.2 Maximum amount of money that can be borrowed

In general,  Futu will calculate the buying power of financing and securities financing based on the net asset value of your account. However, according to Futu's own risk control guidelines, we will take into account client account assets, risk status, and other relevant factors to allocate the maximum credit limit (i.e. the maximum amount that can be borrowed) for every client separately and may adjust the credit limit dynamically according to company's decisionor market conditions.

Example: Customer A and B have a maximum credit limit of 1 million, and customer A holds 1 million shares of a certain stock (suppose that the customer can use the 2x leverage), the customer B can use margin to buy another million shares of the above stock. Assuming Customer B holds 3 million of a certain stock, the customer can use margin to buy more 1 million of the above stock (because every customer's credit limit is 1 million).


2. Sell Shorting

2.1 Leverage

Suppose that the initial margin ratio of a stock is at least 60%, the maximum leverage is 1.67 times (1 / 60% = 1.67).

In other words, if a customer's account has 10,000 HKD in cash, he/she can borrow stocks values at 16,700 HKD for short selling.

2.2 Maximum amount of goods that can be borrowed

If the pool of securities available for lending is sufficient, the maximum leverage of a stock is 1.67. If there is insufficient securities which can be borrowed, the number of shares that can be borrowed will be even less.