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A call loan is a loan that the lender may force the borrower to repay at any time.
Call money is a very short-term bank loan that does not contain regular principal and interest payments.
A demand loan is a loan where the lender may require the borrower (a brokerage house) to repay at any time. These loans may also be called a broker loan or call loan,
The call loan rate is the interest rate charged on the call loans used by brokerage houses to fund clients' margin trading accounts.
The call money rate, sometimes known as the 'broker loan rate,' is the interest rate on the loans banks make to brokerage firms that are borrowing to fund transactions in their clients' margins accounts.
How Does a Broker Loan Work? Also known as a call loan or demand loan, a broker loan is granted to a brokerage house in need of short-term capital for financing clients' margin portfolios. The lending bank can call the loan at any time. Likewise, the brokerage house may repay a broker loan in full without prepayment penalties. Broker loans are collateralized using securities, and interest ...
A clean up call is a feature of a collateralized mortgage obligation (CMO) that requires the issuer to pay off a portion of the CMO.
This original loan amount as a percentage of the investment amount is called the initial margin. If the value of the Company XYZ shares drops and the value of the account holdings falls to 25% (the maintenance margin) of the original $5,000 value (or $1.25 per share), the brokerage firm may make a margin call.
Buying on margin refers to borrowing from a brokerage firm (through a margin account) to make an investment.
InvestingAnswers' glossary of financial definitions and business terms that begin with the letter "C"