Benefits of Margin
Margin lending acts as your flexible line of credit, secured against existing investments and is generally more cost-effective than many other consumer lending options. If you are considering the use of margin, you must fully understand the risks associated with using a margin account.
Margin allows you to use the securities in your brokerage account as collateral to borrow funds quickly, at favorable low margin rates, without having to liquidate within your portfolio. You can utilize your collateral as leverage to make additional investments in securities, sell securities short or access a convenient line of credit to raise cash for other purposes. Margin is not available for all account types such as IRAs and custodial accounts.
Consider borrowing on margin if you:
- Have a substantial and diversified portfolio and secure disposable income
- Are a disciplined investor and are willing to bear greater risk in return for greater return
- Understand that borrowing on margin can multiply losses as well as gains
- Want to save substantial interest expense while gaining access to funds
- Understand the Margin Guidelines and Margin Risks
Other benefits of margin:
 If the securities in your account decline in value, so does the value of the collateral supporting your loan, which could result in a margin call and/or selling securities in your account(s). It is important that you fully understand the risks involved in trading securities on margin. Click here for the risks involved with trading securities in a margin account.