Dictionary of Finance and Investment Terms: Adjusted Debit Balance (ADB)
Adjusted Debit Balance (ADB)
formula for determining the position of a margin account, as required under Regulation T of the Federal Reserve Board. The ADB is calculated by netting the balance owing the broker with any balance in the Special Miscellaneous Account (SMA), and any paper profits on short accounts. Although changes made in Regulation T in 1982 diminished the significance of ADBs, the formula is still useful in determining whether withdrawals of cash or securities are permissible based on SMA entries.
