If the common stock is $50 a share on 50% margin. This means that the: brokerage firm is lending the investor 50% of the money.
Brokeage
Common stock:
Common stock=1,000 shares×$50 per share×(50% margin)
Common stock=$50,000×50% margin
common stock=$25,000
Based on the above calculation the 50% margin simply means that the brokeage company is borrowing the investor the 50% of the money which is $25,000.
Therefore this means that the: brokerage firm is lending the investor 50% of the money.
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