What Does Buying Stock On Margin Mean at Buying

What Does Buying Stock On Margin Mean. Margin is borrowing money from your broker to buy a stock and using your investment as collateral. But margin exposes investors to the potential for higher losses.

Buying on margin is the purchase of a stock or another security with money that you’ve borrowed from your broker. 100% of the minimum 20% margin required on trade value for stocks in the cash segment or span +exposure in the derivative segment. Buying stock on margin is only profitable if your stocks go up enough to pay back the loan with interest.

Going Concern Value vs. Liquidation Value Pocketsense

What does buying stocks on margin mean? Rest 20% of the sell amount: Your stockbroker may use it at some point, so it is better you know the meaning of buying stock on margin as you progress as a trader. Trading on margin means borrowing money from a brokerage firm in order to carry out trades.