(in the U.S.) a federal law governing the amount of credit that may be advanced by brokers and dealers to customers for the purchase of securities on margin.
A Federal Reserve regulation that specifies the maximum initial credit extension that may be given to investors in securities. The initial margin requirement has varied from 40 to 100% since the regulation was established under provisions of the Securities Exchange Act of 1934. Listed stocks, convertible bonds, and many over-the-counter stocks are covered by Regulation T. See also freeriding 2, frozen account, special miscellaneous account.
Main Entry: Regulation T Pronunciation: -'tE Function: noun : a regulation of the Board of Governors of the Federal Reserve System regulating the extension of credit by and to securities brokers and dealers and imposing initial margin requirements and payment rules on securities transactions
