Series 53: Margin Accounts: Hypothecation

Taken from our Series 53 Online Guide

Margin Accounts: Hypothecation

Investors are allowed to purchase securities on margin if they open a margin account. Buying securities on margin means to purchase them with credit. The investor pays for part of the price of the security and the broker-dealer loans the investor funds for the rest. The loans must be secured by the customer with money or securities and placed in a margin account held by the broker-dealer (the len

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