The Mechanics
US Reg-T margin allows borrowing up to 50% of a purchase; maintenance requirements (25-40%) set the equity floor. Interest accrues daily at rates ranging from ~5% (IBKR) to 12%+ (some retail apps) — a permanent headwind your returns must outrun. Crypto and CFD platforms offer far higher leverage with faster liquidation math.
Margin Calls and Liquidation
Fall below maintenance and the broker demands cash or sells your positions — at their discretion, without consulting you on which or when. Cascades are the killer pattern: market drops, liquidations fire market-wide, prices drop further, more liquidations. In crypto perpetuals this happens in minutes. The people wiped out are those whose leverage left no room for normal volatility, converting a temporary drawdown into a permanent exit.
Using Leverage Like an Adult
If you use margin at all: keep effective leverage modest (well under 2:1 in equities), stress-test against a 30% gap move, never hold concentrated leveraged positions through binary events (earnings, FOMC), and treat margin capacity as emergency flexibility rather than default buying power. The honest question isn't 'how much can I borrow' but 'what drawdown ends me' — size from the answer.