Definition: Margin buying is buying securities/stocks with money borrowed from a broker. Since this money is borrowed, margin buying can multiply profits or losses made on the securities. The stocks/securities are used as collateral for the loan.

Explation: The broker will have a set minimum margin requirement which is the maximum percent of the investment that can be paid for with margin/borrowed money.  A Margin Call is when the value of your investment drops your equity in the investment below the requirements of the broker at which time you have to add more money to your account or sell the security.

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