Margin Loan Calculator
Calculate margin loan interest, borrowing costs, investment profit or loss, return on equity, and your estimated margin-call price.
All amounts are in US dollars. Results are estimates based on your inputs.
Your Margin Loan Results
The estimated margin-call price includes accrued unpaid interest at the end of the selected holding period. It is a projected maintenance threshold, not a prediction of when your broker will issue a call.
Detailed Calculation Breakdown
This table shows the values used to calculate your investment’s borrowing costs and projected equity.
| Calculation | Result |
|---|---|
| Total Shares | — |
| Purchase Price per Share | — |
| Original Investment Value | — |
| Original Loan Balance | — |
| Your Initial Cash | — |
| Annual Interest Rate | — |
| Loan Duration | — |
| Interest Day-Count Basis | — |
| Daily Interest | — |
| Total Accrued Interest | — |
| Projected Loan Balance Including Interest | — |
| Projected Market Value | — |
| Required Maintenance Equity | — |
| Projected Equity | — |
| Maintenance Equity Surplus / Shortfall | — |
| Stock Price Gain / Loss | — |
| Interest Expense | — |
| Net Profit / Loss | — |
How to Use the Margin Loan Calculator
Enter the number of shares and purchase price to calculate your total investment value. Then enter the amount borrowed from your brokerage and the annual interest rate.
Specify the number of days you expect to hold the loan. Enter an expected future share price to estimate your investment’s profit or loss.
Finally, enter your brokerage’s maintenance margin requirement and choose the appropriate interest day-count convention.
Click Calculate to see your estimated interest, projected equity, return on cash, and margin-call price.
Margin Loan Interest Formula
Convert the annual interest rate into decimal form before applying the formula.
For example, borrowing $5,000 at 10% annual interest for 30 days produces $41.67 of estimated simple interest using a 360-day year.
Actual brokerage charges may differ because rates can change, loan balances can fluctuate, and brokers may post or compound interest differently.
How to Calculate a Margin-Call Price
This simplified formula estimates the stock price at which the equity ratio equals your selected maintenance requirement.
It assumes a single long stock position, constant maintenance requirements, and no additional account assets or liabilities.
How to Calculate Return on Equity
The calculation includes the estimated margin interest expense. It excludes trading commissions, taxes, dividends, and other unentered expenses or income.
Important Risks of Margin Borrowing
Margin borrowing increases purchasing power but also magnifies investment losses. A falling share price may reduce your account equity and trigger a maintenance margin deficiency.
Brokerages may impose higher maintenance requirements, change those requirements, or liquidate securities without giving you an opportunity to choose which positions are sold.
You may also owe additional money if liquidation proceeds do not cover the outstanding loan and related charges.
Frequently Asked Questions
What is a margin loan?
A margin loan is money borrowed from a brokerage using eligible securities as collateral. It allows you to purchase investments with a combination of borrowed money and your own funds.
How is margin loan interest calculated?
Interest generally depends on your loan balance, annual interest rate, borrowing duration, and the brokerage’s day-count and posting methods.
What is a maintenance margin?
Maintenance margin is the minimum account equity your brokerage requires relative to the market value of the securities. Requirements vary by broker, security, and account circumstances.
What is a margin call?
A margin call generally occurs when account equity falls below a required threshold. Your brokerage may require additional collateral or liquidate investments.
Can margin loan interest rates change?
Yes. Brokerage margin rates may be variable. A change in your borrowing rate can increase or decrease your actual interest expense.
Does this calculator include compound interest?
No. It estimates simple interest using a constant loan balance and interest rate. For the projected maintenance calculation, accumulated unpaid interest is included in the outstanding debt.
Can I lose more than my initial investment?
Yes. A substantial decline in the value of securities purchased on margin can result in losses greater than your initial cash contribution.
Does paying margin interest affect investment returns?
Yes. Interest is a financing expense that reduces your net investment profit and return on your initial cash investment.
Does this calculator predict actual margin calls?
No. The displayed price is a simplified estimated maintenance threshold. Actual account-level margin calculations depend on your broker’s rules, portfolio holdings, other balances, and changing requirements.
Are brokerage commissions and taxes included?
No. The calculator excludes trading commissions, taxes, dividends, and other charges. Include those separately when evaluating your actual investment performance.