what is a margin account 
the term margin account refers to a brokerage account in which a trader s broker dealer lends them cash to purchase stocks or other financial products the margin account and the securities held within it are used as collateral for the loan it comes with a periodic interest rate that the investor must pay to keep it active borrowing money from a broker dealer through a margin account allows investors to increase their purchasing and trading power investing with margin accounts means using leverage which increases the chance of magnifying an investor s profits and losses 