When you have stocks, brokers will let you take a margin loan of at least 50% or more of your equity value. This gives you at least 1.5 leverage, at the cost of margin loan interest, which is usually terrible at most brokerages. For example, Schwab will charge you 13% interest as of today (June 2025). If you cannot make more than 13% on the investments you do with leverage, you won't even break even. Interactive Brokers will give you a much better rate, for example 5%. This is an easier number to beat on investment return. It must have been nice during the [ZIRP](https://en.wikipedia.org/wiki/Zero_interest-rate_policy) era, but those days are gone for now.
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When you have stocks, brokers will let you take a margin loan of at least 50% or more of your equity value. This gives you at least 1.5 leverage, at the cost of margin loan interest, which is usually terrible at most brokerages. For example, Schwab will charge you 13% interest as of today (June 2025). If you cannot make more than 13% on the investments you do with leverage, you won't even break even. Interactive Brokers will give you a much better rate, for example 5%. This is an easier number to beat on investment return.
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This type of leverage is the simplest to use and understand. The broker will let you buy stocks without cash, making your cash balance negative, and charging daily interest on it. You can pay it back whenever you want, and your broker will prefer you pay it back later so they can keep charging you interest.