Your purchasing power cannot exceed your available funds and your maximum losses are limited to your total account value (cash plus stocks owned). Basically with a "Margin Trading Account" you can borrow money from your online brokerage firm to use on your behalf to place trades for buying stocks.
Keep in mind that the amount of interest you have to pay is small compared to the amount of profits you can make with a profitable trading system.
A Simulated Trading Account is an account you can open at most online brokers to buy and sell stocks without using real money.
Believe it or not, "Simulated Trading Accounts" have their pros and cons just as the other accounts have.


After our accidental discussion on demat accounts, one fine Sunday, I thought my friends must have had enough of finance.
So, I quickly drew them up a chart with the comparative rates I had in mind for an equity shares trading-cum-demat accounts. Amit finally seemed satisfied to have most of his queries relating to online investing resolved.
By now, each of my friends seemed convinced about the advantages of an online demat-cum-trading account. With a "Cash trading account" you can use the total amount of money you have deposited in your account for buying stocks.


I'm not saying that a margin account should or should not be used, but you should know the risks involved with trading using margin. In fact, I thought the discussion on online trading accounts will never see the light of the day.



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