Robinhood Margin: (Everything You NEED to Know)
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- Опубліковано 1 лип 2024
- Watch this video BEFORE you start investing with margin on Robinhood. Robinhood margin is simple to understand once you know how it works, however it is important to educate yourself to make sure you are making the right decisions when using the feature.
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This video covers:
- What investing on margin means
- The benefits and risks of margin investing
- How to enable margin investing
- How much money you need to invest on margin
- How to increase your margin amount
- Costs of investing on margin
- How margin calls work
- Investing in Crypto with Robinhood Margin
- Buying Options with Robinhood Margin
Let me know if you have any questions down in the comments.
Timestamps:
Intro: 0:00-0:39
Margin Investing Explained: 0:40-1:57
How to Enable: 1:58-2:29
Minimum to Invest: 2:30-2:55
Increasing Margin: 2:56-3:29
Costs: 3:30-5:00
Margin Calls 5:01-7:09
Crypto: 7:10-7:38
Options: 7:39-9:00
📝Sources:
www.bankrate.com/investing/bu....
🚩Disclaimer: I am not a financial advisor. These videos are entertainment purposes only. Any stocks discussed on the video are not to be considered “investment recommendations”. Unless investments are FDIC insured, they may decline in value and/or disappear entirely. You (and only you) are responsible for the financial decisions that you make. These videos are strictly for entertainment and do not reflect the opinions or values of anyone else other than myself.
How do you like the editing style in this video? Is it engaging and helpful? Let me know your feedback below!
id like to learn how to edit like that wow!
One more to add, RH will only charge you interest on money you are using. If it is sitting in your buying power it won’t charge you which is amazing.
Hey do you know if your margin sits in your buying power and you have RH gold do you earn interest on that? Does it count as universes cash?
Thanks
@@ksubramany1 margin money CANNOT earn interest on it. Only your own money can
W
What About If They Have It In BROKERAGE HOLDINGS
@@charlesgair8608 you only get charged interest after you used all your own cash buying power. If it’s sitting in your brokerage and not being used then you won’t get charged that’s what Robinhood does.
Thank you, love this video.
great video, explained well and a lot of information was given clearly. nice thanks
Very well explained, thank you bro
Glad it helped
Great video
Thanks!
great video, however, i heard robin hood as a plan where u choose to pay margin rates on ur margin in exchange w/ giving up your profits at a greater percentage, is that true?
How much margin can I use? What if my margin purchase power says $10,000. Can I use all of it, or only 50%? Thanks
hi how long I can allowed to hold my margin position in margin trading. how much maximum leverage I will get in margin trading
i like to use my personal funds for option investing. How do i make sure the margin is used for a stock purchase and my funds are not used?
So if I have 20k and get 5k margin are the odds of me getting margin called lower since I have plenty of collateral
So let’s say you take margin $1000 at 10% rate and buy 10 shares of a 100.00 stock. One week later the stock is worth 110.00. What is due to who and when ? Is it like a loan at a rate of 6.5% you can pay back out of your account ? When do you pay it back
I have $2100 they offered me $5’768.00
Can you withdraw your margin money or you can’t?
Is there any fees charged by Robinhood on Margin Collateral?
all these videos including yours show you how to turn on margin investing but they never actually show you how to use the button. is my buypower supposed to be higher is there a separate buy button to buy on margin. I've been a long-term dividends kind of guy. and I thought to myself 2 to 1 would be an excellent boost. but sadly once this is turned on. I cannot proceed
You say the margin fee is per day, but the interest on the margin is yearly but accrues daily. So whatever the percentage is divided by 365 times the borrowed amount is what you owe.
If I take 15,000 on margin how much I have to pay monthly on interest????
I borrow $2000 and have a porfolio value 20k what it means margin maintenance 5k ?
Quick question if I take out a loan on RH can I just leave it on my brokerage account so my cash sweep can use it and I gain the 5 percent rate ?
No margin is only accessible to buy securities with
How does this work with options? Do you pay the interest on winnings at eom still?
???? Fr
Great video but I have a question ask! When it comes to Margin accounts in Robinhood, how does Robinhood charge their percentage monthly?! Is automatically through the Robinhood app or they bill you?!
Automatically though the RH app.
Do you start paying the margin back as soon as you take it out before buying stock? Or only when you specifically buy stock with it?
So when you purchase the stock you purchase it on margin so it’s at the same time
@@TheRDGuarantee ok got it. I wasn’t sure if it was as soon as I set a borrowing limit
Can you pay the margin back I steps or do you half to pay it all in full?? I can’t seem to fiqure that out. Thanks
This is my question as well
I have few questions. Apologies, I am still learning about Margin investing but do not know enough.
I have Robinhood Gold. Let's say I am borrowing 3000$ . First 1000$ is interest free and I get charged 8% on 2000$.
1) Do I pay 8% interest just on the borrowing amount or capital gains/profits as well.
What if the Stock I bought for 3000$ becomes 20,000$ after few years. Do I still pay 8% on borrowed 2000$ or 20,000$
2) Do I keep Paying margin interest every month/year until I sell my stocks/securities?
3) How do I pay off margins? Just keep uninvested/ unspent cash on account?
4) Does Margin investing make sense in this kind of long term investing situation?
Thank you. Looking forward to your reply.
#1, just on the amount borrowed. #2 Yes, you pay until you have no margin. If they are letting you borrow money, it will cost you each month. #3, let's say you have 4k worth of xyz stock, of which 2k is on margin. Say xyz companies stock goes from $10 a share to $20 a share. You have doubled your money but you still owe robinhood $2k. You can either put $2k more money into your margin account to settle the margin or sell enough shares to cover that $2k. Either way, you will always owe them the original amount back and continue paying margin rates, regardless of whether your stocks go up or down, until the margin is paid back. Over 6 months or 6 years, doesn't matter. #4, Margin is useful in good markets on good stocks and can be quite lucrative, but over the long term, most experts would probably tell you that it's not a good idea to use margin long term. Of course, unless you have sufficient capital elsewhere to cover any margin calls, and that becomes a point of contention as you are paying to borrow money when you have money. Either way, good luck out there.
If you wanted to pay off your margin sooner than the amount they charge you per month can you do that? And also if you can do that... How do you do that on the RH app?
good question. did u happen to figure out how that works?
I have just been trying to educate myself on it a little more. How does the margin withdraw feature work? I have not been able to figure it out yet.
Just a way to pull out some of your stock money without having to sell your stock holdings, seems iffy
Keep an eye out for a follow up video answering this question
Per day ?
yall margin is important in any type of app. I had no idea and lost 52K😭
I’m trying to figure out that I hear you don’t have to pay margin interest if your using options with margin and certain strategies like selling puts because you don’t actually own the shares
Yes that’s correct selling puts and not getting assigned you won’t pay interest which is the dream because technically you aren’t using the money yet since you haven’t gotten assigned on those shares.
So if I barrow say 15k on my 17k account almost a 1-1 but I put my own 15k into Bitcoin “my actual cash” but I still have 2k of my money in buying power and I just day trade the 15k margin I won’t get margin called? Unless my 15k$ in Bitcoin drops to 25% ?
You have probably figured this out by now but NO. You cannot buy cryptos on Margin. So if you have 15k in Bitcoin and 2k in cash, you can only use the 2k +2k Margin. I hope you had some Bitcoin at that price 6 months ago and you still have it :D") cuz its worth alot more now
If you have buying power from margin but you are not buying any stock with margin money do you have to pay interest?
No but you have to pay attention cause you deposited money shows up in your buying power
So if I just use the $1000 of margin and nothing else, I won’t get charged interest if I subscribe to Gold? 🤔
Right I’m confused
So..lets say i borrow $2000 against my stocks, 1 month later i deposit $500 back into my robin hood account (buying power) from my bank account, would my monthly charge go down since im no longer borrowing full amount?
It's all about the amount you borrow. If you're still borrowing $2000, your interest charge will stay the same.
Ohhh!! That makes sense, thanks!
I have a question on Robinhood margin spending how does it work.
If you have 2k cash in robinhood and set your account to margin, they will loan you another 2k to buy stocks with depending on the stock. You will pay a certain percentage each month to borrow that money. If you want to only use $200 of that 2k margin and have $2200 of stock, that would work also. You can use anything up to your account total. If you have 10k, they will let you borrow 10k on margin, if you so wish. Please remember that using margin can be very costly if the market does not go your way. Good luck out there
Per day?!
How Do You Get Off Of Robinhood Margin?
There is an option to disable margin in settings. Make sure you sell your margin-able security
I lost. I transfer funds from my bank and buy crypto and got a Margin call. I don’t even know what this is? I’m using my own money to invest
For a divided strategy is margin a good idea say the dividend pay the interest
Probably a little risky. I'd need to do the math, but I'm pretty confident that you'll be paying more in margin interest than you'd gain in dividend payout.
Would a high income etf work like Tsly??
@@jremyinoklahoma6792 i dont like tsly i bought 100 shares when it was 17$ then lost a ton when it dropped to 9$ a share i like cony better
But how do you withdraw a margin loan to your bank account to use for something else?
Lmaooo..you can't withdraw the borrowed money only your own
Bummer. You can with M1.
how do you pay back your margin?
That’s what I’m trying to figure out
Can you pay the money back anytime?
The longer you hold the higher the risk of loss. If you get margin called, they typically want you to deposit that day, and they could force a sell the next day, or 2 days after. Basically you never want to get in a position where your losses are great enough that you need to put money back in, because it's typically a losing battle. Where you deposit more money, but the stocks borrowed go lower twice as much as normal, and you typically won't have collateral sitting in your other banks to cover it. Basically I got severely burned, because I didn't sell for a tiny loss, but it would have been a $3,000 loss for me, and my brain went into shock mode, and I let that $3,000 loss grow substantially bigger. If you trade big, you need to sell quicker when losing, or you lose big.
did you really get a margin call after 1 day in apple stock. im trying to learn about margin safely but that sounds absolutely insane to me damn
My situation was unique. I put approx $2k into a short term apple trade using margin, and also took the chance to film this video to show everybody what investing on margin looks like at the same time I took this trade.
Unfortunately, Apple dropped about 1.5% the next day and I hadn't funded the rest of my account with the money to absorb that type of drop... so I got margin called 😐
But it was a good illustration or demonstration of the risks involved with this type of investing. I like your video and subscribed. @@TheRDGuarantee
So the interest is daily ? For example $2000x7% is 140, will this be daily?
I was wondering this is as well. Is it a APR that’s calculated daily and charged monthly? Or is the percentage shown charged to you daily
The interest is calculated daily and charged monthly.
Any interest number you see is based off of one year. (APY = Annual percentage yield)
@@TheRDGuarantee thank you! I am thinking of withdrawing the margin Robin Hood gives me for another investment
@@TheRDGuarantee thank you! I was thinking of withdrawing the margin they give me for a cash investment, what are your thoughts on this?
Never Ever Ever Ever Let Robin Hood Get You On MARGIN. EVER.
Don’t tell me what do with my money. I like to lose money
@@michaels4640 O K Big Spender Ha Ha.
How come?
11% per day. What in the loan shark
11% annual rate I believe.
This sounds like a bad idea no matter how well the fiscal year is going.
Takes a really high risk tolerance to trade on margin
Or a very experienced trader who sells quickly when things are not going the right way.
@@TheRDGuarantee I went ahead and enabled Margin Investing a few weeks back just to see what would happen. I disabled it within a few hours without buying anything. I'm sure there will be a fee to pay and I liked what my buying power went to but I'm just not comfortable using someone elses money for investing when strings are attached or in this ropes.
I also had this stupid idea that MI would somehow affect my Cash Sweep positively but considering it's not actually my money I don't know why I thought that.
%11 per day is crazy
Crazy high!
I believe it's 11% annual rate.
I’ve heard u need 25k to qualify for margin. My account won’t let me use margin with 20k in it. Thoughts?
You need 25k to qualify for day trading. If you're under $25k you can't make more than 4 day trades within 5 trading days.
Go here to learn more: robinhood.com/us/en/support/articles/pattern-day-trading/
6:21 is wild
😵💫