™Borrowing $5,000 to combine with $5,000 equity creates a $10,000 purchase; a $1,000 position loss is 20% of the initial equity before interest.
Trading
Margin
Borrowed purchasing power or collateral required to support certain positions.
Plain-English context
Put the definition to work.
A stock-margin loan differs from futures performance-bond collateral; neither creates risk-free additional capital.
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