Margin Trading

Investor Claims Is What We Do - All Day, Every Day

Since 1999 our law firm has recovered more than $350,000,000 for victims of investment fraud and misconduct.
  • Jury Verdict Won Against Prudential Securities $262 Million
  • Recovered for 100-Year Old Widow $30 Million
  • Recovered in Retirement Losses $10 Million
  • Recovered for a Large Group of Individual Investors $6.5 Million
  • Recovered for Elderly Victim in Ponzi Scheme Case $3.8 Million
  • Recovered for Elderly Ponzi Scheme Victim $3.2 Million
  • Recovered for More Than 50 Families of Ponzi Scheme in California $3.2 Million
  • Recovered for 35 Families in Northeast Ohio $3.1 Million
  • Losses Recovered for 20 Retirees $3 Million
  • Recovered for Retired Physician Against Major Wall Street Firm Prior to Filing FINRA Arbitration $2.5 Million

Do you need a Margin Trading Attorney?

Answers From an Investment Fraud Lawyer

Buying on margin is a tactic certain investors use to increase their purchasing power and, hopefully, their investment return. When buying on margin, an investor borrows part of the funds needed to purchase a security from his or her brokerage firm. While buying on margin carries a potential for greater reward, it also carries increased risks—including the potential to lose more money than was initially invested. The security itself is considered collateral on the loan. As such, the firm has the right to sell the security without informing the investor beforehand.

Brokers have a duty to inform their clients of these risks prior to accepting purchases on margin. If an investor suffers losses after buying on margin and was not informed of the risks associated with borrowing from the securities firm, the broker and the brokerage firm may be liable for margin trading abuse. Additionally, if a broker engages in margin trading on behalf of a client without first informing the client that a margin account is being opened, the broker can be held liable for any losses associated with buying on margin.

Understanding the Risks of Margin Investing

Margin investing, also referred to as margin trading, can result in substantial loss. While some investors understand the associated risks, brokers are often less than upfront about the downside. Before delving into the risks of margin trading, you need to understand what it entails.

Investors are generally drawn to margin trading due to the potential to increase their return on investment. For example, if they are able to borrow 50 percent of the cost to purchase a stock, they are in essence, doubling the possible gain on that investment. Of course, brokerage firms like margin trading, because it allows them to earn interest on the money that was borrowed; however, there are some significant risks to margin investing that every investor needs to know.

These risks include, but are not limited to, the following:

  • Potential for high losses.
    With margin trading, you take the risk of losing more money than what was invested. That is because you leveraged part of the money needed to purchase the investment.

  • Little control.
    The security purchased is viewed as collateral for the loan made. That means that the firm has the authority to sell it, without letting you know before the transaction takes place.

  • Costs are great.
    When you utilize a margin account, you are looking at interest costs, fees and commissions.

If you have lost money due to misconduct in your margin investment account or if your broker traded in your account on margin without your permission, you could have a broker fraud claim. Call us today at (800) 738-1960 to learn more. We proudly offer free and confidential consultations.

The Meyer Wilson Way

Results-Focused Representation
  • More than $350,000,000 Recovered
  • Voted Best Lawyers in America┬« for over Ten Years Running
  • David Meyer is the Immediate Past-President of Public Investors Advocate Bar Association (PIABA)
  • Over a Thousand Investor Claim Cases Since 1999
  • Exclusive Focus on Investor Claims & Class/Mass Action Lawsuits
  • Deep Bench of Skilled Attorneys and Staff Members


Meyer Wilson has represented over 1,000 individual investors in high-stakes claims across the country, and has recovered over $350 million on their behalves. See what former clients have to say about our team.

  • “I primarily worked with Courtney Werning throughout the process and she was informative and knowledgeable. I trusted and fully recommend Courtney and her team.”

    - S.R.
  • “The communication throughout the process was on par - and they took the time to indulge me with the various questions and opinions.”

    - R.G.
  • “What I truly appreciated was getting a great result for my Mom with limited involvement/stress on her.”

    - S.W.
  • “We went to arbitration with the other respondent and I got to see firsthand the level of professionalism and expertise the Meyer Wilson firm can deliver.”

    - D.V.
  • “Chad would take the time to call and talk with me. His explanations were always clear and concise. I also appreciate all the effort put into the details and statistics required to argue this case.”

    - P.N.
  • “Meyer Wilson was able to produce the results that we felt were obvious and warranted while several other firms and even state offices simply had trouble understanding let alone moving the case forward.”

    - B.K.
  • “My overall experience was positive and I would encourage anyone who even thinks they have been a victim of stockbroker misconduct to call David.”

    - S.T.
  • “Meyer Wilson represented me in a suit brought last year against my brokerage firm, securing a very fair and equitable settlement for me.”

    - R.G., M.D.
  • “Right from the start, you had the passion and desire to win this case for us. I have never worked with an attorney or firm as compassionate as yours. I would highly recommend your firm to anyone.”

    - G.A.

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