Re: Taking out a prosper loan to buy stocks
Unless you can show a long-term (ie- 5 to 10 years) of consistent outperformance at an acceptable level of risk, I'd say don't do it. I feel you're about to lose your shirt.
Besides, 12% is a HUGE hurdle to overcome. I pay a little over LIBOR rates for my margin, and even my current account overdraft rate is less than 12%.
Margin isn't really for investing - it's more suitable for trading or shorter-term investing opportunities.
If you desperately want to use margin, then I'd strongly suggest you only gamble with a small % of your portfolio. I keep a maximum of 30% of my portfolio exposed to margin, with a notional rtading requirement of around 5%. I never allow a trade or idea to risk more than 1% of my account equity.
I think you should concentrate more on preserving your capital than hitting for the fence every time.
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