Buying On Margin Quizlet ⭐ Updated

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

: 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% . buying on margin quizlet

: The minimum amount of equity an investor must maintain in their margin account after the purchase. Buying on margin is the practice of purchasing

: 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. Investors must then deposit more cash or sell