The borrowed money is called the margin loan, and they are said to buy on margin.
The interest rate that the buyers pay for their margin loan is called the call money rate.
The initial margin requirement is the minimum fraction of the purchase price that must be trader’s equity.
The relation between risk and borrowing is called financial leverage (often simply called leverage).
To prevent such losses, brokers require that margin buyers always have a minimum amount of equity in their positions. The minimum is called the maintenance margin requirement.
If the value of the equity falls below the maintenance margin requirement, the buyer will receive a margin call, or request for additional equity.
