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Topic: Margin (finance)


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In the News (Sat 19 Dec 09)

  
  No Margin For Error - Investing 101 News Story - KPRC Houston
That means your equity in the margin account (the account's market value less whatever you owe on your loan) must be 30% of the account's current value.
Since that $4,000 is just 28% of the $14,000, you would be subject to a margin call, meaning you have to either liquidate your account to pay off the loan or put up more money to satisfy the margin requirement.
Most margin agreements give brokers the right to sell off a customer's margin account without notice if such a move is necessary to protect the broker's capital.
www.click2houston.com /investing101/8037798/detail.html   (1826 words)

  
  Margin: The Power of Leverage
Moreover, while a stock margin is typically 50% of the value of the purchased assets, a futures margin generally ranges from 5-10% of the contract value.
Maintenance margin is usually less than initial margin, so the amount of cash one needs to carry a position is less than that required to establish the position.
Margin requirements are met by the cash or equity in the trader's account and that equity is eroded if his futures position starts to lose money.
www.mtholyoke.edu /courses/sgabriel/securities1/futures/marginpower.htm   (674 words)

  
 MsMoney.com - Expert Insights - Buying on Margin
There is typically no set time by which the investor must repay the margin loan, but eventually, of course, the investor must reimburse the broker for the funds borrowed and pay interest (based on the broker call rate).
When the margin account is established, the broker informs the investor of the required minimum ratio of marginable securities to securities owned outright.
Because of the inherent risks in margining securities, investors are not permitted to trade on margin in retirement accounts.
www.msmoney.com /mm/expert_insights/buying_margin.htm   (881 words)

  
 Margin Trading
It's the siren song of buying on margin, and while it can be a great way to get a little more return than your cash would normally net you, it also can lead to a quick dunk in some hot water.
Margin accounts allow investors to buy a lot of shares with a relatively small amount of cash up front by using the assets currently held in their accounts as collateral.
Your equity in the account rises and falls as the price of the stock rises and falls but the debit balance remains the same -- except for the accruing interest, which is at an annual rate of anywhere from 8 percent to 10 percent at the moment -- until you repay the debit.
www.bankrate.com /brm/news/investing/20000301n.asp   (719 words)

  
 Used car Finance
We finance all used cars,but, have certain stipulations on the period of financing and the margin amount.
Financing depends on the age of the car and condition of the car that is proposed to be financed.
The reason for this difference is due to the risk taken by the finance co. in financing a car that has poor resale value.
www.automartindia.com /valueadders/Finance/kmuscarfin.htm   (435 words)

  
 The Importance of Gross Margin
If this firm's gross margin as a percent of sales is 50% (which means fifty cents out of each dollar in sales is retained in the company to cover fixed costs), it would need to reach sales of $600,000 to cover its overhead.
A quick analysis revealed that gross margins were inadequate and that pricing was to blame: Though the bakery had higher quality cakes with more expensive ingredients, prices had been set at the level of the competition in fear of losing customers to lower prices.
Some investigation into gross margin revealed the problem: Though her prices and sales figures were in line with her competition, her employees were not being attentive to the cost of materials being put into bouquets.
www.inc.com /resources/startup/articles/20041201/grossmargins.html   (832 words)

  
 M Definitions: Campbell R. Harvey's Hypertextual Finance Glossary
The margin is the difference between the market value of a stock and the loan a broker makes.
The loan in the margin account is collateralized by the stock; if the value of the stock drops sufficiently, the owner will be asked to either put in more cash, or sell a portion of the stock.
Margin rules are federally regulated, but margin requirements and interest may vary among broker/dealers.
www.duke.edu /~charvey/Classes/wpg/bfglosm.htm   (7783 words)

  
 New margin rules proposed - Dec. 10, 1999   (Site not responding. Last check: 2007-11-06)
Margin allows them to leverage their cash balance so they can trade larger blocks of stock without having to put up all the cash.
He said there are a million "hard-core” margin investors with $180 billion in margin debt nationwide, investors who aren’t day traders but use margin to gain significant leverage.
For instance, the margin day-trading rules and the 4:1 buying power extension will not apply to anyone who holds overnight positions, a technique popular with some momentum traders but that most day traders don’t advocate.
money.cnn.com /1999/12/10/investing/margin   (1098 words)

  
 Jordan Securities Commission :: Law And Regulation
The Board may amend the margin finance licensing conditions, and requirements and practice procedures, whereby the Financial Broker licensed to practice Margin Finance shall rectify his position accordingly or liquidate the relevant accounts within the period specified by the Board for this purpose.
The Commission may stipulate use of special forms by the Licensed Financial Broker, or may specify, in part or in whole, the provisions of the agreement or the entries of the accounts, and may impose the addition or omission of provisions or entries, as it deems appropriate.
The Maintenance Margin shall be computed by deducting the value of the facilities offered to the client for the purpose of Margin Finance in addition to the interest thereupon from the total market value of the Margin Financed securities.
www.jsc.gov.jo /regulation_6.asp   (1305 words)

  
 Margin - Wikipedia, the free encyclopedia
In finance, a margin is the cash or collateral that a holder of a position in securities or in exchange traded derivatives is required to post to cover potential adverse movements in the value of the position.
In Medicine, the tissue margins are the edges of an excision (or resection) surgical specimen.
The margins are examined by a pathologist to evaluate the likelihood that the disease (for example, a cancer) has been completely removed.
en.wikipedia.org /wiki/Margin   (474 words)

  
 rediff.com: Banks unlikely to bite margin finance bait: BS
The Reserve Bank of India's move to allow banks to finance margin trading may come to a naught as not many banks are willing to bite the bullet.
The central bank has said the margin financing will be within the overall market exposure limit of banks.
A senior banker with a public sector bank said that margin financing will also be a good line of business as it will earn interest income, which will be at least 300 basis points above the prime lending rate.
www.rediff.com /money/2001/sep/19banks.htm   (434 words)

  
 Gross Margin -- The Overlooked Metric
Gross margin can be stated as gross profit dollars or as a percentage of sales, and it's critical to manage both.
Gross margin is the profit you actually earn when you sell it after any discounting or markdowns; it is frequently called maintained margin.
The small retailers who actively manage their gross margins not only won't be surprised by their quarterly or annual results, they will quickly discover that profitability and cash flow will consistently beat their budget projections.
www.inc.com /resources/retail/articles/200509/hurlbut.html   (1051 words)

  
 Guerrilla Funk: Finance: No Margin For Error
Margin trading isn't gambling, but it can sure seem that way.
At the end of September 2001, for instance, E*Trade was charging 8.0% on a $50,000 margin account.
The key is to remember that margin is a tool -- not a winning lottery ticket.
www.guerrillafunk.com /finance/margintrading.html   (1652 words)

  
 Margin as supplied by EagleTraders.com
Such margins are dollar margins; e.g., where a customer deposits in a brokerage account $1,000 on the purchase of 100 shares of a stock at $25 per share, his dollar margin is $10 per share or ten points.
A further distinction as to margins is the difference between initial margins and maintenance margins.
In addition to assigning a current loan value to margin stock generally, Regulations T and U of the board of governors permit special loan values for convertible bonds and stock acquired through the exercise of subscription rights.
www.eagletraders.com /advice/securities/margin.htm   (451 words)

  
 AmSouth Bank | SEC Margin Disclosure   (Site not responding. Last check: 2007-11-06)
This document is being furnished to you to provide some basic information about purchasing securities on margin, and to alert you to the risks involved with trading securities in a margin account.
Some investors mistakenly believe that a firm must contact them for a margin call to be valid, and that the firm cannot liquidate securities or other assets in their accounts to meet the call unless they are contacted first.
While an extension of time to meet margin requirements may be available under certain conditions, a customer does not have a right to the extension.
www.amsouth.com /ais/margin_disclosure.asp   (773 words)

  
 Margin calls flood in, hurt late market trading - Apr. 4, 2000
But when stocks take a dive and brokers call in this borrowed money, or margin, investors are required to pony up extra money or sell some of their stock to cover the losses.
    "Margin calls tend to precipitate a sell-off, and you've got to figure that part of this action today was due to the initial thrust of the margin calls' feeding the selling," said Vince Farrell, chief investment officer at Spears Benzak Salomon and Farrell.
Meanwhile, shares of brokerage firms including Charles Schwab (SCH: Research, Estimates), the leading online broker, slipped 7-5/16 to 49-5/8 on the day, and E*Trade Group Inc. (EGRP: Research, Estimates) lost 3-1/16 to 24-3/8 amid investor jitters that brokerages could be saddled with losses from investors who fail to repay their loans.
money.cnn.com /2000/04/04/investing/margin   (839 words)

  
 Buying Stock on Margin | Personal Finance > Investing from AllBusiness.com   (Site not responding. Last check: 2007-11-06)
Margin means buying securities, such as stocks, by using funds you borrow from your broker.
If you buy a house at a purchase price of $100,000 and put 10 percent down, your equity (the part you own) is $10,000, and you borrow the remaining $90,000 with a mortgage.
Buying on margin is an example of using leverage to maximize your gain when prices rise.
www.allbusiness.com /personal-finance/investing/10091-1.html   (509 words)

  
 Margin
Margin also subjects the investor to a number of unique risks such as interest payments for use of the borrowed money.
For example, if you hold futures contracts in a margin account, you have to maintain a certain amount of margin depending on how the market value of the contracts change.
Gross profit margin (which is the difference between revenue and expenses) is one measure of a company's performance.
www.investopedia.com /terms/m/margin.asp   (432 words)

  
 Goldman Sachs JBWere: Margin Lending   (Site not responding. Last check: 2007-11-06)
Margin lending is a loan facility secured by a portfolio of shares, managed funds or cash, or a combination of these.
Margin lending gives you more flexibility than traditional geared investment strategies by providing liquidity and the opportunity for you to diversify an existing portfolio and potentially increase the rate of return on your equity.
Before investing using margin lending, please ensure that you understand the impact of gearing on risk and return.
www.gsjbwere.com /products/default.cfm?p=EF_EquityFinance   (369 words)

  
 Morgan Stanley Prime Brokerage Capital Introduction
The margin policies are strategy-specific and are based on a portfolio approach, incorporating all products related to the same investment strategy.
For long/short equity portfolios, the margin requirement (or 'haircut') is generally a single percentage number applied equally to every position.
The margin requirement is therefore a function of the liquidity, volatility and overall diversification of the underlying portfolio, as well as the long/short ratio and/or the amount of hedging through the use of futures and other derivative products.
www.morganstanley.com /euconferences/hedgefunds/ipb/margin_finance.html   (220 words)

  
 Fool.com: Buying Stocks on Margin [Fool's School Daily Tip] March 22, 2002
If you're borrowing on margin and paying 9% interest, you should be pretty confident your stocks will appreciate more than 9%.
When margined securities fall below a certain level, the borrower will receive a "margin call," requiring an infusion of additional cash.
As an example, imagine that you hold $100,000 of stocks and you margin that to the max, borrowing $100,000 to invest in additional stock.
www.fool.com /foolu/askfoolu/2002/askfoolu020322.htm   (402 words)

  
 Schaeffer's Investment Research Margin Trading Tutorial: Introduction
Margin is a high risk strategy that can yield a huge profit if executed correctly.
The dark side of margin is that you can lose your shirt and any other assets you're wearing.
One of the only things riskier than investing on margin is investing on margin without understanding what you're doing.
www.schaeffersresearch.com /schaeffersu/advanced/margin/?click=jumpto   (402 words)

  
 margin Definition
The face value of a loan minus the value of the pledged collateral.
Topics include knowing your current situation, goals and risk tolerance; getting your finances in order; thinking long term and focusing on stocks; researching and monitoring your investments; and knowing when and how to get financial help.
Learn the lingo of "the market," as well as theories about market behavior, such as random walk, behavioral finance theory, and what makes a market efficient.
www.investorwords.com /2944/margin.html   (184 words)

  
 Dubai 2003, margin speculation | Finance and Economy   (Site not responding. Last check: 2007-11-06)
Speculation is rife in banking circles about the margin that the Dubai Government will seek on its imminent Dubai 2003 bonds, according to Gulf News.
The margin is not expected to be as high as the Emirates airline bond's 70 basis points in 2001.
Bankers said the threat of war in Iraq was irrelevant to the credibility of Dubai.
www.ameinfo.com /15411.html   (331 words)

  
 Products and Services - Margin Finance Facility - Introduction
Our MARGIN FINANCE FACILITY is credit facility granted for the purpose of financing the purchase of securities quoted on the BMSB.
The facility allows an investor to leverage on securities deposited and purchased in the Margin Account to increase the level of investment opportunities.
It allows you to utilise 50% of the loan margin granted to you for purchase of securities in your account.
www.affinsecurities.com.my /products_services/margin_finance_facility/main.htm   (125 words)

  
 Leverage (finance) - Wikipedia, the free encyclopedia
The potential for loss is greater because if the investment becomes worthless, not only is that money lost, but the loan still needs to be repaid.
Margin buying is a common way of utilizing the concept of leverage in investing.
An unlevered firm can be seen as an all equity firm, whereas a levered firm is made up of ownership equity and debt.
en.wikipedia.org /wiki/Leverage_(finance)   (519 words)

  
 Steelwedge Budgeting Forecasting Software, Revenue Planning and Margin Trend
This makes it difficult for the finance organization to predict and proactively drive plans to address potential shortfalls in revenue and margins in a timely manner.
In a CFO's wish list, the finance organization should be able to drive pro-forma income statement from an operations plan in real-time and use it to forecast gap between the financial plan and the likely outcome from the operations plan.
Today, the finance organization finds it impossible to quickly evaluate the revenue and margin impact of an ASP or product mix change.
www.steelwedge.com /products/lp_revenue_and_margin_planning.php   (445 words)

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