Suze Orman
👤 SpeakerAppearances Over Time
Podcast Appearances
You have $10,000 after you've sold 2,000 shares.
KT at $5 a share is 10,000, but you owe the broker $10,000.
And interest.
And now you lost all of your money.
But here's the thing.
The brokerage firm is not going to allow you
to get that low.
There's something called a margin call.
That if the stock starts to go down and they think that there isn't enough money in your account after you sell
to get back their $10,000, they're going to call, they're going to want more money for you to be able to stay on margin.
You can't come up with that.
Or if it continues to go down, oh, they're going to sell the stock and you're not going to have any money.
It's going to be gone.
Margin is- High risk.
the highest risk that is out there and the most stupid thing, in my opinion, anybody can do.
Have I ever in my entire career invested on margin?
I have not, and I never would, which is why
you don't know about it because we've never done it.
All right, KT, next question.
Mama, listen to me, sweetheart.