With a fully paid common stock position and no leverage, the share value can generally fall to zero, limiting the direct position loss to the amount invested. Margin borrowing, short selling, options, and other leveraged arrangements can create different or larger losses.
Detailed explanation
With a fully paid common stock position and no leverage, the share value can generally fall to zero, limiting the direct position loss to the amount invested. Margin borrowing, short selling, options, and other leveraged arrangements can create different or larger losses.
The exact outcome depends on account structure, security type, jurisdiction, contractual terms, and the facts of the situation. This page provides general education rather than personalized financial, tax, or legal advice.