Margin buying - Finance Records
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Topic: Margin buying


  
 Investor Tips: Margin - Borrowing Money To Pay for Stocks
"Margin" is borrowing money from your broker to buy a stock and using your investment as collateral.
Margin accounts can be very risky and they are not suitable for everyone.
Under most margin agreements, even if your firm offers to give you time to increase the equity in your account, it can sell your securities without waiting for you to meet the margin call.
http://www.sec.gov/investor/pubs/margin.htm

  
 USATODAY.com - Risky buying on margin surges again
Margin is using borrowed money to buy stocks and using other stock as collateral on the loan.
The last time margin balances at NASD brokers topped $20 billion was March 2000 — just as the market was about to head into a brutal three-year slide.
He says he'd be more worried if margin debt wasn't increasing as stocks rallied; that would show a lack of conviction.
http://usatoday.printthis.clickability.com/pt/cpt?action=cpt&expire=&urlID=7657514&fb=Y&partnerID=1661

  
 Invest FAQ:Strategy:Buying on Margin
Always have cash reserves outside of your brokerage account that exceed your margin debt, so that you could pay off the debt at any time, if necessary.
Do not use margin debt as a long-term investment strategy.
At no time did my margin debt exceed 25% of my net account equity.
http://invest-faq.com/articles/strat-margin.html

  
 Great Depression - Wikipedia, the free encyclopedia
Business inventories were three times as large as they had been a year before (an indication that the public was not buying products as rapidly as in the past); and other indicators of economic health—freight carloads, industrial production, wholesale prices—were slipping downward.
An increase in margin buying, the act of borrowing money from lenders in order to buy stocks, helped many people invest in the roaring stock market of the 1920s.
By the end of the 1920s, however, capital investments had created more plant space than could be profitably used, and factories were producing more goods than consumers could purchase.
http://en.wikipedia.org/wiki/Great_Depression

  
 Buying on Margin
Buying on margin is usually simple, but it is risky.
Margin accounts are not just used for buying -- you can also use them to sell securities.
Buying on margin is a strategy for the short term, since holding on to borrowed money too long could result in a loss.
http://www.ameritrade.com/educationv2/fhtml/learning/buyonmargin.fhtml

  
 Encyclopedia4U - Stock market - Encyclopedia Article
Other rules include a prohibition of freeriding, that is, putting in an order to buy stocks without paying intially, and then selling them and using part of the proceeds to make the original payment.
Most industralized countries have requlations which require that if the borrowing is based on collateral from other stocks, then it can be at only a certain percentage of those other stocks value.
But if the stock price does fall, he can buy the stock at a low price on the market and then sell it for agreed-upon higher price.
http://www.encyclopedia4u.com/s/stock-market-1.html

  
 Frequently Asked Questions: Margin / Buying Power
Buying power is the amount of marginable securities you may purchase without adding additional equity to your margin account.
Margin accounts can be transferred as long as the account is in good standing and has equity of at least 50% of market value.
Your order is automatically executed on margin and your account is debited for a $5,000 margin loan.
http://www.fireflytrading.com/ns/FAQ_Margin.htm

  
 Fool.com: Fool FAQ - Margin
This, of course, is the result of the change in the share prices of the marginable securities in your account.
When you buy on margin, you're simply borrowing money from your broker to buy stock.
One aspect of buying on margin that you must remember is that the buying power of your account can change daily.
http://www.fool.com/FoolFAQ/FoolFAQ0025.htm

  
 Margin Buying as supplied by EagleTraders.com
Special miscellaneous accounts may be credited with the excess over margin requirements in a margin account occurring by reason of a rise in market value (which must be withdrawn on the same day it occurs) or dividends (which must be withdrawn in 35 days).
The purpose of buying on margin is to increase the possibility of gain with available cash.
The customer under New York Stock Exchange rule may not be permitted by a member firm to make a practice of effecting transactions requiring initial or additional margin and then furnishing such margin by liquidation of the same securities or other securities.
http://www.eagletraders.com/advice/securities/margin_buying.htm

  
 Investor alert: Buying on margin - PittsburghLIVE.com
Monitor the price of the securities in your margin account on a daily basis.
That’s because when the securities in your margin account decline in value, the value of the collateral supporting your loan declines as well.
Here’s how it works: when investors buy on margin, they borrow part of the purchase price of a stock from their brokerage firm.
http://www.pittsburghlive.com/x/tribune-review/business/s_158236.html

  
 The Investment FAQ (part 17 of 20)
The primary uses are to buy securities (called "buying on margin") or to extract cash from an equity position without having to sell it (thus avoiding the tax bite or the chance of missing a run-up).
Note that if you have a cash account with the same broker, securities held in the cash account (often non-marginable securities) do not help (nor can the broker sell them) if you have a debit balance in the margin account.
The agreement says that the broker can use as collateral any securities held in the margin account whenever you have a debit balance (i.e., you owe the broker money).
http://www.faqs.org/faqs/investment-faq/general/part17/

  
 Shorting Stocks; shorting, margin, buying power, shorting, stocks, selling short, short selling, online, stock market
You now buy 100 shares of XYZ at $85 and pay your broker back the 100 shares of XYZ.
You can protect yourself against a loss if the price declines and also to take profits when the stock rises.
You borrowed the stock at 110 and paid it back at 85.
http://www.shortingstocksonline.com/definition.htm

  
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 Margin buying
Please See Great Depression For Further Information about Margin buying.
http://www.bambooweb.com/articles/m/a/Margin_buying.html

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