SIE practice questionmediumAccount Types - Margin vs Cash
Which of the following accounts allows borrowing funds to purchase securities?
- AMargin account✓ Correct answer
- BCash account
- CRetirement account
- DCustodial account
Explanation
Why A — Margin account
Margin accounts permit borrowing (leverage). Cash, retirement, and custodial accounts require full payment for securities.
Turn it into reps
Reading one answer is not the same as being ready
Lucky the Banker is a free practice app with 1,867+ SIE questions, weak-area tracking, and timed mock exams. No credit card, no paywall.
Spot an error in this question or explanation? Tell us — we fix these fast.
Related Account Types questions
- A customer wishes to open an account for their 13-year-old child to start investing in stocks. What type of account…
- Which account type allows for tax-deferred growth for retirement savings?
- Which of the following account types is specifically designed to provide tax advantages for retirement savings?
- Which account type is established for a minor and managed by an adult until the minor reaches legal age?
- A customer wants to buy stock using borrowed funds. Which account must be opened?
- Which account type is designed for the benefit of a minor, with an adult acting as custodian?
- A parent opens a custodial account for a minor. Who is the legal owner of the assets in the account?
- According to FINRA rules, what is the minimum maintenance margin requirement for an equity margin account?