THE ROARING 20S 1920 1929
1920S AMERICAN CULTURE
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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buying more than you need
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borrowing money to buy stocks
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buying goods, like cars, on credit
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refusing to buy goods
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Detailed explanation-1: -Buying on margin involves getting a loan from your brokerage and using the money from the loan to invest in more securities than you can buy with your available cash. Through margin buying, investors can amplify their returns-but only if their investments outperform the cost of the loan itself.
Detailed explanation-2: -Trading on margin means borrowing money from a brokerage firm in order to carry out trades. When trading on margin, investors first deposit cash that then serves as collateral for the loan and then pay ongoing interest payments on the money they borrow.
Detailed explanation-3: -"Margin” is borrowing money from your broker to buy a stock and using your investment as collateral. Investors generally use margin to increase their purchasing power so that they can own more stock without fully paying for it.
Detailed explanation-4: -Margin trading is a facility under which you buy stocks that you can’t afford. You are allowed to buy stocks by paying a marginal amount of the actual value. This margin is paid either in cash or in shares as security.
Detailed explanation-5: -FINANCE Margin trading means buying stocks with borrowed funds-it’s riskier than paying cash, but the returns can be greater. FINANCE Understanding margin calls and 4 ways to avoid owing money to your brokerage firm.