A fuller guide to this term is on the way. In the meantime, the related terms below explain the ideas around it.
Related MoneyPedia terms
- Margin AccountA brokerage account that lets you borrow money to invest, which can boost gains but also magnify losses.
- LeverageUsing borrowed money to increase the size of an investment, raising both potential returns and potential losses.
- Short SellingBetting an investment's price will fall by borrowing shares, selling them, and hoping to rebuy cheaper later.
- BrokerA firm or person that carries out your orders to buy and sell investments, often for a fee or commission.
- VolatilityHow sharply and often an investment's price swings up and down over a given period.
- Cash AccountA brokerage account where you pay in full for investments and cannot borrow to trade.
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Plain-English education — not personalized legal, tax, or investment advice.