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Lesson 9. Opening a Brokerage Account > Margin Account - Pg. 50

Opening a Brokerage Account 50 · A cash account is a brokerage account in which the investor may purchase stock equivalent to no more than the amount of money available. · A margin account is a brokerage account whereby an investor can purchase stock with money loaned by the brokerage. The amount of the loan cannot exceed the amount of money main- tained within the account by the individual investor. · Direct Reinvestment Plans (DRIPs) are programs offered directly from companies whereby po- tential investors make systematic purchases of the stock in return for absorbed broker costs and reduced share prices.