Why does short-selling treasuries require significant collateral?

External question — Personal Finance Stack Exchange Author: curiousgeorge Original post: https://money.stackexchange.com/questions/131358 License: CC BY-SA 4.0 — https://creativecommons.org/licenses/by-sa/4.0/ Adaptation: HTML converted to plain text; contact email addresses removed. In the vein of this question, I'm curious about getting a loan by selling treasuries. The issue, apparently, is that the proceeds of the short sale is held as collateral. As I understand it, however, the prices of treasuries have an upper bound (unless negative rates are somehow possible but even so very rare). So there should be far less risk short selling treasuries than stocks especially when the interest rates are low. Is there a reason why the broker still takes the proceeds as collateral and are there methods to short sell treasuries with minimal collateral given the lower risk?

External answer — Personal Finance Stack Exchange Author: Bob Baerker Original post: https://money.stackexchange.com/a/131360 License: CC BY-SA 4.0 — https://creativecommons.org/licenses/by-sa/4.0/ Adaptation: HTML converted to plain text; contact email addresses removed. The margin requirement for treasuries is much lower than for options and equities. However, your broker has the right to require a higher amount. I trade at with a broker that has the lowest margin requirement (the Reg T minimum), one of the lowest margin loan rates and offers portfolio margin (lower than Reg T). Last week, they raised the margin requirement based on their expectation of possible higher market volatility going into the election. Check with your broker.