Log into your brokerage account, hit a few buttons, and now you can buy 50% more of the same stock you think is going to go up and make you a tidy profit, using the brokerages money. Simple and sweet, no?
Well, maybe simple. But sweet? We at A. B. Nicholas Securities Finance beg to differ.
Your margin loan is based on that single stock. It goes down, you have a margin call. Now you have to sell some stock or come up with money. And there’s nobody to talk to about it — it is all computer generated and immediate. So you darned well better guess right. There’s nobody to talk to if you don’t.
Your margin loan maxes out at 50% and that’s it. Even if it is the most solid stock on the market, with ten years of solid, steady growth behind it … no matter. You get 50% to play with.
And how do you “play” with it? Well, your options are one: Buy more of the same stock. That’s it. Your conventional margin loan is … well, a conventional margin loan. No custom features. No extra leeway. Nothing.
Let’s look at why a LeverageLine can make much more sense for you.
FIrst, your entire portfolio is averaged together to arrive at your securities’ value for lending purposes. That means no one stock, unless it dominates the entire portfolio, will determine your collateral value. One stock can go down, another can go up — but it won’t have any dire effect on your portfolio in most cases.
Second, you can forget about being limited to a 50% loan-to-value. Depending on the collateral quality in your free-trading securities portfolio, you can obtain a loan at up to 96% of the value of your portfolio. That’s almost double what a margin loan can give you.
Third, your LeverageLine is not staid and constrained by convention. We’ve built in features like freedom to defer your repayment and priority consideration for conventional business or personal financing when you begin with your asset-based line of credit our way — and all that provided by one of four major, household-name, fully licensed major public institutions and licensed FINRA-member advisors.
There’s so much more that we offer here at A. B. Nicholas. Come on over and apply for free and let us show you the difference. The huge difference.