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| Invest FAQ:Trading:Brokerage Account Types |
articles ..index ..previous ..next ..full text browse ..the bookshelf join ..the email list surf ..invest links tour ..for beginners ..for investors ..for traders about ..what is it? ..what's new?tially granting you credit by giving you a margin account, you must pass their screening procedure to get one. even if you don't plan to buy on margin, note that all short sales ("type 5") have tobroker can use as collateral any securities held in the margin account whenever you have a debit balance (i.e., you owe the broker money). note that if you have a cash account with the same broker,u can use a margin loan for anything you want. 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 equity to debt ratio, which further protects your broker. if you fall below the requirements, you will have to deposit cash or securities and/or liquidate securities to get back to required levels. of marginable securities. this number has been as low as 40% and as high as 100% (thus preventing buying on margin). what this means is that your equity has to be at least 50% of the value of theneed to solve e/(mv-l) >= imr for l. using ed [which we previously defined as (imr*mv - e)], the answers are: c = ed s = ed/(1-imr) l = ed/imr if ed is negative (you have more equity than is
http://invest-faq.com/articles/trade-broker-accts.html - 25k
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http://invest-faq.com/articles/trade-broker-accts.html
2005-12-04 00:29:08
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