Americans are now borrowing more to bet on stocks than they owe in credit card debt

Americans are now borrowing more to bet on stocks than they owe in credit card debt

Eric Esposito

Sun, August 16, 2026 at 2:30 PM GMT+3 5 min read

More Americans are magnifying their stock market gains — and pains — with borrowed money.

Data from the Financial Industry Regulatory Authority (FINRA) shows that the debit balances in U.S. customers' securities margin accounts topped $1.5 trillion as of June 2026. By comparison, U.S. credit card debt is $1.26 trillion, according to the Federal Reserve Bank of New York.

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Margin trading is essentially investing with borrowed money. Instead of using cash in your brokerage account, investors borrow additional funds from their broker to buy more stocks.​

And judging by FINRA's prior numbers, there's no sign of this trend slowing down. In fact, the $1.5 trillion figure in June is up 7.9% from May. In June 2025, FINRA showed margin debt was roughly $1 trillion, meaning margin accounts rose by about 50% within one year.

Moneywise reached out to FINRA for further comment and it clarified that these margin numbers encompass "any person whose funds or securities are held by a broker-dealer on their behalf," which includes individual and institutional investors, investment funds, corporations and businesses, and trusts and estates.

As the overall market continues its bullish trend, using margin seems like the obvious move. Depending on how much someone borrowed, their positions could be up double, triple, or more versus the actual market gain.

The trouble is that when there's a big enough dip, brokers send out "margin calls" to collect their cash. At this point, there isn't enough money in a trader's balance to cover a borrowed stock position. Traders have to add cash quickly — otherwise, they'll lose everything in a liquidation.

​Why is margin trading going mainstream?

​The obvious catalyst for these crazy margin numbers is the current stock market bull run. Largely fueled by AI, benchmark indices like the S&P 500 and Nasdaq-100 have been on a tear, rising about 13% and 18% year-to-date, respectively.

​But there have also been a few other shifts that have helped normalize margin trading.

​For example, the SEC approved the first single-stock leveraged ETFs in 2022. Traders can easily buy and sell these shares as they would other ETFs. The difference is that leveraged ETFs have the same volatility boost you get when borrowing funds to trade.

​Jurrien Timmer, director of global macro at Fidelity Investments, isn't a fan of these new products. In an interview with NPR, Timmer described leveraged ETFs as "weapons of self-destruction" and couldn't understand "why regulators approve these things."

​Timmer was specifically referring to the extreme swings that leveraged single-stock ETFs brought into the South Korean market.

​The popularity of these leveraged products was a primary reason behind the wild price action in the Korea Composite Stock Price Index (KOSPI) over the past year. On one trading day in July, Reuters reported that 1.2 million Korean adults faced margin calls as the stocks for these companies dipped.

​Globally, Bloomberg's data suggests the total value in these leveraged single-stock funds is now at $250 billion.

​Peter Atwater, president of Financial Insyghts, told Bloomberg such an increase in demand for these products "suggests bullish investors feel all but invulnerable" in the current market environment.

​Beyond these popular products, there's a recent legal change in the U.S. that has made it easier for traders with smaller accounts to take on larger positions.

​As of June 4, 2026, FINRA and the SEC announced that traders don't face the old "pattern-day trading" requirement for making more than four day trades within a rolling five-business-day window. Before, traders had to maintain a $25K account to make these trades. Today, they just have to cover their margin requirements.

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​Is it ever safe to buy on margin?

​In reaction to all this margin mania, many financial gurus have been cautioning the public to steer clear. For instance, CNBC's Jim Cramer recently told his viewers, "If you're on margin, get off it. I no longer feel that you'll get out alive."

​For most retail investors, that's sound advice.

​But considering the current mountain of margin debt, it's clear many traders aren't listening.

​For those who are still seriously considering margin trading, the only "safe" way to do so is with plenty of planning.

​At minimum, you have to be honest about the possibility of losing all your money in one of these positions. You also need to know the interest percentage on your loan and how low a stock could fall before you get a margin call.

​You might also want to look into automated "stop loss orders" that sell your margin positions at a predefined loss level so you avoid liquidation.

​The only way to truly play it safe, however, is to pretend that margin doesn't exist.

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This article originally appeared on Moneywise.com under the title: Americans are now borrowing more to bet on stocks than they owe in credit card debt

This article provides information only and should not be construed as advice. It is provided without warranty of any kind.