Expert: Tad Borek - 8/15/2009

Question
Can you buy stock on margin when dealing with a private stockbroker?

Answer
Frankie, I'm not sure what you mean by a "private stockbroker" (are you from outside the US?).

In the US, buying stock on margin requires a margin account through a brokerage firm. The amount you can borrow is limited by the amount of cash and securities (collateral) you deposit. The details about how that works are set by some very detailed rules about margin lending, as well as by the firm's own policies. There's a lot to learn and it introduces significant risks - which is why most people don't use margin at all.

-Tad