Margin trading is the practice of buying or selling financial instruments on a leveraged basis, which enables clients to open positions by depositing less funds than would be required if trading with a traditional broker.
For example, if you were going to buy £100,000 worth of physical shares then the initial outlay would be £100,000 of your capital, up front. In comparison, had you taken the equivalent position with a spread bet, then you would only need to deposit £10,000 as margin, (assuming the margin level for the trade was 10%). Margin varies…
from Forex Trading Co – Currency Markets Explained: Tips, Strategies + More For Online Traders