Margin in trading is a fairly simple process of trading specific instruments that are purchased using funds provided by a broker or any other third party. In other words, a trader has a chance to access a larger number of assets or a bigger sum without owning those funds. On the one hand, it helps to leverage traders’ position. On the other hand, trade margin makes it possible to expand potential results, especially when it comes to markets with low volatility.

As a rule, the margin in trading is generally used to trade on Forex. However, some experts successfully utilize the concept of borrowing funds from a broker when trading commodities, stocks, and other popular instruments including cryptocurrency.
Margin Trading Definition
The concept is quite clear. Imagine an individual investor who does not have enough funds but still wants to purchase a specific number of stocks. In other words, a trader is planning to buy more assets that he or she can afford. This is where brokers are ready to lend a hand and provide traders with a specific loan that can be used to buy enough assets.
The concept requires traders to speculate a lot. The main idea is to foresee the movement of the stock price within a given timeframe or trading session. Then, a trader purchases a needed number of assets using funds borrowed from the broker and pays back the rate negotiated in advance.