I’d like to suggest adding a margin investing feature that allows users to borrow against their portfolio with less aggressive leverage than typical CFD products.
Many investors are interested in low-leverage margin access (e.g., 1:2 or 1:1.5) for long-term investing or income strategies, without the risks associated with high-leverage trading. Ideally, users would be able to:
Enable margin on their Invest account (not just CFD)
Control how much margin is used, rather than being locked into a fixed leverage ratio
See real-time margin usage and interest costs clearly
Borrow at competitive interest rates
This would give users more flexibility in how they manage risk and capital, and would be a valuable addition for long-term investors.
I agree that the current CFD margin is quite risky and not adjustebale. However, I don’t think adding margin to the investment account is a prudent idea. I appreciate the distinction between the two accounts as it stands. Perhaps it would be worth considering adjusting the leverage structure, similar to platforms like eToro. or creating a separate margin account. Nonetheless, I remain opposed to introducing margin into the investment account itself, as in my view, that account should primarily serve for margin-free stock and ETF investing and trading.
Trading on margin is high risk. Most don’t really understand it and there are many legal issues (in terms of UK regulation etc).
There is the option to use cfd if you want. Just because it is 5x levered doesn’t mean you have to continuously max out the account and to do so would be crazy. So if you only want to trade basically with 2x leverage then just adjust how much you are trading/position sizes so that you maintain adequate free funds so that you are only 2x leveraged
I get that, but using CFD’s means you don’t even own the stock. I would just like the option to use my portfolio as collateral for some more positions that pay out dividends.
With respect I’m not sure you’ve thought this through. Why borrow money at a high(ish) interest rate just to buy dividend stock that pay a much lower dividend (compared to the interest you are paying to hold the stock).
I don’t see why “owning” the stock makes much difference. cfd account for dividends and just because something is 5x leveraged doesn’t mean you should use anything like 100% of the available funds in a leveraged account so you can easily manage it to be at 2x leverage but you will be paying a non trivial interest rate