The margin requirement for an uncovered call is the greatest of the following calculations times the number of contracts times the multiplier (usually 100):
- 20% of the underlying price minus the out of the money amount plus the option premium
- 10% of the underlying price plus the option premium
The premium received from the sale of the short call may be applied to meet the initial margin requirement.
Sell to open 1 MAR 68 call at $1.50 with the underlying stock at $65:
- [((.2 x 65) - 3) + 1.50] x 1 x 100 = $1,150
- [(.1 x 65) + 1.50] x 1 x 100 = $800
- $2.50 x 1 * 100 = $250
The requirement for this position would be $1,150. The $150 of proceeds generated from the sale can be applied to the margin requirement, the buying power required for this trade would be $1,000.
Please note that some underlyings may have elevated margin requirements. For example, naked options in cash-settled indices use 25%/15% instead of 20%/10%.