Margin lending gathers head of steam
Retail investor interest in protected margin loans has now surpassed $1 billion according to theReserve Bank of Australia.
According to Macquarie margin lending division director Phil Richards protected margin loans enable investors to benefit from share market growth without the risk of losing their capital.
“This sustained growth has shown that investors are continuing to protect their capital during a range of conditions,” Richards says.
Meanwhile St.George in the more traditional straight margin lending arena has surpassed $1 billion dollars, pushing its margin lending market share up to 9 per cent - with Macquarie andBTthe dominant players in the market.
“In the 12 months to September 2003, margin lending has grown in Australia at a rate of approximately 9.5 per cent. In the same period St.George has experienced growth in excess of 20 per cent,” the group’s head of margin lending, Andrew Black says.
“Brokers have traditionally been the first to employ margin lending when the market begins to pick up… What we are finding now is that financial planners are jumping on board and embracing gearing, as there market continues to strengthen.”
Recommended for you
ASIC’s enforcement action is having an active start to the new financial year, banning a former Queensland financial adviser for 10 years in relation to fees for no service conduct.
ASIC has confirmed the industry funding levy for the 2024–25 financial year, and how much licensees can expect to pay.
Australian licensees are expected to make greater use of custom model portfolios for their clients, according to State Street Investment Management, following in the footsteps of US peers.
Adviser Ratings has argued that it’s time for more advisers to utilise digital engagement tools available to them as a disconnect grows between consumers seeking advice from finfluencers and from professionals.