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Interested in equities investment? Check out December's top personal loans

Peter Terlato avatar
Peter Terlato
- 4 min read
Interested in equities investment? Check out December's top personal loans

Are you looking for a loan to invest in shares? If you can cover the repayments, you may want to consider a personal investment loan to purchase equities on the Australian Securities Exchange (ASX).

The latest lending indicators from the Australian Bureau of Statistics (ABS) revealed that the value of new loan commitments for fixed term personal finance for fixed term personal finance fell slightly (-0.5 per cent) in October, following a decline (-5.2 per cent) in September.

Commitments for personal lending were dragged down by a drop in the purchase of road vehicles (-3.8 per cent) in October. However, lending for personal investment jumped significantly (8.3 per cent) over the same period.

Personal loans to invest in shares

Comparing a range of margin loans - also known as a personal investment loan - could be helpful to start you on your investment journey. Margin loans offer a way to invest in the stock market by borrowing money from a lender.

While margin loans function much like personal loans or lines of credit, where you pay interest on the money you borrow, there are some differences. Margin lenders often limit how much money you can borrow compared to the value of the shares in your portfolio - this is the Loan to Value Ratio (LVR) and it measures your risk capacity.

With a margin loan you generally don’t pay down your debt, provided you maintain the agreed level of equity in your account. With this type of loan, you often only need to pay the interest on the amount of money you use to invest.

You can choose between fixed and variable interest rates when taking out a margin loan.

Whether you intend on using the money you borrow to purchase blue chip shares, or you're interested in green exchange-traded funds (ETFs) it’s important to understand that investing in the share market can be risky, so be sure to do plenty of research before committing to any loans and equities investments.

How to find the right personal loan for your investment

Margin loans tend to be quite complex, detailed and risky loans, so before you decide to apply for one, you should make sure you fully understand everything about them.

Ask yourself the following questions and if you are not sure of the answers, ask your lender, accountant or financial adviser for more information before taking the leap:

  • What are the risks involved with taking out a margin loan?
  • Do you understand how margin loans work?
  • Are there any tax implications that you can benefit from?
  • What is the risk of negative equity occurring?
  • Will you own the shares you’ll buy? If not, who does?
  • What happens if the market falls?
  • Is there any way that you can protect your investment from potential losses?

If you're seeking a personal loan with repayments that fit your budget, RateCity's personal loans calculator can provide you with an estimate to help find one that's right for you.

RateCity has ranked the top-rated personal loans on our Personal Loans Leaderboard using our comprehensive, game-changing Real Time Ratings™ system. This system gives loan products a score out of five, based on cost and flexibility. Unlike other ratings systems that rank their products once or twice a year, our Real Time Ratings™ system ranks products live as you use the site, helping you narrow down your shortlist of personal loan options.

Rankings are correct at the time of publishing. Please note lenders may trade places on the list as interest rates and fees change and RateCity’s tracker reflects these movements.

Compare top-rated excellent credit personal loans


ANZ Variable Margin Loan

Margin Loan

Minimum amount of $20,000. Buffer margin of 5% for shares and funds. Average LVR shares and funds is 59% and 72% respectively. Instalment gearing and options trading available.

Variable rate margin loan for investment in over 1000 approved shares, as well as hundreds of retail and wholesale funds.


CommSec Margin Loan Variable

Margin Loan

Buffer margin of 5%. Maximum gearing ratio of 90%.

Variable rate margin loan for investment in over 1000 approved shares.


NAB Margin Loan Variable < $250k

Margin Loan

Buffer margin of 5% for shares and 10% for managed funds. Typical LVRs 40-80%. Capitalisation of loan interest and instalment gearing allowed.

Access 2,500+ approved investments - includes ASX listed shares, ETFs, international listed shares and unlisted managed funds.


Westpac Online Investing Variable

Margin Loan

Variable rate margin loan for a range of investment solutions.

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Product database updated 23 Jul, 2024

This article was reviewed by Personal Finance Editor Alex Ritchie before it was published as part of RateCity's Fact Check process.

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