Question

What does buying stock on margin mean?

Answer 1

find the stock of the marginal means marginal miles is is the limit in society

Answer 2

Answer:

Well,I'll explain it to you in simple terms instead of going to technical side.

Suppose,you buy a mobile phone of Rs 20000 by making a down payment of RS.10000 and rest you financed.

Same thing happens in buying a stock on margin.

You contact your broker and ask him about his margin and he says it's 40%.

This margin of 40% is the minimum amount of the total transaction that you need to pay to your broker and rest 60% he will be paying on your behalf for some percent of commison.

This strategy is used in two cases:-

1.You don't have enough money to buy the share.

2.To maximise your returns.