It seems that the general idea is not to hold long-term, diversified ETFs in a margin account. IBRK is offering up to 140k for 1.53% and then up to 1.4m for 1.03%. A 100% equity ETF pays this yearly in dividend alone and should make atleast 6% in capital gains (if not more).
Say I have 500k in assets and under 30 years old, why not take out a 200k margin and dump it in a 100% equities, long term ETF?
Assuming the ETF dips 10% in the first year, I can keep 20k on hand to avoid a margin call? After all, after the first year or two, I should be above the margin call and this should buffer against any volatility.
Submitted October 26, 2020 at 08:22PM by BigCMoneyz https://ift.tt/37K9Pwo
