InsiderFlow › Glossary › What is margin (in trading)?
Margin is the capital your broker requires as collateral for leveraged positions: your skin in the game.
To control $10,000 of stock at 10x leverage, the broker asks for $1,000 of initial margin. While the position is open, a maintenance margin must also remain: if losses eat into it, the margin call arrives.
If you don't top up, the broker liquidates your positions automatically, often at the worst moments. Cascading forced liquidations are one of the mechanisms that accelerate market crashes.
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The broker's demand to deposit more capital to cover losses, on pain of forced position closure.
No: buying stocks or ETFs without leverage, margin doesn't exist. It's a concept of derivatives and securities lending.