Buying On: Margin Quizlet

: The stocks purchased on margin serve as collateral for the broker's loan. Benefits and Risks What did "buying on margin" mean in the 1920s? - Quizlet

Buying on margin is the practice of purchasing stocks by paying a small percentage of the price (a down payment) and borrowing the remaining balance from a broker. This strategy uses to increase buying power, allowing investors to control more shares than they could with cash alone. Key Concepts and Terminology buying on margin quizlet

: A notification from a broker that the account value has fallen below the maintenance margin. Investors must then deposit more cash or sell assets to cover the shortfall. : The stocks purchased on margin serve as

: The portion of the securities' value that the investor actually owns (Total Market Value - Loan Balance). This strategy uses to increase buying power, allowing

: The minimum percentage of the total purchase price an investor must pay in cash. Currently, the Federal Reserve's Regulation T generally requires an initial margin of 50% .

: The minimum amount of equity an investor must maintain in their margin account after the purchase.