Securities that are carried by a broker for the account of a customer in a margin account and in any other account that allow partial borrowing of funds from broker-dealers. These securities, and any money balances held in a margin account are used as collateral to purchase additional securities. A margin account is a type of brokerage account in which a broker-dealer lends a customer an amount of money, using the account as collateral, to finance purchases of additional securities.

In a cash account, a customer (accountholder) cannot borrow funds from the broker-dealer to pay for transactions in the account.