Key Topics
- Max Margin Utilization replaces DTA as the governing cap; DTA becomes an OUTPUT.
- Maintenance requirement is the #1 driver of your margin line size + drop-cushion.
- IMR (weighted portfolio maintenance) — want 20–30%. Margin Health Analyzer tool (6 color cards).
- Each broker names "maintenance requirement" differently (reference PDF built w/ Matt McFarland).
- The Margin Advantage = shift debt from expensive external line to cheaper margin (chase spread, keep external line open).
- Multiplier model: 1÷(1−DTA) grows your controllable base independent of ETF returns.
Key Numbers
- Max margin utilization 60% (50% in uncertain market); 40–60% "optimal" band. Good maintenance 25/30/35%; bad 75/100%. IMR target 20–30%.
- 3-person example ($100k assets, all target 40% DTA): lines $30k/$60k/$40k — bad-maintenance ones margin-called.
- Worked tool run: portfolio $200k → $100k margin → 60% cap $60k; DTA out 48% vs 12% actual, DSCR 25, IMR 20%, util 15%.
- Rates cited: M1 ~4.8%, Schwab 12%→10%→neg. 9%, HELOC 7% (prime), whole-life 5.53%. Multiplier: DTA40%=1.667, 30%=1.43.
- Growth ex: ($2k/mo + $20k/mo cash flow)×12×1.5 = ~$396k/yr base; scaled = ~$540k/yr. Buy-borrow-die saves ~25% cap-gains.
This transcript is actually Part 2 of the series.
Materials open in Google Drive (academy login may be required).