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You can do the same by buying stocks on margin. It does not mean this is a good idea, however.
by cycrutchfield 9y ago
You can do the same by buying stocks on margin.
It does not mean this is a good idea, however.
- sanderjd 9y agoCan you really get 20x leverage on margin?
- sokoloff 9y agoIn practice,it’s hard to get much beyond 3x leverage in the equities market. It’s typical to find 5x, fairly common to get 20x, and possible to get to 33x in the real estate market.
- throwaway30yo 9y agoUse options and you can get very leveraged.
- naveen99 9y agoThe option premium limits your leverage for holding a leveraged position for long using options.
- toomanybeersies 9y agoYou can get massive leverage on CFDs (Contracts for Difference), you can run on as little as 5% margin (i.e. 20x). Maybe it's different in the USA, but in New Zealand the lowest I've seen is 5%, which is uncommon, 10% for lower value houses, and only 20% margin is common.
- sokoloff 9y agoGGP was “stocks on margin” and my response of (unqualified) equities I meant stocks as well.
- deleted 9y ago[deleted]
- runT1ME 9y agoin most states, mortgages are no recourse. If I borrow a million bucks and default on it, I lose the house and take a credit hit, even if I have millions in the bank. If I borrow a million dollars (margin) to invest in equities and I need to cover the loan, they can sue me/force me into bankruptcy.