Articles on: Investing

Do you utilize leverage or margin?

Do you utilize leverage or margin?

We never recommend to use leverage or margin to invest

if you do happen to invest with margin loans or leverage just before a market crash, your broker will likely force exit your positions to cover their bottom line, and you will be left having sold your shares at the worst possible timing. Making the recovery time longer and more difficult.

Different brokers have very different rules and hidden fees for margins.
In general no matter what strategy you use. We always recommend you don't invest money that you can't live without for at least 2 years.

In the event a crash happens (and it will, we just don't know when), our recommendations like all other common stocks will lose value, and the average recovery time from these events has been around 8 months. That means 8 months where your portfolio would be worth less than the previous highest balance.

If you happen to invest before a crash, and you used margin loans or leverage, you will likely be significantly worse off!

Updated on: 17/07/2020

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