432 THE WORK OF THE STOCK EXCHANGE 
them by methods already outlined, are erased and changed as 
the fluctuations in market prices or other factors necessitate. 
Margin in Points and Percentage.—Margin is often com- 
puted in points—that is, in the number of dollars per share 
which stock prices would have to decline before the margin 
became exhausted. Since Blank’s margin on his 390 long 
shares is $16,550.91, it amounts in even figures to $42 or 42 
points on every single share of the long stock. In other words, 
every one of the 390 long shares would have to decline on the 
average 42 points (or $42 per share) before Blank’s margin 
would be exhausted. 
Margin may also be figured in percentages. Thus in Figure 
57 Blank’s margin is stated to be 44%, because his equity of 
$16,550.91 bears that proportion to the total value of his long 
stock, $37,600. In very high- or very low-priced stocks, the 
percentage of the customer’s margin is especially important. 
If, for example, a customer happened to hold shares whose 
price stood at about $600 or $700 apiece, a 50-point margin 
would be insufficient and a 20-point margin might be perilous. 
On the other hand, if the customers’ shares were low-priced 
stocks, selling—Ilet us say—at $5 apiece, even a 10-point margin 
would be impossible, and a 3-point margin perhaps conserva- 
tive. In such cases the pgrcentage relation of the amount of 
the margin to the value of the shares would have to be reckoned. 
A customer might have a 5o-point margin on a $500 stock, 
and have only a 10% margin, and yet his margin on $5 stock 
would be 40% if it were 2 points. Thus it can be seen that the 
number of points of margin demanded by the broker varies 
with each individual case, and cannot be set at any one limited 
figure, either by law or by regulations of the Stock Exchange 
itself. It would be equally impractical to attempt to establish 
a fixed percentage between the margin and the value of the 
securities of which the customer is long or short. It is sig-