Twin Edge Sword for Investment
Hi guys,
It's good to invest money in Securities. Those who feel it dark pit are right but, till the point u don't see it in the light of fact that, u get credit from broker for trading with high cash in your kitty. To make it simple, U have 10,000 INR or USD ( in any form either cash in bank cheque or securities for mortgage), RISK MANAGEMENT of Brokeing house calculates LEVERAGE AMOUNT (like Overdraft Limit on your acount) which can be used for trading.
Sounds good to all fast trackers but, it's mean edge is also gives u suffering like CREDIT CARD WOES. U use more and win or lose more. It's exciting but, also sad for novice investors.
What:
A margin account is an account offered by brokerages that allows investors to borrow money to buy securities. In a simplified example, an investor might put down 50% of the value of a purchase and borrow the rest from the broker. For the right to borrow money, the broker charges the investor interest and uses the securities as collateral.
How it Avalances:
The important thing to understand about margin is its consequences. Margin is leverage, which means that both your gains and losses are amplified. Margin is great when your investments are going up in value, but the double-edged sword of leverage really hurts when your portfolio heads south.
Because margin exposes you to extra risks, it's not advisable for beginners to use it.
Margin can be a useful tool for experienced investors, but until you get to that point, play it safe.
2 Comments:
we_d_living, I just happened to be surfing for emini futures and somehow I ended up here. Don't ask me how. I actually wasn't interested in Twin Edge Sword for Investment until I accidently got here and started reading. Got major sidetracked. - ROFL - Well, best of luck and I'm back off looking for info on emini futures.
Hi there we_d_living. I was searching for the latest information on emini futures and somehow, which I don't understand, found your site. Although Twin Edge Sword for Investment wasn't what I was interested in, I'm sure glad I found it. It's really amazing how on the Internet you can sit down and look for one thing, such as emini futures and find totally unrelated interesting stuff and spend hours reading about stuff other than what you were searching for. I'll keep on looking for emini futures but I just had to comment on how much I enjoyed reading the comments here.
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