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Margin and Leveraged Loans

Margin Loans:

Trade99 offers margin loans that offer its users that extra money required for short-term money needs. 

Margin loans are basically the money that you can borrow against the value of the securities that a person owns. This kind of loan comes with interest. Therefore, it is highly recommended to gauge your situation— whether you can afford to pay interest or skip buying the desired commodity all-together. 

Here are a few key reasons why you should opt for margin loans:

  • With margin loans, you can have a better buying power to purchase securities, pay large amounts of money or satiate your liquidity needs
  • It basically gives you a sense of flexibility to gain access to funds without actually selling any of your investments
  • Another benefit of margin loans is the low rates
  • Margin loans offer instant access to funds to be used straight up, once the loan gets approved
  • The user is free from any closing costs, annual fees, setup fees, or any kind of non-use fee. This gives margin loans its distinctive characteristic.

Leveraged Loans:

Trade99 offers leveraged loans to its users. Leveraged loans cater to those with poor credit history. Any individual or company can benefit from this kind of loan. Given that there is a greater risk involved, the interest costs of leveraged loans are usually high. Therefore, any loan that comes with higher interest rates (than the average), is considered as a leveraged loan. 

Here are some key points to consider:

  • Usually, there is an involvement of at least one commercial or investment bank when it comes to leveraged loans.
  • The terms of the loan are subject to change, also called ‘price flex.’ It is completely in the hands of the bank or banks involved.
  • These loans are used to bring the financial balance back to the balance sheets, re-finance debt, buy back any stock, etc.