LEVERAGED EQUITIES
Margin lending specialist Leveraged Equities has been named Margin Lender of the Year. A subsidiary of Bendigo and Adelaide Bank, Leveraged is not only one of the longest-running players in the market, it’s also one of the most decorated, having taken out the top Margin Lender of the Year prize for three consecutive years now.
Leveraged was recognised as being a leader in the margin lending space once again, thanks, in part, to features like its expansive list of 3000 approved investment products (including shares, exchange traded funds and unlisted managed funds) and its ability to provide a sweet spot for borrowers when it comes to gearing capacity.
The variable interest rates on Leveraged’s margin loan currently start at 6.70%pa, while its direct investment loan comes with rates from 4.34%pa.
“It is great to see the hard work we put in to continually improving our product and service offerings to partners and customers paying off,” says the head of Leveraged, Lily Elliott.
“As the Money magazine Margin Lender of the Year award winner for the past three years in a row, Leveraged has demonstrated why it is the professional’s choice. We have excellent connectivity with the major investment platforms and stockbrokers and offer a wide range of gearing solutions.”
As all investors will know, 2022 has proven to be a turbulent year for the markets so far, but this hasn’t translated into any decline in appetite for Leveraged’s loans. Elliott says the business has also noticed a growing amount of interest from younger customers in the under 35-year-old bracket.
“We have seen a strong and sustained increase in demand for margin lending over the past few years (including through the pandemic). However, there has been little or no drop-off in demand despite recent volatility in global markets.
“The reason for this is simple – most Leveraged customers invest for the long term (more than 10 years) and use gearing as part of a strategy to achieve financial goals, like owning a house, growing their wealth for retirement, or to leave a legacy. Their need for gearing as a wealth-building strategy doesn’t change much when the market fluctuates. If anything, lower stock prices are generally better for investors aiming to purchase investments they believe are undervalued.”
That’s not to say that there aren’t risks involved with gearing, though – risks that Elliott cautions investors to recognise before starting out.
“It’s important to be aware that borrowing to invest is a high-risk strategy, and while it can magnify an investor’s gains in a rising market, it can also magnify their losses in a falling market. It’s ideal to have a stable source of income and cashflow to service your borrowings when using a gearing strategy.”
The Commonwealth Bank’s CommSec is second in the category this year, offering variable rates on its margin loan starting at 5.75%pa.
Meanwhile, brokerage platform Bell Direct rounds out the top three places. Variable rates on Bell Direct’s margin loan option currently start at 6.40%pa.