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margin account

 

Definitions from WordNet

Noun margin account has 1 sense
  1. margin account - an account with a securities brokerage in which the broker extends credit
    --1 is a kind of
    brokerage account
    Antonyms: cash account

Definitions from the Web

Margin Account

Description:

A margin account is a type of brokerage account where an investor can borrow funds from a broker to purchase securities. This allows investors to leverage their buying power and potentially increase their investment gains.

Senses:

  1. Financial Sense: A margin account is a financial account that allows investors to borrow money to trade securities.

Usages:

  1. Buying on Margin: With a margin account, investors can buy stocks, bonds, or other securities by borrowing money from a broker.
  2. Leveraging Investments: Margin accounts provide the flexibility to leverage investments by using borrowed funds alongside the investor's own deposited funds.
  3. Margin Call: In a margin account, when the value of the investor's account falls below a certain level, the broker may issue a margin call, demanding additional funds to cover potential losses.
  4. Short Selling: Margin accounts are commonly used for short selling, where investors borrow shares from a broker, sell them on the market, and aim to buy them back at a lower price later to make a profit.

Example Sentences:

  • Financial Sense: In stock trading, utilizing a margin account allows investors to increase their potential returns.
  • Buying on Margin: Sarah purchased 100 shares of a tech company using her margin account, leveraging her buying power.
  • Leveraging Investments: James decided to invest in a diverse portfolio using his margin account, allowing him to increase his exposure to various asset classes.
  • Margin Call: When the stock market crashed, Mark received a margin call requesting him to deposit additional funds into his account.
  • Short Selling: Rebecca borrowed shares of a popular cryptocurrency through her margin account and sold them, expecting their price to drop in the near future.

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