The big attraction offered by margin accounts is
A) Leverage potential
B) Capital gains
C) Interest reduction
D) Less risk
E) All of the above

Question

Quizplus · Accepted Answer

The big attraction offered by margin accounts is the potential for leverage. This allows traders to borrow funds from their broker in order to make larger trades than they would be able to with just their own capital. While this can result in higher gains, it also increases the level of risk involved. Capital gains, interest reduction, and less risk are not necessarily unique to margin accounts and can be achieved through other investment strategies.

The Big Attraction Offered by Margin Accounts Is