Robinhood's margin amounts depend on your account type and what you own
Robinhood offers margin — borrowed money to buy stocks — but the amount you can borrow is not fixed. It depends on three things: whether you have a standard or Gold account, what securities you hold, and how much cash you have deposited. A standard Robinhood account gives you no margin at all. A Robinhood Gold account gives you up to 2 times your buying power for stocks, which means if you deposit $5,000, you can control up to $10,000 in stock positions.
The actual margin available to you changes daily based on the value of your holdings. Robinhood calculates your buying power by taking your cash, adding the loan value of your securities (usually 50% of stock value), and subtracting any existing margin debt. If your stocks drop, your available margin shrinks immediately. If they rise, your available margin grows.
Margin is not free. Robinhood Gold costs $5 per month for the margin feature itself, plus an annual interest rate on any borrowed money. That interest rate varies — Robinhood publishes it but it changes with market conditions. You only pay interest on the amount you actually borrow, not on your total account value.
Key Takeaways
- Standard Robinhood accounts have zero margin; only Gold accounts ($5 per month) can borrow to buy stocks.
- Gold account margin is capped at 2 times your buying power for stocks, meaning a $5,000 deposit lets you control up to $10,000 in positions.
- Your available margin changes daily based on what your stocks are worth — if holdings drop, borrowing power shrinks immediately.
- You pay interest only on money you actually borrow, at an annual rate Robinhood publishes but adjusts over time.
- Margin calls happen when your account value drops below the maintenance requirement, usually 30% of borrowed amount, and Robinhood will force-sell positions to meet it.
How Robinhood calculates your buying power
Your buying power is the total amount you can spend on securities at any moment. Robinhood calculates it by adding your cash balance to the loan value of your holdings, then subtracting any margin debt you already owe. For stocks in a Gold account, the loan value is typically 50% of the current market value — meaning a $1,000 stock position can be borrowed against for $500.
Different securities have different loan values. Some stocks have 50% loan value; others have less. Options, bonds, and mutual funds have different rates. Robinhood shows your current buying power in the app under Account > Buying Power. That number updates in real time as prices move.
If you buy $10,000 worth of stock with a $5,000 deposit and 2x margin, you are borrowing $5,000. Your account now owes that debt. If the stock rises to $12,000, your buying power increases because the loan value of your position increased. If it falls to $8,000, your buying power shrinks and you may trigger a margin call.
What happens when you trigger a margin call
A margin call occurs when your account equity falls below Robinhood's maintenance requirement. For most stocks, that requirement is 30% of the borrowed amount. If you borrowed $5,000, you must maintain at least $1,500 in equity to cover it. If your account drops below that, Robinhood will force-sell your positions without asking you first.
The forced sale happens automatically and can occur during market hours or after hours. Robinhood typically sells the most liquid positions first (the easiest to convert to cash quickly). You have no control over which securities are sold. The goal is to raise enough cash to bring your account back above the maintenance threshold.
Margin calls can happen fast. A 30% drop in a concentrated position can trigger one within minutes. Once it happens, the damage is done — you have already lost money on the forced sale. The only way to avoid it is to keep enough cash in your account or reduce your borrowed amount before the call occurs.
Interest rates and fees for margin borrowing
Robinhood Gold membership costs $5 per month. That fee is separate from margin interest. On top of it, you pay annual interest on any borrowed money. Robinhood publishes its margin interest rate, but it is not a single fixed number — it varies based on how much you have borrowed and changes periodically as market conditions shift.
Interest accrues daily and is charged monthly to your account. If you borrow $5,000 at an annual rate of 10%, you would owe roughly $41.67 per month in interest (though the exact amount depends on the precise rate Robinhood is charging that month). The interest is deducted from your cash balance automatically.
You can check Robinhood's current margin interest rate in the app under Account > Margin. The rate applies to all borrowed funds in your account. If you pay back the borrowed money, the interest stops accruing on that portion immediately.
Differences between standard and Gold accounts
A standard Robinhood account has no margin at all. You can only spend the cash you have deposited. You cannot borrow to buy stocks, and there is no monthly fee. This is the simplest account type and carries no risk of a margin call.
A Robinhood Gold account costs $5 per month and gives you margin borrowing. The maximum margin is 2 times your buying power for stocks. You also get other Gold features like extended hours trading and access to research tools, but the margin is the main financial difference. Gold accounts carry the risk of margin calls and interest charges.
Switching between account types is free and can be done in the app. If you downgrade from Gold to standard, any existing margin debt must be paid back first. Robinhood will not let you carry a margin balance in a standard account.
How margin works with different types of securities
Stocks in a Gold account typically have 50% loan value, meaning you can borrow half their current market value. Some stocks have lower loan values — penny stocks and highly volatile stocks might have 25% or 0% loan value, meaning you cannot borrow against them at all. Robinhood lists the loan value for each security in the app.
Options have different margin rules. Buying options requires cash; you cannot use margin to purchase them. Selling covered calls or cash-secured puts can use margin, but the rules are more complex. Bonds and mutual funds also have their own loan values, typically lower than stocks.
Crypto on Robinhood cannot be bought on margin. You can only spend cash. This is a key difference from stocks and is worth knowing if you are considering both asset types.
Common mistakes that lead to margin calls
The most common mistake is borrowing too much relative to your account size. A 2x margin account feels like assistance programs until a 30% market drop hits. If you borrowed the maximum and the market falls 30%, you trigger a margin call immediately. Many new margin users do not account for volatility.
Another mistake is concentrating borrowed money in a single stock. If that stock drops 30%, you are in trouble. Diversification does not eliminate margin call risk, but it reduces the chance that one bad day wipes out your equity.
A third mistake is ignoring the monthly interest charge. Over a year, margin interest adds up. If you are borrowing $5,000 at 10% annual interest, that is $600 per year in costs. Many traders do not factor this into their profit calculations.
Frequently Asked Questions
Can I use margin to buy options on Robinhood?
No. You cannot use margin to purchase options. You must pay cash for every option contract you buy. You can sell covered calls or cash-secured puts using margin, but buying options requires cash only.
What is the minimum account balance to use margin on Robinhood?
There is no stated minimum, but you must have a Gold account ($5 per month) to access margin at all. The more cash you have, the more margin you can use, since margin is capped at 2 times your buying power.
Does Robinhood charge interest if I pay back borrowed money before the month ends?
Interest accrues daily, so if you pay back borrowed money mid-month, you only pay interest for the days you held the debt. The interest stops accruing the day you repay it.
What happens to my margin if my stocks are halted from trading?
If a stock is halted, its loan value typically drops to zero immediately. This can trigger a margin call if you were borrowing heavily against that position. Halts are rare but can happen without warning.
Can I lose more than my deposit if I use margin?
Yes. If your account drops below zero after a forced sale, you owe Robinhood the difference. This is rare because margin calls force-sell before accounts go deeply negative, but it is theoretically possible in extreme market moves.