Stock investments often seem daunting to people. That’s why they prefer the option of stock-broking. Stock-broking allows them to buy or sell financial securities like shares, stocks and bonds with the help of a middleman (the stockbroker), in the stock market. The stockbroker acts as an agent on behalf of the client that is wishing to buy or sell the aforementioned securities.

Margin trading in the stock market refers to the scenario in which you can more stocks than your budget allows. Which means, for instance, let’s say a stock’s value is X=A+B, where A and B are different stock prices. And suppose you only have B amount. Margin trading allows you to buy X by lending you an amount.

The process of attaining the benefits of marginal trading involves opening a margin account first. And more importantly, there’s a certain amount that you must pay to your broker upfront, which is called minimum margin.