Is it wise to borrow to invest?

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Is it wise to borrow to invest?

im keen to get in on the low prices of shares at the minute but can not afford it. Would it be completely out of the question to borrow to fund my investment?

Answerer

Ask your self this: What will happen if my investments perform badly or are wiped out all together? If the answer is bankruptcyy or financial hardship then you would be mad to borrow to invest. Come to think of it, if you do not already have sufficient liquidity to put into investments then I guess either your present income and capital is not sufficient to allow for such risks.

SAVE TO INVEST- most unit trusts and OEICs usually offer a regular contribution facility minimum usually Â£20-Â£100 per month). Most companies offer ISA wrappers for added tax efficiency).

raysor

NO. In fact in the UK a reputable stockbroker would not take you on as a client if your financial profile and net liquid assets (Cash!) were not adequate. Otherwise he/she could find themselves in trouble with the authorities.

piet lul

not a good idea.

Sally

Then you are still under 21.

Just wait and call me to be ur friend when u r ready!

Kay

It's a terrible idea. Plus nobody will offer you "margin trading." .

opel

its a risk
a very big risk

the share prices of many companies are very low at the moment and they can either go one of two ways

drop to zero and go bust
or climb and make you a profit

so which ones do you choose?
ththat'shere the gamble comes in.

Its best not to gamle with money you don't have or don't have a way to pay back,

regards
Shaun
http://fractionalinvestmentpropertypension.pkp7.com/

Daniel O

Very bad idea. It could easily still fall further, and it will take years to recover. Borrowing to invest is a bad idea at the best of times.

Ages

It is a huge risk you would be taking and in the worst case scenario, you would be in deep deep trouble. But if you really want to go ahead, you may start off in a very small scale by investing in fundamentally good companies. If you go overboard when you taste small profits, the consequences could be absolutely catastrophic.. Beware!!

London NW3

Never gamble what you cannot afford to lose.
Lose your borrowed money and think how you'd feel paying back something that you have lost

Henry Hedgehog

It's never wise to borrow for any reason if you can avoid it. Debt is a bad thing, no matter what the lenders may say.

Anyway, what you're talking about is speculation, not investment. You only want to buy the shares because you think they'll go up in price.

If you want to lose money but can't afford to buy shares, spread betting is a good way to do it. You can lose many times your stake.

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