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Margin Lending Loans


RateCity Staff

By RateCity Staff

1 min read

Margin lending loans allow you to borrow money to invest in shares and managed funds. Your investment is held as security for the loan, which allows you to make bigger investments than you could normally afford.

Benefits
When you have more money to invest, your gains are magnified in the case that your portfolio rises in value, giving you higher profits than you could achieve without the borrowed cash. Using margin lending loans to fund your share investments can also give you tax incentives.

Risks
When your shares lose value, the losses you make will also be magnified, which add on to the loan that you already need to repay. When the value of your investment portfolio begins to fall below your loan amount, you run the risk of negative equity, which is the risk of having to repay more money than you borrowed. Margin loans may suit you if you are comfortable with a healthy level of risk, due to the often unpredictable movements of share prices.

Visit our margin lending loans comparison page to discover some of the best products and most affordable features to make your investment work for you.

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