Margin Account

What Does Margin Account Mean?
A brokerage account in which the broker lends the customer cash to purchase securities. The loan in the account is collateralized by the securities and cash. If the value of the stock drops sufficiently, the account holder will be required to deposit more cash or sell a portion of the stock.

Investopedia explains Margin Account
In a margin account, you are investing with your broker's money. By using leverage in such a way, you magnify both gains and losses.

Related Terms

Broker's Call
Buying Power
Cash Account
Current Market Value - CMV
House Maintenance Requirement
Initial Margin
Leverage
Maintenance Margin
Margin Call
Remargining
More Related Terms

Related Links

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