What is a Margin Call?

A margin call is a mandatory request by the custodian/broker for the account holder to add equity to the account, either by depositing cash or selling securities to raise cash.

When an investor takes an account on margin, the custodian will require that they keep a certain amount of equity/cash in the account to maintenance the borrowed amount. If the account value drops past a certain level, the custodian may require the investor to add equity to the account to cover the margin balance.

What is 'Buying on Margin' and Margin Trading?
What is Minimum Margin?
What Does Maintenance Margin Mean?