A Colonial Margin Loan may be suitable for investors who wish to increase the size of their investment portfolio, boost investment returns and accelerate wealth creation in a tax effective manner.*
A margin loan provides investors the opportunity to combine their equity (existing investments and cash) with borrowed money for investment into managed funds and ASX listed securities, such as equities or exchange traded funds (ETF’s). A margin loan can also allow investors to borrow against equity in their existing shares or managed funds as an alternative to selling and possibly triggering a capital gains event. Interest costs may be tax deductible.*
Security for a Colonial Margin Loan may comprise of managed funds, ASX listed securities or cash investments . The amount that may be borrowed is determined by the borrowing limit assigned to each secured investment. Borrowing limits are predominantly between 40% and 75% of the value of each security. Our Accepted Securities Lists, found here, provide a complete listing of accepted investments.
Borrowing strategies
The following gearing options are available via a Colonial Margin Loan:
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Lump sum gearing
This strategy involves an investor combining a single equity contribution with a borrowed amount for investment. The total amount may be invested in managed funds, ASX listed securities or a combination of the two. This strategy puts your money to work immediately and provides full exposure to movements in share and unit prices. The flexibility of the facility also allows you to increase or decrease your investment exposure at any time.
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Regular gearing
This strategy combines the power of a margin loan with all the benefits of a disciplined savings plan. A regular gearing strategy automatically combines your monthly cash contributions with a borrowed amount for investment. Regular gearing is suitable to investors who don’t have a large amount to invest, wish to use a more conservative entry strategy or want to adopt a ‘dollar cost averaging’ strategy.
Features and benefits of a Colonial Margin Loan
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Increase the size of your investment portfolio
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Potentially grow wealth at a faster rate.
Permits greater investment diversification.
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Unlock equity
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Borrow against your equity in existing investments as an alternative to selling and potentially triggering capital gains.
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A wide range of accepted securities
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Our accepted securities list consists of over 500 ASX listed securities, 2,000 managed funds and 80 platforms/portfolio services.
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10% buffer
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An allowance for fluctuations in the market value of your investment portfolio before a margin call is triggered.
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Easy application process
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Applying for a Colonial Margin Loan is quick and simple. Most loan applications are approved within 48 hours.
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No application fees for individuals
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There are no application fees for individuals.
Fees apply for company and trust structures.
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Choice of competitive variable or fixed interest rates
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Fixed interest rate options are available for 1, 2, 3 and 5 year periods with interest payable yearly in advance or monthly in arrears. Ask your adviser about the potential tax advantages of paying your interest in advance.
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Online services
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Online services include access to account information for you and your financial adviser, as well as a range of helpful reference material.
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Don’t just take our word for it
The Colonial Margin Loan has received a number of prestigious awards and ratings over the years. Some of our most recent awards include:
For more information or to apply for a Colonial Margin Loan, please contact your financial adviser or call us on 1800 252 351.
* Taxation outcomes can vary according to individual circumstances and are subject to changes in legislation.
The Colonial Margin Loan is one of the products under the Colonial Geared Investments brand which are provided by the Commonwealth Bank of Australia ABN 48 123 123 124, administered by its wholly owned but non-guaranteed subsidiary Commonwealth Securities Limited ABN 60 067 254 399 AFSL 238814. This information has been prepared without taking account of the objectives, financial situation or needs of any particular individual. For this reason, any individual should, before acting on this information, consider the appropriateness of the information, having regard to their objectives, financial situation and needs and, if necessary, seek professional advice. Applications are subject to credit approval. Fees and charges apply.
This website notes some features of a Colonial Margin Loan. Please obtain and consider the product disclosure statement (PDS), available from the Commonwealth Bank of Australia (ABN 48 123 123 124 AFSL 234945) as the product issuer, at www.colonialgearedinvestments.com.au before making any decision about the product.
Please consider the full terms and conditions available on application on this website. Only investors who fully understand the risks associated with gearing into investments should apply.