Margin facility

[billions]

Originally Posted by knightofdelta

I totally agree with Zainab on this issue. It is better to take a loan that will be deducted from the salary than to use one's portfolio as a collateral. The market is presently yielding about -3%. The banks charge about 25% with all those little fees they insert here and there. If the stock market does not yield more than 30%, then one will not be able to break even after considering brokers' fees.

I shy away from margin trading, at least for now. Maybe when I have the financial muscle, I will dabble into it.

I think d most important thing is not to bite more than u can chew and to go for the option with d best interest.

l remember going to a bank last yr and was told dat the interest is abt 18%(after all d other charges) but my share certificate would be used as a collateral.

[emmanuel ewumi]

Thank God for the clarification from CBN,the embargo on margin had been lifted.Just got a facility,am waiting for the coast to become clearer before taking full plunge.Since l have not drawn down out of the facility there is no interest to be paid.

[billions]

Originally Posted by emmanuel ewumi

Thank God for the clarification from CBN,the embargo on margin had been lifted.Just got a facility,am waiting for the coast to become clearer before taking full plunge.Since l have not drawn down out of the facility there is no interest to be paid.

Great news!

The market is stabilizing....wish u well.

[emmanuel ewumi]

Where can l get brokers who can arrange margin facilities of N1 to N4 million.
l need this information on behalf of my clients,since most of the brokers l know wont give anything less than N5 million.

[billions]

Originally Posted by emmanuel ewumi

Where can l get brokers who can arrange margin facilities of N1 to N4 million.
l need this information on behalf of my clients,since most of the brokers l know wont give anything less than N5 million.

Do u know of another bank giving margin facilities apart from FBN?

Thx.

[zainabusman]

Originally Posted by emmanuel ewumi

Where can l get brokers who can arrange margin facilities of N1 to N4 million.
l need this information on behalf of my clients,since most of the brokers l know wont give anything less than N5 million.

UBA stocbrokers give N1 million. However, i must caution against the use of margin in this market. Furthermore, the interest will be very high such that u will need to make at least 25% just to break even.

[zainabusman]

Originally Posted by billions

Do u know of another bank giving margin facilities apart from FBN?

Thx.

Most banks will give u thru their stockbroking arm. UBA stockbrokers and Zenith capital give margin facilities.

[ntom]

[quote=billions;26856]Do u know of another bank giving margin facilities apart from FBN?

Thx.[/QUOTE FIDELITY BANK WILL GIVE YOU THROUGH FUSL AT ADEOLA HOPEWELL V I AND THEY TERMS IS OKAY

[yusuff]

@NTOM
What is the term/Charges?

[emmanuel ewumi]

Originally Posted by zainabusman

Most banks will give u thru their stockbroking arm. UBA stockbrokers and Zenith capital give margin facilities.

UBA will give you a list of stocks to buy,this stocks are the highly capitalised ones .Most of the people that used the share plus of UBA stock brokers lost money.
Zenith Capital wont give any thing less than N10 million,same with IBTC and Meristem securities.

[emmanuel ewumi]

Originally Posted by billions

Do u know of another bank giving margin facilities apart from FBN?

Thx.

Most banks will give you a share purchase loan,but margin trading facility is usually channeled through their lnvestment bankiig or Stock broking subsidiary.

[emmanuel ewumi]

Originally Posted by zainabusman

UBA stocbrokers give N1 million. However, i must caution against the use of margin in this market. Furthermore, the interest will be very high such that u will need to make at least 25% just to break even.

Just target minimum of 10 percent per quater,l just made 15 percent on skye bank in 4 weeks.

[emmanuel ewumi]

Originally Posted by yusuff

@NTOM
What is the term/Charges?

New facilities are now reviewed to 22 Percent.You have 365 days to pay,
you dont need to make monthly payment.
You pay when you make your money.

[zainabusman]

Originally Posted by emmanuel ewumi

Just target minimum of 10 percent per quater,l just made 15 percent on skye bank in 4 weeks.

I hope u have taken out ur gains from Skye given its fall of late.

There is nothing wrong with margin but it is only for the astute investor. If u take a margin at 22% plus at least 3% brokers commission for both buy and sell, it means u must make 25% just to break even.

Another mistake people make is to buy too many stocks. For a margin facility it is best to buy 2 or 3 at most. For example if all u bought with ur margin was Skye bank, u will be in nice shape.

[waaan5]

Originally Posted by zainabusman

I hope u have taken out ur gains from Skye given its fall of late.

There is nothing wrong with margin but it is only for the astute investor. If u take a margin at 22% plus at least 3% brokers commission for both buy and sell, it means u must make 25% just to break even.

Another mistake people make is to buy too many stocks. For a margin facility it is best to buy 2 or 3 at most. For example if all u bought with ur margin was Skye bank, u will be in nice shape.

Zainabusman, your views are right again. The only thing I add is that one should adopt the 'sole risk' approach with margin funds (i.e choosing one or just two stock to invest) after a detailed analysis of the stock in question. I know some people who took margin to buy some insurance stocks within this time frame and the stocks have fallen more than 50%. This is in addition to the accruing interests that has to be taken care of.

[Michael]

Originally Posted by emmanuel ewumi

New facilities are now reviewed to 22 Percent.You have 365 days to pay,
you dont need to make monthly payment.
You pay when you make your money.

Who is your contact person at Fidelity and how canone get in touch