Nolo's Plain-English Law Dictionary

Legal Dictionary Home

Need Professional Help? Talk to a Lawyer
Enter Your Zip Code to Connect with a Lawyer Serving Your Area
searchbox small
1) The difference between the net sales price of an item or security and its cost. This is often called a profit margin and is frequently expressed as a percentage. For example, if you pay 50 cents for a pencil and sell it for a dollar, your profit margin is 50%. 2) The difference between the face value of a loan and the market value of the collateral that secures it. 3) An investor's equity in securities purchased on credit through a broker. 4) Cash or collateral that must be deposited with a broker who agrees to finance the purchase of securities.