Should I borrow to trade? What is margin trading?
Should I borrow to trade? What is margin trading?
How much can investors borrow? How is margin interest calculated?
Key takeaways：
主要收穫：
Trading on margin means you are investing in stocks with borrowed money.
Margin trading is very risky - it amplifies both gains and losses.
How much can investors borrow? How is margin interest calculated?
保證金交易意味着你用借來的錢投資股票。
融資融券風險很大--它既放大了收益，也放大了損失。
投資者能借到多少錢？保證金利息是如何計算的？
What is margin?
什麼是保證金？
Trading stocks on margin seems like a great way to make money. If you have a few thousand dollars in your account, you might qualify to borrow money against your existing stocks at a low-interest rate. You can use that borrowed cash to buy even more stock.
保證金交易股票似乎是一種很好的賺錢方式。如果你的賬户裏有幾千美元，你可能有資格以現有股票為抵押以低息借錢。你可以用借來的現金買更多的股票。
In theory, this could leverage your returns.
從理論上講，這可能會影響你的回報。
Before investing, you must know the RISK!
在投資之前，你必須知道風險！
The reality: Margin trading is an inherently risky strategy.
現實情況：保證金交易是一種固有的高風險策略。
It allows aggressive traders—both individuals and institutions—to buy more shares than they could otherwise afford. When things go according to plan, these investors make a lot of money. When things go south, it can get really ugly, really quickly.
它允許激進的交易者-無論是個人還是機構-購買比他們原本負擔得起的更多的股票。當事情按計劃進行時，這些投資者賺得盆滿鉢滿。當事情變得糟糕時，它可能會變得非常醜陋，很快就會變得非常醜陋。
How does margin trading work?
融資融券交易是如何運作的？
To explain in a simple way, we assume there are no interest costs in margin trading, which is the opposite in reality.
簡單地説，我們假設融資融券不存在利息成本，而現實中恰恰相反。
Imagine you have $500 in the trading account, which is your maximum buying power. However, to buy 10 shares of company A (each share is worth $100), you need $1,000 in total.
假設你的交易賬户裏有500美元，這是你最大的購買力。然而，要購買A公司的10股股票(每股價值100美元)，你總共需要1000美元。
With margin trading available, you can fund half the purchase price with your own money and buy the other half on margin.
有了保證金交易，你可以用自己的錢支付一半的購買價格，然後以保證金的方式購買另一半。
Good scenario:
好場景：
One year later, the share price rises to $200. You can sell the shares for $2,000 and pay back the broker the $500 borrowed for the initial purchase. Ultimately, you triple your money, making $1,500 on a $500 investment.
一年後，股價漲至200美元。你可以以2000美元的價格出售股票，然後償還經紀人最初購買時借來的500美元。最終，你的錢翻了兩番，500美元的投資賺了1500美元。
Bad scenario:
最糟糕的情況：
After a year, if the share price falls by half to $50, you sell at a loss and receive $500. Since this equals the margin amount, you lose 100% of the $500 initial investment.
一年後，如果股價下跌一半至50美元，你將虧本出售，獲得500美元。因為這等於保證金金額，你會損失500美元初始投資的100%。
How much can investors borrow?
投資者能借到多少錢？
For the proposed IPO, each brokerage firm will decide the amount they can lend to their clients for stock purchase based on their own risk assessment of the IPO, with the maximum bar multiplier generally not exceeding 9 times.
對於擬進行的首次公開募股，每家經紀公司將根據自己對首次公開募股的風險評估，決定可借給客户購買股票的金額。最大條數乘數一般不超過9倍。
That is, if there are $100 in the account, the margin amount is up to $900.
也就是説，如果賬户中有100美元，保證金金額最高可達900美元。
However, not all stocks can be used to pledge margin trading.
然而，並不是所有的股票都可以用來質押融資融券。
Further reading: How to know whether a stock supports margin trading on moomoo?
How is margin interest calculated?
保證金利息是如何計算的？
The margin interest is calculated from the subscription deadline to the announcement of the results.
保證金利息由認購截止日期至公佈業績計算。
Assuming that the subscription deadline is November 4, the IPO is listed on November 12, and the results are announced on November 11, the interest will be calculated from November 4, and the margin will be used for a total of 8 days.
假設認購截止日期為11月4日，IPO於11月12日掛牌，11月11日公佈結果，從11月4日開始計息，保證金共使用8天。
Total interest payable = 900*2%*8/365 （2% interest rate）
應付利息總額=900*2%*8/365(2%利率)
by Rachel
作者：雷切爾
