Margin Lending

A Margin Loan is a facility that allows you to borrow money which you use, in addition to your own money, to invest in various acceptable investments including:

 

  • Listed securities such as shares and exchange traded funds
  • Managed funds
  • Cash deposits and other assets

In the right hands, investment lending is a powerful tool for diversifying your assets and accelerating wealth creation. The faster you go, however, the greater the risk. That's why Ord Minnett offers a total Margin Lending strategy, advising you on how much to gear, when to gear and what to invest in.

Key features of Ords Margin Lending Programme

  • Third party securities accepted
  • Securities held in your own name
  • No establishment or account keeping fees for individuals
  • Prepaid fixed and variable interest rates available
  • Individual account management
  • Monthly statements
  • Internet access to your loan and portfolio details.

Benefits of Margin Lending

Increase the amount you have available to invest

Borrowing to acquire an asset is called gearing or leverage. The net return on an investment includes growth in its value plus distributions less transaction costs and taxes. If, over your planned investment horizon, the net return on your investment exceeds your borrowing costs then by borrowing to invest you will generally earn a higher after-tax return than if you had invested without borrowing. 

 

Diversify an existing portfolio without selling

You may be able to borrow against a portfolio of Acceptable Investments that you already own. You can then use the borrowed money to acquire other investments without selling your existing portfolio. These investments may be in a different range of asset classes, industries and companies. Investing in a range of different assets is called diversification and it is a financial technique that may reduce the risks associated with investing. 

 

Manage your investments with the help of a flexible facility

There is no set date to repay the money you borrow although events may occur that result in your loan becoming due for payment in a very short period. The Ords Margin Loan Facility has a number of flexible features which your Adviser can discuss with you. 

Contact an Adviser

Margin Lending is more complex than a traditional loan and carries a higher level of risk, so suitable is suitable for dedicated investors who actively monitor and manage their investments.

 

To obtain further information on the benefits, list of acceptable investments and the product suite available, contact an Ord Minnett Adviser today.

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