What is Regulation T primarily concerned with?

Regulation T primarily focuses on the extension of credit by brokers and dealers to their customers in securities transactions. It sets the rules regarding how much credit can be extended, the requirements for maintaining margin accounts, and the overall limits on the amount of money that can be borrowed against the value of securities. Regulation T plays a vital role in overseeing how brokers facilitate transactions and ensures that there is a fair and orderly market by preventing excessive borrowing that could lead to increased risk in securities trading.

This regulation is essential for maintaining the stability of the financial markets and protecting investors by promoting responsible lending practices. It addresses the conditions under which credit can be extended and ensures that the use of margin does not create excessive risk for both the investors and the financial institutions involved.