Series 6 - Investment Company And Variable Contracts Products Representative Exam
Preview Mode
In a margin account, if the value of the securities declines significantly, the customer may be subject to:
A margin call
A
A leverage call
B
Call risk
C
Repayment risk
D
Explanations
A margin call is when the securities in a margin account fall in value and the brokerage firm can either require the customer to deposit cash or securities immediately or sell any of the securities in the account to cover a shortfall -- without notifying the customer in advance of the sale.