Blog/Website:Allenoe @ tradeSignum
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Allenoe is a member since 13-Nov-2006.

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[OTHERS] margin financing

Buying reit on margin...hmm, I never buy reit so far. Anyway, The plan will lock your money for quite a long time because you can only see decent profit after two or more years. You got the chance to get capital appreciation but also having same chance to go the other way round. BLR and REIT Dividen are not constant. You cannot be certain it will works in your favour all the time. So, I guess i will agree with Xiaosong, margin financing is more for short term trading.
18-Nov-2010 11:00 AM

[OTHERS] margin financing

Hi Icslam2000 I use Public Bank since day 1. Current margin at BLR -1% I heard OSK is around 8% In general, Margin Acc give 2.5times your balance in the account to buy shares and 1.5times of shares value you held in the account. The advantage is you only pay interest if you use the margin. The interest is deducted after you sell your shares. If you held your shares for long time, interest will accumulate until margin call. That is quite unlikely to happen. For personal loan - you pay interest until you fully settle it. FYI, i use personal loan + margin acc to trades. Extremely dangerous and risky but good leverage. But, touchwood, so far so good for me :)
13-Nov-2010 2:07 PM

[OTHERS] margin financing

Just sharing my view... Personal loan charge interest until you make full settlement. Margin account only charge interest when you use it. Q1: Yes, you will be charged with interest for the extra 75K you used until either you bank in 75K or you sell 75% of your stock. Q2: Margin call!!! Top up or sell Q3: Nothing happen. Your net worth will be 12.5K Q4: Depending on the margin provider. There is a rule for the ratio between amount you borrow against share value. Normally, if the ratio exceed 70% - margin call. Q5: Same as Q4. Q6: Margin acc count interest on a daily basis. Hope this help... I love margin :)
2-Nov-2010 7:32 PM
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