USA HISTORY

Detailed explanation-1: -A margin account provides you the resources to buy more quantities of a stock than you can afford at any point of time. For this purpose, the broker would lend the money to buy shares and keep them as collateral.

Detailed explanation-2: -An investor with a margin account can usually borrow up to 50% of the total purchase price of marginable investments. The percentage amount may vary between different investments and brokers. Each brokerage firm has the right to define which investments among stocks, bonds, or mutual funds can be purchased on margin.

Detailed explanation-3: -Simply put, borrowing on margin means taking an interest bearing loan secured by securities you own in your brokerage account (the securities are pledged as collateral for the loan).

Detailed explanation-4: -"To margin” or “buying on margin” means to use money borrowed from a broker to purchase securities. You must have a margin account to do so, rather than a standard brokerage account.

Detailed explanation-5: -Buying on margin occurs when an investor buys an asset by borrowing the balance from a bank or broker. Buying on margin refers to the initial payment made to the broker for the asset-for example, 10% down and 90% financed. The investor uses the marginable securities in their broker account as collateral.