These changes by IG only affect margin lending. Are many Strawman.com members actually borrowing money to fund share purchases? I've always thought that was a risky businesses and I've always avoided it. A very low rate personal loan to fund share purchases might not be too bad, but most margin lending agreements can be changed, as we have seen with IG this month, and it is possible that people are forced to sell shares that they believe are undervalued yet they are underwater on (showing a paper loss). Being forced to crystalise a loss in those circumstances and the permanent loss of capital that results from that - is a real risk with margin lending, and that risk should be front and centre in the minds of people thinking about getting into it - and those who are already doing it. It depends on your risk tolerance of course, but it's certainly higher risk than investing your own money.

Hi Bear, I personally use a product from NAB that I would recommend called Equity Builder. It is a margin loan that operates without margin calls by only allowing investments in sturdy, reliable LIC's & ETF's. So unfortunately you can't use it to invest in most of the companies discussed on Strawman, but for those with a longer horizon looking to maintain a conservative portion in their portfolio, a five year loan at 3.75% is an attractive proposition given that many of the above funds pay 4% + 2% yield before even allowing for capital growth.

Sure is higher risk Bear77, you are leveraged on the way up and on the way down plus risk a margin call and may be forced to sell at the worst time, when things are down. Uses of margin loans should absolutely understand and manage this risk - its big! I do use margin lending but at very conservative levels (>50% value falls before getting into margin call territory) and back it up with access to secured lending I can draw on if needed. The reason being that I can borrow on margin with Interactive Brokers at less than 1.5% which is much lower than using a Line of Credit secured against a house (or personal loan rates). I started using margin loans just prior to the GFC - great timing and a great way to learn (provided you started small and could cover margin calls). At the time interest rates were much higher and I used CommSec for margin loans at much higher rates than IB offers. At the time it worked because I could use spare cash to put in our house offset account (reduce non deductible debt) and the borrow on margin (deductible debt) to buy shares. It accelerated us being able to pay off our house loan without additional risk, which then enabled us to build a line of credit on the equity in our house and allowed for more tax effective investing... Debt is a great tool (try buying a house without it) - but all debt, especially margin loans increases risk. Understand the risk and don't overextend yourself. If you unsure then stay away from it or start very small and take your time. There is always going to be another GFC/Covid type event in the future!