I have $2500 dollars to put in my stock account. Should I open a cash or a margin account with the money that I have?

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Charles J. Stevens, Principal, evergreen financial, LLC

@CharlesStevens • 12/30/15 This answer was first published on 12/30/15. For the most current information about a financial product, you should always check and confirm accuracy with the offering financial institution. Editorial and user-generated content is not provided, reviewed or endorsed by any company.

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Cash only at this point.

The biggest problem with a margin account the size you're talking about is, if you margin to the maximum, you have no protection when the market goes down. That's not IF, it's WHEN. Having no safety net, your broker will start selling (liquidating) positions whether you want them to or not. And, in markets that are trading in a narrow up and down range (range bound). knowing when to be in the market and when to be on the sidelines makes your task even more difficult.

My two cents worth after years in the marketplace.

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