Can we get loan for trading?

[DT5]

Not a good idea for all the reasons stated above

 

[Nowler]

@Shanalotte i don't think taking a loan from a bank or institute is a good idea, rather a trader could use leverage offered by their brokers according to their trade. And moreover you are right, regular banks won't agree to give a person a loan for trading, because at the end of the day, it's a risky business.

I would argue that is is actually worse than getting a loan - with the caveat that the loan money is not leveraged (margin account).

My point specifically is that, generally speaking, trading on leverage is far more dangerous than taking out a loan to trade.

 

[Nowler]

I differ on that , the rate of interest on loans is way higher than the margin charged on the leverage. And today most traders use leverage and trade successfully. Leverage is dangerous only when a trader trades recklessly, if a trader is following all the principles of trading and has a proper risk management plan, I don't find any drawbacks in it.

Most traders absolutely do not trade successfully! Not even remotely close! Leverage or not.

What a wacky thing to say!
What information did you base that comment on?

 

[Nowler]

I wouldn't recommend anyone take out a loan to trade, or to use leverage, but for the sake of this discussion if it has to be one or the other:

Leverage will get you to where you are headed, real quick!
So for the majority of people, that is to 0, or worse.

At least with a loan you go there slower and therefore have more time to think and react. With leverage, time becomes an enemy when your position moves sideways or against you. You get charged a premium for the luxury of being wrong or early.

Both can and generally are a bad idea - unless you are one of the exclusive club that can turn a consistent profit.

 

[HeavLeighGill]

I don’t wanna be negative but I really wouldn’t advise getting a loan for trading. What if you lose money? Then you’ll be out the amount of the loan and will have to make more money just to pay it back with interest. I think you should only invest money that you have on hand that isn’t meant to be spent on bills or other important things. You can also open a trading account with $10 or so, so why not start small and work your way up? This is just my opinion though, if you do take out a loan then I wish you luck!

 

[Nowler]

Can you please tell me in more detail how things are now? Have you managed to make a profit from trading? I am just start to trading in various platform. I am especially interested in cryptocurrency and coins.

Don't get a loan to gamble on Crypto - if you do, you deserve what happens to you.

 

[Smith2525]

Start with a small balance. Leverage is effectively lending..... Don't put more than you can afford to loose into your account as others have said. Start small, build it up

 

[Farm Yard Forex]

You can go down the prop firm route for more capital but the risk is still relative. They have many rules such as maximum loss per day which is effectively the size bank you should be thinking you have and not the equity. If you can stick to the rules and keep the account running for a little while then it's a useful way to bump your capital up. But don't borrow money for things that aren't assets that will make you money. Since you can't guarantee that in trading, it makes no sense.

 

[Flink]

Do you want to trade with loan money? What will you do if you lose the loan amount in trading? Reconsider your decision or should I say, drop this idea, as it will have catastrophic outcomes.

 

[chrisrizzo]

Hello!Good idea. At least there must be a way to support new market participants on they trading journey. Have you heard of BluFX? It is a broker that does exactly what you think. It is a broker that supports you financially just as they expose you to the forex markert. You are not given a loan that you have to pay back, but you subscribe monthly for a funded account. All you do is pay a monthly fee the first time you want to subscribe and you are given a funded account to begin trading and for your next subscription, you can pay from your profits. It's that simple! The monthly fees depend on the account size you want, and believe it, the fees are fair. The smallest account size starts from $25k. Sounds good to be true? Go see your self! (BluFX)

New traders, on the whole, are losing traders. The majority of them lose badly and soon, and they are wiped out before they realize why. Any trader who has to borrow money because they're losing money on the market is approaching the situation incorrectly. Better trading, not more money, is the answer.

 

[DT]

It's very easy to get a loan to trade and it's very common, brokers and bucket shops facilitate this all the time, this is what trading on margin and utilising leverage is!

This is why you'll have say overnight interest charges at a CFD provider, they're essentially lending you the money to keep the position open. Likewise, a US broker will allow you to trade US equities with leverage, they're essentially loaning you the money to do so or conversely if you want to short a stock they'll facilitate the loan of shares for you to sell. Some US prop firms will give you way more leverage than the typical broker will allow too.

So yeah, loans are incredibly common in trading and you don't even need to look any further than your own broker or clearing firm for them, they're best placed to lend you money as they're monitoring your positions and will liquidate if you have insufficient margin.

 

[DT]

I don't think you understand what leverage is.

 

[Jorg@33]

In my opinion trading should not be done with the borrowed money, because if you lose in trading then you will get into a huge debt trap of the principal amount along with the interest too has to be paid.

 

[Tytus_Barnowl]

If you ever get to a trade show or some of the business shows in London. Here is the great and beautiful team that will advise you on how to take out loans for trading, after they have shown you a brilliant way to trade.

 

[DT]

A friend of mine has a mortgage on his house and last year the bank that provided him with the mortgage produced Equity Release Leeds. This allowed him to become a shareholder and purchase several shares at the expense of a mortgage. I do not know exactly which banks provide this opportunity, but they can be found on the Internet and you can learn more about it. I hope you'll succeed, good luck!

That's a really dumb idea, firstly it isn't a bank - it's just a company that will essentially buy the right to a portion of the equity in your house.

Secondly, leverage is already available from plenty of brokers.

 

[Parky]

I think the consensus here is spot on. A trader that cannot fund himself would by definition not be a good trader. Likewise with those that get you to pay for "training course" at the end of which you are given a worthless piece of paper. if you are any good those companies offering training would sign you up for full time trading position, if they don’t then nobody else will. As a new trader borrowing money to trade would not be sensible, start small on a platform like Interactive with money you can afford to lose and if successful build capital and increase trading size. Not all strategies that work with low volume are scalable. If you have consistent profits over a 12-18 month time frame you can take that trading record to prop companies who may be willing to back you with funding.

 

[Muller21pr]

I think that loans can be given for business, about trade I'm not sure.

 

[MrMosquito]

I just got a idea in my mind that can we get loan for trading and there are any company which provides loan to new traders to start their trading?

I know there are a lot of companies that fund you to trade, meaning that they give you some money, and you trade and share your profit with them, the point is that they usually take a test or ask you to trade on a demo account under certain circumstances to determine your trading skill.