Margin refers to the difference between the cost of producing a product and its selling price. It is often expressed as a percentage and indicates how much profit a business makes on each sale. A higher margin means more profit, while a lower margin suggests less profitability. In finance, margin can also refer to the amount of money borrowed from a broker to purchase securities. This allows investors to buy more shares than they could with just their own funds. However, trading on margin involves higher risk, as losses can exceed the initial investment.