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Buying Power

 

The money an investor has available to buy securities. In a margin account, the buying power is the total cash held in the brokerage account plus maximum margin available.

Also referred to as "Excess Equity."

 

For example, if you had $1000 cash in a margin account and the maximum margin rate is 50%, then your total buying power is $2000. For a non-margin account, the buying power is equal the amount of cash in the account.

 

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