Final answer:
Maintenance requirements for margin accounts are set by individual brokerage firms, although the overall regulatory framework is established by the SEC and FINRA.
Step-by-step explanation:
The maintenance requirements for margin accounts are set by individual brokerage firms. These firms establish the minimum amount of equity that must be maintained in a margin account after a trade is executed. The maintenance requirement, which is generally higher than the federal requirement, is designed to protect the brokerage from credit risk associated with lending funds or securities to clients for margin trading.
While the Federal Reserve establishes initial margin requirements through Regulation T, the maintenance margin requirement, which applies after the purchase of securities, is set by the brokerage firms themselves. However, organizations such as the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA) do oversee and regulate the brokerage industry to ensure compliance with federal laws and protect investors.
Essentially, the SEC and FINRA regulate and supervise the sale of securities, and while they set the overall regulatory framework in which brokerage firms operate, the specific maintenance requirements within that framework are determined by the individual brokerage firms.