SICO Capital offers clients margin lending services that are based on a client’s portfolio value. Through this service, SICO Capital provides margin loans which allow clients to borrow funds to invest in shares, managed funds, and other approved financial products as per CMA regulations in the Kingdom.
Using a margin loan, clients are able to enhance their investing power, which can be an effective way to build wealth and diversify a portfolio of securities. However, SICO Capital also highlights to all clients that margin loans can amplify losses as well. As such, we assist our clients in weighing both the benefits and the risks when thinking about investing using margin loans.
A margin loan is provided based on a client’s portfolio of shares, managed funds, and cash as a form of security, whereby such assets are used to calculate a loan to value ratio (LVR), to determine how much a client can borrow from SICO Capital. Once a borrowing limit is established, a client can use the available funds to purchase additional approved securities instruments after which the new and existing investments are combined to form the total portfolio.