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Fortune
Fortune
Ivana Pino

Margin accounts explained: Are the rewards worth the risks?

Photo illustration of a laptop showing investment data and a man's hands taking notes. (Credit: Photo illustration by Fortune; Original photo by Getty Images)

If you're looking for a way to leverage your brokerage account and maximize returns from investing, a margin account may be one way to do it.

Aside from traditional cash accounts, many brokerages also offer margin accounts. These allow you to borrow against the value of the assets in your portfolio, giving you more money to invest. While this might sound like a win-win, investors should know that a potentially greater payoff may also mean taking on greater risks. 

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