Margin Trading

WildBear · 1 Margin Trading Sat Sep 03, 2011 6:41 pm

WildBear

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Currently I'm trading with Asia securities, They offered me margin trading facility for portfolios above 1 million through Asia Asset Management PLC at 18 % p.a.

I also heard that DFCC giving at 14 % but not sure the portfolio value they requre and whether they allow online trading.

Anyone using Asia Asset Management Ltd margin facility, or from any other firm please share your ideas.

nkalansu · 2 Re: Margin Trading Sat Sep 03, 2011 7:19 pm

nkalansu

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I have a margin facility of Rs. 750,000/= with Asia Asset. At the time of request my portfolio was around Rs. 1.95 Million. So basically they have given me about 40% of my portfolio value. I have been using it since April 2011.

Actually they don't hold your portfolio. When you sell something, Asia Securities will send the settlement cheque to Asia Asset. Then they will deduct your capital and any interest due from that. If anything remains after that they will credit your Asia Securities account again.

As you said int. rate is 18% and its pretty expensive. Since market movement is unpredictable and not much profitable this year I think using a margin facility is not that profitable (Not profitable If you are a value investor......very profitable if you are trader going behind junk stocks and based on inside information because you will know exactly when to use your margin.)

Anyhow they will gain 18% even if you win or lose. They will win always. So best thing is to find your own money and invest. Don't go for margin trading. If you get a very low interest then you may consider a margin facility.

You said DFCC offers 14%. But still its very expensive when considering the very low deposit rates offered by many banks for your deposits. Banks earn SUPER PROFITS at our expense. If you use your own money whatever earned by you will be yours. You don't have to give it to Banks or Finance Companies. Try to build your own equity base. It will take time.

I am also planning to settle my margin as soon as possible.

Rajaraam · 3 Re: Margin Trading Sat Sep 03, 2011 7:32 pm

Rajaraam

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I think JBS charge only 14 %.

WildBear · 4 Re: Margin Trading Sat Sep 03, 2011 10:08 pm

WildBear

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Thanks both of you, + rep

Gaja · 5 Re: Margin Trading Sat Sep 03, 2011 10:32 pm

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DFCC charging 14%, but they offered at 13 or 12% even based on the value of the portfolio, on line they gave but you can't put the buy orders!

PGCR · 6 Re: Margin Trading Sun Sep 04, 2011 8:49 am

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Online trading facility is offered by ur broker. Not the margin provider. Dont get mess up with those two things.

If u want to buy, through ur broker u can do it. If your securities are value enough to do the payment, then margin provider will do the payment to ur broker.

For ur information i tell u one thing. Among the margin providers in the country DFCC is having best security portfolio & it wont lend against speculative type of shares. (you can have those shares in ur portfolio but get only 0% margin leeway)

Gaja · 7 Re: Margin Trading Sun Sep 04, 2011 9:19 am

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PGCR wrote:Online trading facility is offered by ur broker. Not the margin provider. Dont get mess up with those two things.

If u want to buy, through ur broker u can do it. If your securities are value enough to do the payment, then margin provider will do the payment to ur broker.

For ur information i tell u one thing. Among the margin providers in the country DFCC is having best security portfolio & it wont lend against speculative type of shares. (you can have those shares in ur portfolio but get only 0% margin leeway)

Friend its true online trading facility is offered by the brokers, but when the account is margin facility the broker will give the online trading facility only if the margin provider agrees.

Yes DFCC having 3 list of shares where you caan get 50%, 30% or 0% Margin, only concern is they will not give for Commercial Bank Shares also because they have more than 10%, and any of the margin trading provider can't give the margin for there own shares

PGCR · 8 Re: Margin Trading Sun Sep 04, 2011 10:21 am

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Yep Gaja u r exactly correct.
According to Banking act provisions DFCC can't lend against its own shares, Commercial bank shares and Lanka Ventures shares.(hold 40% through Aquity patners)

FYI, DFCC is not against online trading. You can do your trading as usual.

Further Details

0112371371
Ext. 1685

Gaja · 9 Re: Margin Trading Sun Sep 04, 2011 10:49 am

Gaja

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PGCR wrote:Yep Gaja u r exactly correct.
According to Banking act provisions DFCC can't lend against its own shares, Commercial bank shares and Lanka Ventures shares.(hold 40% through Aquity patners)

FYI, DFCC is not against online trading. You can do your trading as usual.

Further Details

0112371371
Ext. 1685

thanks i will check with them, but my online i can do all the things other than purchasing order, but my broker is nice person, so sooner the sms i send the put the purchase orders and i used to execute the sales.

manula · 10 Re: Margin Trading Sun Sep 04, 2011 11:00 am

manula

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Gaja wrote:

PGCR wrote:Yep Gaja u r exactly correct.
According to Banking act provisions DFCC can't lend against its own shares, Commercial bank shares and Lanka Ventures shares.(hold 40% through Aquity patners)

FYI, DFCC is not against online trading. You can do your trading as usual.

Further Details

0112371371
Ext. 1685

thanks i will check with them, but my online i can do all the things other than purchasing order, but my broker is nice person, so sooner the sms i send the put the purchase orders and i used to execute the sales.

Can i get the margin trading facility if i am working in overseas.. What i understand from above posts though we get Margin Trading we will not get the online facility to use purchasing order... it will be difficult to contact broker every time from out of SL.

WildBear · 11 Re: Margin Trading Sun Sep 04, 2011 11:24 am

WildBear

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PGCR wrote:Yep Gaja u r exactly correct.
According to Banking act provisions DFCC can't lend against its own shares, Commercial bank shares and Lanka Ventures shares.(hold 40% through Aquity patners)

FYI, DFCC is not against online trading. You can do your trading as usual.

Further Details

0112371371
Ext. 1685

Hi
Do you know what is the minimum amount of portfolio value DFCC needed,

Thanks in advance