What is the simplest way to explain margin?

Here is an explanation of margin:

https://www.investopedia.com/terms/m/margin.asp

1. Assume initial margin of 50%, and your account only have $500 cash balance (no shares). That means you can buy 100 shares at $10 each, you pay $500 from your cash balance and borrow $500 from broker to pay for the shares.

When your shares grow to $20 and you sell the shares, you receive $2000, then return $500 and interests to broker. Your account now have $1500 (net off margin interests) in cash balance.

2. Margin call will happen when your equity drop below maintenance margin. Assume maintenance margin of 30%.

At the time you bought the 100 shares at $10, your share value is $1000 and margin loan $500, i.e. your equity is $500, 50% of your share value. No margin call.

Lets say your shares drop to $7, your share value drop to $700, your equity would be $700 - $500 = $200, which is $200/$700 = 28.6%. You will get a margin call as your equity has dropped below maintenance margin of 30%. You either have to top up cash into your account or sell your shares (can be partially) to keep the maintenance margin.

As you can see, it is rather complicated to keep track of your margin level with multiple stock holdings. You will need the trading platforms to provide such info and you need to have a detailed trading plan to manage your portfolio.