Recently, I opened a margin financing account with my stockbroking company, on top of my normal trading account with them. Before I opened this account, I did some research and identified a few benefits for me. Thought I will share it here with you in case you see the same benefits and opportunities …

In a nutshell, a margin financing account is like having a credit line provided by stockbroking firm to us to finance the purchase of securities/stocks. However, we will have to pledge either cash and/or “marginable” securities as collateral. Take for example, Maybank Kim Eng, from its website, through this means, we can get financing of up to 3.5 times the amount of cash pledged, or up to 2.5 times the amount of securities pledged. Hence, we are technically borrowing money to invest to get a higher yield => “blink” “blink” => its HIGH RISK !!!!

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