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Margin Trading

Trading on margin allows you to leverage securities you already own to purchase additional securities, sell securities short, protect your account from overdraft, or access a convenient line of credit.

Why choose Fidelity for margin?

Low rates

Our margin rates are among the most competitive in the industry—as low as 3.75%.* The rate you pay depends on your outstanding margin balance—the higher your balance, the lower the margin rate you are charged.

View commissions and margin rates.

Powerful tools

The Margin Calculator helps you view current margin requirements for each of your positions, model hypothetical trades to view their potential impact, and see how price changes can affect your margin requirements and margin balances.

Margin alerts—including margin call notifications— can be sent via email, Active Trader Pro message center, or mobile device.

Real-time margin balances provide you with the up-to-date information you need to make trading decisions.

Convenience

Borrow for any purpose, at any time. Once you have been approved for margin borrowing, there are no additional forms to complete, application fees to pay, or loan officers to consult.

Repayment flexibility

There is no set repayment schedule as long as you maintain the required level of equity in your account. Interest charges on outstanding balances are posted to your account monthly. Any cash dividends (not enrolled in dividend reinvestment) and interest received will be automatically applied to your margin balance.

The advantages of margin

Opportunity to leverage assets

Margin borrowing lets you leverage securities you already own to purchase additional securities. This gives you the opportunity to amplify returns, but it can also increase risk.

Advanced options strategies

Having both a margin and an options agreement allows you to place advanced options orders such as spreads, butterflies, and uncovered options on equities, ETFs, and indexes.

Tax-deductible interest

Interest on margin loans may be tax deductible. Consult your tax advisor for details regarding your particular situation.

Margin risks

Determine whether margin is right for you

Margin investing carries greater risks and may not be appropriate for every investor. Before you use margin, carefully review your investment objectives, financial resources, and risk tolerance to determine whether margin borrowing is appropriate for you.

Two of the risks associated with margin borrowing are:

  • Leverage risk
  • Maintenance call risk

Know the requirements

If the market value of the securities in your margin account declines, you may be required to deposit more money or securities in order to maintain your line of credit. If you are unable to do so, Fidelity may be required to sell all or a portion of your pledged assets.

More information

Trading FAQs: Margin Borrowing
Get more information on margin borrowing, including margin requirements, margin calls, and day trading restrictions.

View important information about using margin (PDF).

Questions?

Other ways to use margin

  • Options

    Trade confidently with advanced analytics, custom screeners, and expert commentary.

  • Short selling

    Enter short sale and buy-to-cover orders for any U.S. stock.

*3.75% rate available for debt balances over $500,000. Fidelity’s current Base Margin Rate, effective since 01/12/09, is 6.575%.

Options trading entails significant risk and is not appropriate for all investors. Certain complex options strategies carry additional risk. Prior to trading options, please read Characteristics and Risks of Standardized Options, and call 800-343-3548 to be approved for options trading.  Supporting documentation for any claims, if applicable, will be furnished upon request.

In order to short sell at Fidelity, you must have a margin account. Short selling and margin trading entail greater risk, including but not limited to risk of unlimited losses and incurrence of margin interest debt, and are not suitable for all investors. Please assess your financial circumstances and risk tolerance prior to short selling or trading on margin. Margin trading is extended by National Financial Services, Member NYSE/SIPC, a Fidelity Investments company.

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