Review how margin accounts work, how Regulation T and maintenance rules apply, and where leverage creates added exam risk.
Margin questions test the mechanics of leverage and the rules that limit it. The Series 7 expects you to know why customers use margin, how Regulation T and maintenance requirements work, and where added leverage creates suitability, liquidation, and operational risk.
This chapter starts with margin-account basics, then moves into Regulation T and margin calls, and finishes with the special rules that apply to short sales, day trading, and portfolio margin.