Margin Debt

[Kerim]

Thought this article was interesting. Of course you can always find a scary graph when you need one, but it strikes me as surprising that margin would be at all-time highs right now.

[crimsonghost747]

Interesting graph indeed. I love the fact that I have a margin account so I can buy if I want to and just transfer the money afterwards. But I'm not even considering using margin for long term investments right now. The markets are close to all time highs and in general the P/E ratios are getting too high for my own taste.

Though one has to also take into account that debt is cheaper now than.. well.. I honestly can't recall when debt would have been this cheap. Could very well be simply that a lot of individual investors can get margin for a much lower rate than the dividend % of their portfolio, so as long as the dividend doesn't get cut and the interest rate doesn't jump in a major way... it's free money right?