Are there any disadvantages to trading on margin?

[dtownreppin214]

I'm considering to upgrading my account to a margin account. I'll be working with a 6:1 ratio.

Is there any disadvantage to this other than the extra risk?

 

[Domingo Halliburton]

you're borrowing money. Losses and profits will be magnified. If you get a margin call you'll have to either re-pay some of the money or sell some of your securities to cover it.

 

[Ohene]

will borrowing allow for a tax credit for interest purposes?

 

[dtownreppin214]

yeah i will have an account attached so they can withdraw to cover any major losses but i don't plan on that happening. i'm just wondering if there are any unknown fees i should know about.

 

[Domingo Halliburton]

are you using an online broker? one of the hidden fees with those is higher bid-ask spreads

 

[dtownreppin214]

yeah it's an online broker. suretrader.

2k minimum, buying power refreshes automatically, unlimited intraday traders is my reasoning for making the switch. i to need ask about the spreads, good point.

 

[OH SOHH TRILL]

yeah i will have an account attached so they can withdraw to cover any major losses but i don't plan on that happening. i'm just wondering if there are any unknown fees i should know about.

does anyone "plan" on losses?

 

[chineebai]

most people who play on margin, honestly, don't know what the fukk they're doing and end up losing a shyt load of money. Why not play options, it's like leveraging more money than you have.