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    ll and XYZ moves higher, you can sell with a very nice profit.

    But what if the market is in the process of correcting? Old XYZ co

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    Margin–borrowing from your broker--increases your buying power, and when all is right with the world it literally doubles profit potential. But if you make a lousy play you have to pay back double. That’s why we have preached for years against using margin. There’s already enough risk in the market.

    Let’s suppose you like stock XYZ at 50 but don’t have the cash in your account to buy all that you want. So you decide to “margin” it, which simply means you borrow 50% of the money to buy XYZ from your brokerage. If the trade goes well and XYZ moves higher, you can sell with a very nice profit.

    But what if the market is in the process of correcting? Old XYZ cou

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    ial. But if you make a lousy play you have to pay back double. That’s why we have preached for years against using margin. There’s already enough risk in the market.

    Let’s suppose you like stock XYZ at 50 but don’t have the cash in your account to buy all that you want. So you decide to “margin” it, which simply means you borrow 50% of the money to buy XYZ from your brokerage. If the trade goes well and XYZ moves higher, you can sell with a very nice profit.

    But what if the market is in the process of correcting? Old XYZ co

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    ady enough risk in the market.

    Let’s suppose you like stock XYZ at 50 but don’t have the cash in your account to buy all that you want. So you decide to “margin” it, which simply means you borrow 50% of the money to buy XYZ from your brokerage. If the trade goes well and XYZ moves higher, you can sell with a very nice profit.

    But what if the market is in the process of correcting? Old XYZ co

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    want. So you decide to “margin” it, which simply means you borrow 50% of the money to buy XYZ from your brokerage. If the trade goes well and XYZ moves higher, you can sell with a very nice profit.

    But what if the market is in the process of correcting? Old XYZ co

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    ll and XYZ moves higher, you can sell with a very nice profit.

    But what if the market is in the process of correcting? Old XYZ could take a 10-15-point loss, and there is a good chance that eventually the brokerage will call you for the balance. Well, if you had to borrow the money to buy XYZ in the first place, where are you going to get the money to pay back the broker? We know that sometimes margin calls go out, and the customer simply doesn’t have the money to pay. That is an ugly situation that can result in liquidating positions, closing accounts and facing lawsuits.

    It’s a different situation with short sales. Brokers insist that you have a margin po

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