margin

noun
mar·​gin | \ ˈmär-jən How to pronounce margin (audio) \

Definition of margin

 (Entry 1 of 2)

1 : the part of a page or sheet outside the main body of printed or written matter
2 : the outside limit and adjoining surface of something : edge at the margin of the woods continental margin
3a : a spare amount or measure or degree allowed or given for contingencies or special situations left no margin for error
b(1) : a bare minimum below which or an extreme limit beyond which something becomes impossible or is no longer desirable on the margin of good taste
(2) : the limit below which economic activity cannot be continued under normal conditions
c : an area, state, or condition excluded from or existing outside the mainstream the margins of critical discourse— Barbara L. Packer living in society's margins
4a : the difference which exists between net sales and the cost of merchandise sold and from which expenses are usually met or profit derived
b : the excess market value of collateral over the face of a loan
c(1) : cash or collateral that is deposited by a client with a commodity or securities broker to protect the broker from loss on a contract
(2) : the client's equity in securities bought with the aid of credit obtained specifically (as from a broker) for that purpose
d : a range about a specified figure within which a purchase is to be made
5 : measure or degree of difference the bill passed by a one-vote margin

margin

verb
margined; margining; margins

Definition of margin (Entry 2 of 2)

transitive verb

1a : to provide with an edging or border
b : to form a margin to : border
2a : to add margin to margin up an account
b(1) : to use as margin margin bonds to buy stock
(2) : to provide margin for margin a transaction
c : to buy (securities) on margin

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Other Words from margin

Noun

margined \ -​jənd How to pronounce margined (audio) \ adjective

Examples of margin in a Sentence

Noun

Please write your name in the left margin of the page. a book with wide margins Mountains lie at the city's northern margins.

Verb

the riverbed is margined by a flat beach of smooth rocks
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Recent Examples on the Web: Noun

Scripps explains that this combo doesn't exactly equate to a very hefty profit margin in the long run, even though Faith Hill and Lisa Erspamer of the Oprah Winfrey Show have spots on the production team. Blair Donovan, Country Living, "Kellie Pickler's Talk Show 'Pickler & Ben' Is Getting Cancelled and Fans Are Devastated," 13 Apr. 2019 As the movie's budget was a modest $36 million, that's a huge profit margin. Amy Mackelden, Harper's BAZAAR, "Bradley Cooper's Net Worth Will Make Your Jaw Drop," 31 Mar. 2019 The survey of 696 likely Hispanic voters has a margin of error of plus or minus 3.8 percentage points. Anthony Man, Sun-Sentinel.com, "Rick Scott leads Bill Nelson in poll of South Florida Hispanic voters," 12 July 2018 Treating data as labour means tech giants’ profit margins are likely to get squeezed, but their overall business may get bigger. The Economist, "What if people were paid for their data?," 7 July 2018 Right now, Tesla is only making performance-focused versions with higher profit margins that start at $49,000 and top out at $74,000. Jack Stewart, WIRED, "Tesla Finally Hits Its Model 3 Goal—And Immediately Ups the Ante," 2 July 2018 Profit margins are tiny, so only a handful of companies make them, and none can dramatically increase production when a rival stops manufacturing. Washington Post, "US hospitals grapple with prolonged injected opioid shortage," 27 June 2018 No constituency is more responsible for the president’s election than white Evangelical Christians, who backed Trump over Clinton by a margin of 81 to 16 percent. Eric Levitz, Daily Intelligencer, "The Fate of Abortion Rights in America May Now Lie With These Senators," 27 June 2018 Yet the White House mishandling of an excellent nominee for the Ninth Circuit Court of Appeals shows the narrow margin for political error. The Editorial Board, WSJ, "A Ninth Circuit Test for the White House," 29 Mar. 2019

These example sentences are selected automatically from various online news sources to reflect current usage of the word 'margin.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.

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First Known Use of margin

Noun

14th century, in the meaning defined at sense 1

Verb

1715, in the meaning defined at sense 1a

History and Etymology for margin

Noun

Middle English, from Anglo-French, from Latin margin-, margo border — more at mark

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Statistics for margin

Last Updated

19 Apr 2019

Look-up Popularity

Time Traveler for margin

The first known use of margin was in the 14th century

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More Definitions for margin

margin

noun

Financial Definition of margin

What It Is

The term margin has two main definitions. The first refers to the ratio of profit to revenue. The second refers to money borrowed from a brokerage firm in order to leverage an investment.

How It Works

Margin as a Financial Ratio
Let's assume Company XYZ records $1 million in net income for 2008 and $10 million in sales. By using the formula described above, we can calculate that Company XYZ has a $1,000,000/$10,000,000 = 10% net profit margin. We can determine from this number that XYZ keeps 10% of the revenue it generates or for every $1 XYZ generates in revenue, it keeps $0.10 in profit.

Borrowing Money on Margin
Let's assume you have $2,500 and Company XYZ trades at $5 a share. In a regular brokerage account, you would be able to purchase 500 shares. If XYZ were to appreciate by $10, you would make $5,000 and earn a respectable 200% gain.

But with a margin account, you could essentially borrow money from the brokerage firm and collateralize the loan with the Company XYZ shares. Margin requirements for equities are normally 2 to 1 for the average investor, meaning you purchase double what your cash balance is.

With the $2,500 from the previous example, an investor with a margin account would be able to purchase $5,000 of Company XYZ or 1,000 shares. That same $10 price move would mean you now make $10,000 and earn a 300% return.

But margin is a double-edged sword, and losses are also magnified. Additionally, if the investor's equity in the account drops past a certain point, say 25% of the total purchase amount (called the maintenance margin), the brokerage firm may make a margin call, meaning that within a few days you must deposit more cash or sell some of the shares to offset all or part of the difference between the actual stock price and the maintenance margin.

Why It Matters

Financial Ratio
Margins measure efficiency. The higher the operating margin, the more profitable per dollar received a company's core business is.

Several things can affect operating margin (such as pricing strategy, prices for raw materials, or labor costs), but because these items directly relate to the day-to-day decisions managers make, operating margin is also a measure of managerial flexibility and competency.

It is also important to note that some industries have higher labor or materials costs than others. This is why comparing operating margins is generally most meaningful among companies within the same industry, and the definition of a "high" or "low" ratio should be made within this context

Borrowing Money on Margin
Margin accounts allow investors to make investments with their brokers' money. They act as leverage and can thus magnify and gains. But they can also magnify losses, and in some cases, a brokerage firm can sell an investor's securities without notification or even sue if the investor does not fulfill a margin call. For these reasons, margin accounts are generally for more sophisticated investors who understand and can handle the risks involved.

Source: Investing Answers

margin

noun

English Language Learners Definition of margin

: the part of a page that is above, below, or to the side of the printed part
: the place where something (such as a piece of land) stops : the edge of something
: an extra amount of something (such as time or space) that can be used if it is needed

margin

noun
mar·​gin | \ ˈmär-jən How to pronounce margin (audio) \

Kids Definition of margin

1 : the part of a page or sheet outside the main body of print or writing
2 : border entry 1 sense 2 We walked along the margins of the forest.
3 : an extra amount (as of time or money) allowed for use if needed We have a margin of five minutes before the bus leaves.
4 : a measurement of difference They lost by a small margin.

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margin

noun
mar·​gin | \ ˈmär-jən How to pronounce margin (audio) \

Medical Definition of margin

1 : the outside limit or edge of something (as a bodily part or a wound)
2 : the part of consciousness at a particular moment that is felt only vaguely and dimly

margin

noun
mar·​gin | \ ˈmär-jən How to pronounce margin (audio) \

Legal Definition of margin

1 : the difference between net sales and the cost of the merchandise sold from which expenses are usually met or profits derived
2 : the amount by which the market value of collateral is greater than the face value of a loan
3a : cash or collateral deposited in a regulated amount by a client with a broker who is financing the purchase of securities — see also regulation t
b : a deposit made with a broker by a client who is trading in futures

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Comments on margin

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