What is the term for purchasing stocks by borrowing some of the purchase costs from a brokerage firm?

The term for purchasing stocks by borrowing some of the purchase costs from a brokerage firm is "Buying Stock on Margin." This concept refers to the use of borrowed funds to increase the potential return on investment. When an investor buys on margin, they pay a portion of the stock's price, while the brokerage lends them the remainder. This allows the investor to control a larger position than they would be able to with just their own funds.

Margin trading amplifies both potential profits and potential losses, which requires careful consideration and understanding of the associated risks. If the value of the stocks decreases, the investor still owes the borrowed amount, which can lead to significant financial repercussions. Thus, this method is typically advised for those with substantial knowledge and experience in trading, highlighting the importance of understanding the mechanics behind margin accounts.