---
title: Margin Trading
group: Trading
subtitle: Borrow against your portfolio to increase buying power, at a 6.75% annual rate.
description: How margin trading works at Light Horse Securities — buying power calculations, the 6.75% annual rate, margin calls, and the risks of trading on borrowed funds.
---

## What Is Margin?

Margin allows you to borrow money from Light Horse to purchase securities, using your existing portfolio as collateral. This amplifies both potential gains and potential losses.

## Margin Rate

Light Horse charges **6.75% per year** on borrowed margin balances. Interest is **calculated daily** and **charged monthly**.

## How Margin Buying Power Works

When margin is enabled, your buying power is greater than your cash balance. Your margin buying power depends on:

- Your account equity (market value of positions + cash)
- The **maintenance margin requirement** — typically 25–30% for most securities
- The **initial margin requirement** — typically 50% (Reg T)

For example, with $10,000 in equity, you may have up to $20,000 in buying power (2:1 leverage on overnight positions).

## Day Trading on Margin

Under the updated FINRA Rule 4210 (effective June 4, 2026), intraday margin is calculated in **real time** based on your margin excess. You are no longer subject to a fixed $25,000 day trading minimum.

## Margin Calls

A **margin call** occurs when your account equity falls below the minimum maintenance margin requirement. When this happens:

1. You'll receive a notification to deposit additional funds or liquidate positions
2. If you don't respond promptly, Light Horse may liquidate positions in your account to bring it back into compliance — without advance notice

**Margin calls can happen quickly in volatile markets.**

## Risks of Margin Trading

- You can **lose more than you invested** — your losses are amplified just like your gains
- Margin interest adds to your cost basis over time
- Forced liquidations may occur at unfavorable prices

Carefully read the [Margin Disclosure](/terms/margin-disclosure) before enabling margin.

## Frequently Asked Questions

### How do I enable margin on my account?

Contact Light Horse support or apply through your account settings. Margin approval is subject to eligibility requirements.

### What is the margin interest rate?

Light Horse charges 6.75% per year on margin balances, calculated daily and charged monthly.

### Can I lose more than I deposited if I trade on margin?

Yes. Margin amplifies both gains and losses. In extreme cases, you can owe more than your initial deposit.