How to Add Margin to Your Account
Fidelity offers you the opportunity to borrow against stocks and other securities you already own in your account. The good news is, most of the time, you can apply online.
What's margin and what can I use it for?
Margin, also known as leveraging or buying on margin, allows you to borrow against securities you already own in your account. You can use this loan (up to a specified dollar amount) to purchase additional securities, protect your account from overdraft, or access a line of credit. Plus, margin gives you access to use more complex trading strategies such as short selling and multi-leg options. Because you're borrowing some of the money to pay for the shares, you may have the potential to realize greater gains than you would by buying the stock entirely with cash.
Margin trading entails greater risk including but not limited to risk of loss and incurrence of margin interest debt, and is not suitable for all investors. Please assess your financial circumstances and risk tolerance prior to trading on margin. Margin credit is extended by National Financial Services, Member NYSE, SIPC.
While there are benefits to establishing a margin account, it's also critical to fully understand the risks before you get started. Margin is a loan that you’ll be responsible for paying interest on. Make sure you read Important Information about Using Margin before you apply for and start using margin.
What do I need to know?
For starters, your account needs to be approved for margin. From Accounts & Trade, you'll select Update Accounts/Features. On this page, you can add margin as a feature to your eligible accounts. If the account isn't on this list, then it's not eligible to add margin.
You can only add margin to one account, per registration. If you already have margin on a different account, in most cases, you’ll need to revoke it before adding a new account.
When you complete the online application, you’ll need to provide some basic information, like where you work and your salary and income levels.
If you prefer, you can download and print the Margin Application (PDF). Mail your completed form to:
PO Box 770001
Cincinnati, OH 45277-0045
Before you use margin, carefully review your investment objectives, financial resources, and risk tolerance to determine if margin borrowing is appropriate for you.
Take the time to familiarize yourself with Understanding the benefits and risks of margin.
What to expect
You'll find out in 2 to 3 business days whether or not you've been approved for margin. We’ll send the confirmation—either by email or U.S. Mail—based upon your delivery preferences.
After your account is approved for margin borrowing, you can take out a margin loan at any time, without any additional forms or applications. If your brokerage account includes checking, you can simply write a check.
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