What's the difference between margin and leveraging?

Question

any help is appreciated, thank you :]

Answer 1

When you use margin, you are leveraging.

Answer 2

Margin is the white space on the left, right, top, and bottom of the page.  You're supposed to leave this space blank.

Leveraging is when you use your advantages to act or to influence people, events, or decisions.

Answer 3

I am assuming you are talking about an investment account as opposed to a company.

Margin is using assets in your account as collateral. For example, if you buy a stock on margin that means you are borrowing money from your broker to pay for the stock, using other assets (stocks or bonds) already in your account as collateral.

You also use margin with certain types of derivatives, such as futures and options, or when you sell a stock short. However, this use of margin does not usually involve borrowing money. Instead the margin is used simply to make sure you have enough assets to cover losses you may experience.

Leveraging is increasing the amount of profit or loss your investment experiences as a result of a change. For example, assume I had $50,000 in a brokerage account and I wanted to buy a stock that cost $50 a share. Without leverage, I could buy 1,000 shares and would make $10,000 if the stock went up to $60 per share. However, if I used those shares as collateral to borrow another $25,000 from my broker I could buy 1,500 shares and would have a profit of $15,000 (less the interest payments on the loan) if the stock went up to $60. Of course, if the stock went down to $40 I would have increased my loss from $10,000 to $15,000.

If a future on the stock was available, I could have leveraged my position much more by buying a future on the stock instead of the stock itself.

Some methods of leveraging do not require the use of margin. For example, if I bought $50,000 worth of call options on the stock I would have increased my leveraging without using any margin.