There need not be. Margin is no more mysterious than any other form of leverage or debt. People borrow money to buy a home, a car, or a boat, to pay college tuition or finance a wedding, and sometimes to take a vacation. In the cases of mortgages and home equity lines of credit, the loans are secured by real estate. In other instances, such as paying bills with credit cards, the loans are unsecured , with only the borrower's credit history reassuring the lender that the money will be repaid.
Margin is a secured loan, with stocks, bonds, and other securities serving as collateral.
Many investors think of margin only when buying stocks for example, borrowing against the value of their securities to buy additional shares of a stock. In reality, margin can be used for all sorts of reasons, including many of those mentioned above. Using margin to finance various financial needs may make sense when it is cheaper to borrow against your securities than from other sources, as long as you are aware of the risks involved. The risks depend on several factors, including the kinds of securities you borrow against, the number of issues in your portfolio, the amount you borrow, and others. You should be aware, however, that when you margin your securities, it is possible to lose more than the amount you have invested.