Margin and Leveraged Trading

Margin and leveraged trading uses borrowed funds, collateral, or performance bonds to support market exposure. Leverage can magnify gains and losses, while financing cost, changing requirements, and liquidation rights can determine whether a position remains open.

Use Margin for the broad distinction between securities credit and futures performance collateral. Use Margin Account for buying on margin, broker loans, margin debt, buying power, interest, and security eligibility.

Margin Call explains initial and maintenance requirements, deficiency calculations, and forced liquidation. Borrow Fee covers the separate cost and availability risks of borrowing securities for a short sale.

Core Concepts

Evidence to Check

• Account and product type, position direction, quantity, market value, and settlement status.
• Margin agreement, regulatory or exchange rule, and current broker or clearing requirement.
• Debit, equity, collateral value, concentration charge, buying power, and open commitments.
• Interest rate, borrow fee, distribution obligations, and transaction costs.
• Margin notices, liquidation rights, transfer timing, and stressed-market liquidity.

Margin content is educational and does not recommend leverage, short selling, borrowing, or a response to a live account deficiency.

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