Skip header Skip to main content
Piggy bank and coins in the foreground, and a person working at their home office in the background.

Cash & Margin Accounts: An Overview

Investment cash accounts and margin accounts are non-registered accounts that can help you, a group of people or an organization reach an investing goal. Unlike registered accounts, in non-registered accounts you have to pay tax on the growth of your investments (capital gains, dividends and interest) when they they are sold.

With an investment cash account, you use your own cash to pay for the securities you want to buy. A margin account, on the other hand, lets you borrow money against the investments in your account to buy securities.

Investment cash and margin accounts allow investors to:

  • Hold a diversified portfolio and choose from a wide array of investments – stocks, exchange-traded funds (ETFs), options, mutual funds, GICs, money-market investments, bonds and more
  • Access North American exchanges and over-the-counter markets
  • Save for shorter-term goals, such as a major purchase, or supplement a longer-term goal like retirement

Good to know:

  • You can designate someone to place orders on your behalf, if you wish
  • Accounts can be held individually or jointly

Investment cash accounts do not automatically allow you to trade options or trade on margin. If interested, you'll need to apply for a margin account or an options-enabled account. You can also choose to add these features to an existing account.

Leveraging investments may appear attractive, but you must be aware of the implications if the market conditions change from when you originally used your investment(s) to calculate your margin loan value. You could be faced with increased monthly loan payments due to increased interest rates, or a possible margin call if your account becomes under-margined due to a drop in market prices.

Find out more about margin in Understanding Margin Accounts.

Investing Academy. Knowledge Supports Success. Visit now.

RBC Direct Investing Inc. and Royal Bank of Canada are separate corporate entities which are affiliated. RBC Direct Investing Inc. is a wholly owned subsidiary of Royal Bank of Canada and is a Member of the Investment Industry Regulatory Organization of Canada and the Canadian Investor Protection Fund. Royal Bank of Canada and certain of its issuers are related to RBC Direct Investing Inc. RBC Direct Investing Inc. does not provide investment advice or recommendations regarding the purchase or sale of any securities. Investors are responsible for their own investment decisions. RBC Direct Investing is a business name used by RBC Direct Investing Inc. ® / ™ Trademark(s) of Royal Bank of Canada. RBC and Royal Bank are registered trademarks of Royal Bank of Canada. Used under licence. © Royal Bank of Canada 2024.

Any information, opinions or views provided in this document, including hyperlinks to the RBC Direct Investing Inc. website or the websites of its affiliates or third parties, are for your general information only, and are not intended to provide legal, investment, financial, accounting, tax or other professional advice. While information presented is believed to be factual and current, its accuracy is not guaranteed and it should not be regarded as a complete analysis of the subjects discussed. All expressions of opinion reflect the judgment of the author(s) as of the date of publication and are subject to change. No endorsement of any third parties or their advice, opinions, information, products or services is expressly given or implied by RBC Direct Investing Inc. or its affiliates. You should consult with your advisor before taking any action based upon the information contained in this document.

Furthermore, the products, services and securities referred to in this publication are only available in Canada and other jurisdictions where they may be legally offered for sale. If you are not currently a resident of Canada, you should not access the information available on the RBC Direct Investing Inc. website.

> NextUnderstanding Margin Accounts

EXPLORE MORE
A wire head wearing headphones connecting last month's top traded stocks.

Top 10 Traded Stocks and ETFs in March 2024

Here's what RBC Direct Investing clients traded and added to watchlists in March.

A wire head wearing a hat connecting last month's top traded stocks.

Top 10 Traded Stocks and ETFs in February 2024

Here's what RBC Direct Investing clients traded and added to watchlists in February.

Two hands holding up a clock

Be Strategic: 5 Things to Keep in Mind When Investing

From watching your emotions to the impacts of inflation to asset allocation, here are a few considerations when you invest.

Inspired Investor

Inspired Investor brings you personal stories, timely information and expert insights to empower your investment decisions. Visit About Us to find out more.