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Margin Call

In 2008, an investment bank begins laying off a large number of employees, among them Eric Dale, the head of risk management. Dale's attempts to speak about the implications of a model he is working on are ignored. On his way out, he gives Peter Sullivan, an analyst in his department, a flash drive containing his work, warning him to "be careful". Sullivan, intrigued, works after hours to complete Dale's model.

Sullivan discovers that the assumptions underpinning the firm's risk profile are wrong; historical volatility levels in MBSs are being exceeded, so the firm's position in those assets is over-leveraged and the debt incurred from those over-leveraged assets could bankrupt the company. Sullivan calls his colleague, junior analyst Seth Bregman, to return to work with the head of credit trading, Will Emerson. Emerson, in turn, summons Sam Rogers, his boss, after reviewing Sullivan's findings. They are unable to contact Dale because his company phone has been disabled. Sullivan and Bregman go out to find Dale, while Rogers and Emerson inform the company's senior management of the situation.

A meeting of division head Jared Cohen, CRMO Sarah Robertson, and other senior executives concludes that Sullivan's findings are accurate, and CEO John Tuld is called. Upon Tuld's arrival, and after Sullivan explains the problem, Rogers, Cohen, and Tuld spar regarding a course of action: Cohen's plan, favored by Tuld, is a fire sale of the problematic assets. Rogers disagrees, pointing out that the sale will damage the firm's relationships and reputation within the industry and cause major instability in the markets. Tuld stresses that his desire to avoid the firm's bankruptcy is worth that cost.

After the meeting with Tuld, Emerson learns from Dale's wife that he has returned home. Emerson travels to Dale's residence with Bregman and attempts to persuade him to return to the firm, but he refuses. During the drive back, Bregman asks whether he will lose his job; Emerson responds that he likely will but, philosophizing about the nature of financial markets, tells him not to lose faith and that his work is necessary.

Tuld tells Robertson that he will assign the blame to her in front of the traders and the board of directors; Robertson argues that she warned Tuld and Cohen about the situation over a year ago and that both acknowledged the risks, but she fails to persuade Tuld. Meanwhile, Dale is bribed and forced into cooperating with Cohen's plan, with the firm threatening to cut his benefits and severance if he refuses. He spends the day commiserating with Robertson.

Despite his misgivings, Rogers rallies his traders and informs them of the fire sale. He acknowledges the damage likely to be done to their reputations and careers but tells them that they will receive seven-figure bonuses if most of the traders' assigned assets are sold by day's end. As trading progresses, the firm elicits suspicion and, eventually, anger from its counterparties and incurs heavy losses, but it manages to sell off most of the bad assets.

Another round of layoffs begins; upon learning he was spared, Rogers confronts Tuld and submits his resignation. Tuld dismisses Rogers' view of the situation by recalling past economic crises, arguing that such events always happen and that Rogers should not feel guilty for acting in his and the firm's interests. Tuld asks Rogers to stay on for two more years, and Rogers reluctantly accepts, citing his personal financial need. Tuld also informs Rogers that Sullivan will be promoted.