Debit balance

(redirected from Debit Balances)
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Related to Debit Balances: Credit Balances

Debit balance

The amount that is owed to a broker by a margin customer for loans the customer uses to buy securities.

Debit Balance

The amount of money an investor owes on a margin loan. This is calculated as the amount the investor directly owes his/her broker. It does not account the paper profit the investor has made on various transactions. When determining the amount owed in the case of margin call, one generally uses the adjusted debit balance, which starts with the debit balance and subtracts the amount of applicable paper profit.

debit balance

The amount owed in a brokerage margin account. A debit balance occurs when an investor purchases securities on margin or borrows money from the account by using securities as collateral. Brokerage firms typically charge an interest rate on the borrowed funds that varies with the size of the debit balance. Compare credit balance. See also call loan.

Debit balance.

A debit balance is what you owe. It's entered as accounts receivable on the books of the lender and appears on your account statement as a liability.

For example, if you have a margin account and borrow money to buy stock, your monthly brokerage statement will show a debit balance for the amount of the margin loan.

References in periodicals archive ?
Each entity would be accountable for its own IHB accounts just as if they were external, and would receive interest for credit balances and pay interest for debit balances as with an external bank account.
Any customer who applies for and receives a formal overdraft while the offer is running will also pay no interest on agreed debit balances from when their overdraft is set up until April 4.
Expense and loss accounts ordinarily have debit balances.
The banks with the matching net debit balances are obligated to provide the gold.