Investing and Personal Lines of Credit

Investrade's interest rates range from 4.00% to 7.25%[1] depending on the daily average debit balance in your brokerage account.

Once a margin agreement is on file, you essentially are approved to use your credit-line when and how you choose.

Using Margin for Investment Purposes

Margin lending has advantages which include:

  • Portfolio Diversification: Leverage your increased purchasing power for new investment opportunities and diversification using your existing assets in your brokerage account as collateral.[2] With access to more capital, you have a wider range of investment choices.
  • Temporary coverage for funds due by settlement date, but not yet paid.
  • Flexible payment options as long as you maintain the required level of equity in your account. See equity requirements.
Using Margin as a Personal Line of Credit

Margin lending is a useful source for personal needs and is a ready-to-use line of credit. While the primary goal for most investors is borrowing to buy additional securities, you can also use these funds for other purposes to be used at your discretion.

  • Borrow for short-term cash needs, for reasons other than stock purchases
  • Short term cash for unexpected expenses
  • Debt consolidation or tax payments
  • Auto Financing
  • Home improvements
  • Education expenses and tuition
  • Business finances

By staying invested, you can defer any capital gains taxes that might result from selling securities to meet your financing needs.

Consider borrowing on margin if you:
  • Have a substantial and diversified portfolio and secure disposable income
  • Are a disciplined investor and are willing to bear greater risk in return for greater return
  • Understand that borrowing on margin can multiply losses as well as gains
  • Want to save substantial interest expense while gaining access to funds
  • Understand the Margin Guidelines and Margin Risks
What interest rate are you paying?

What interest rate are you paying for your car loan, credit cards, education financing or personal line of credit? Try our Annual Loan Savings Calculator or see our interest rates and estimate your potential savings.

[1] The current Broker's Call Rate is 4.25%. The Broker's Call Rate was last changed on 12/19/2018 and is subject to change.

[2] If the securities in your account decline in value, so does the value of the collateral supporting your loan, which could result in a margin call and/or selling securities in your account(s). It is important that you fully understand the risks involved in trading securities on margin. Click here for the risks involved with trading securities in a margin account.