In finance, "margin" refers to the difference between the selling price of a product and the cost of producing it. This concept is crucial for businesses as it helps determine profitability. A higher margin indicates that a company retains more profit from each sale, while a lower margin suggests less profitability. In trading, "margin" also refers to the funds required to open and maintain a leveraged position. Traders borrow money from a broker to increase their potential returns. However, using margin can amplify both gains and losses, making it a risky strategy for investors in markets like stocks or forex.