12-04-2021, 03:52 AM
I don't use margin anymore but Crimson is right. If you wait for a real correction to mostly play out a little margin won't hurt you. After a big dip the market would have to dip to gut wrenching levels to hurt you with 10 or 20% margin. That is plenty of margin until you have some experience. Most people that get in trouble have an entire port of speculative holding.
This is when you buy AAPL or V way off it's high. It's not when you buy profitless Specs that are still overvalued. Don't buy a stock like BABA that still falls 4 days a week. Crypto and options are a bad idea. Falling knife buys cause margin calls. The market can be brutal and that $100 stock that was actually worth 60 can indeed fall to 25 and stay there awhile. I may have some experience in this matter early in my investing career. Excessive margin eliminates the option of being patient.
This is when you buy AAPL or V way off it's high. It's not when you buy profitless Specs that are still overvalued. Don't buy a stock like BABA that still falls 4 days a week. Crypto and options are a bad idea. Falling knife buys cause margin calls. The market can be brutal and that $100 stock that was actually worth 60 can indeed fall to 25 and stay there awhile. I may have some experience in this matter early in my investing career. Excessive margin eliminates the option of being patient.