Margin Financing
What is margin financing and how does it differ from a funded account?
Margin financing lends against securities you already own; a funded account gives you access to the firm's capital after an evaluation.
They are different products that solve different problems, and the distinction matters before choosing either.
Margin financing
You already own a portfolio. We lend against it, and you use the loan to increase your market exposure. The securities remain yours, you keep the economic exposure including dividends, and you pay interest on the borrowed balance. You bear the full loss if the position moves against you, and losses can exceed your deposit.
Suited to: investors with an existing portfolio who want more exposure without selling holdings.
Funded accounts
You do not have capital deployed. You pay a fee to take an evaluation on a simulated account, and if you clear it, you trade our capital and keep a share of the profit. You do not bear losses beyond the fee you paid.
Suited to: traders with a tested strategy but limited capital.
The core difference
Margin financing amplifies your own capital and your own risk. A funded account replaces your capital with ours, capping your downside at the program fee and capping your upside at the profit split.
Neither is better; they answer different questions. If you already hold a portfolio, margin financing is likely the relevant product. If you have skill but not capital, the funded route is.