Can we get loan for trading?

Ushuaya

Newbie
4 0
Firstly, I think the idea of borrowing money for trading is ridiculous. But it is possible nonetheless. Big banks, public or private, will not give you money for this purpose. But microloan companies will be only too happy to give you money. They're not interested in what you do with the money or how you're going to repay it. They are only glad to fleece you of everything that you own. When I got excited about the idea of trading but had no money, I was able to get a loan at kertaluotto.com. At first, trading was going well, but then I just started losing money. Then I realized that soon I wouldn't have the money to pay it back.
 
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Shanalotte

Newbie
7 0
That is a very risky idea, to be honest. No, obviously, it’s your choice what you will do with those money, but I really think that for trading, you must start with your own money. This way, and only this way, you won’t feel that pressure that if you lose some money, you will have troubles. Follow my example, I have once fallen for that, and it didn’t end well. Nevertheless, if you still want a credit for a purpose like that, you can have it here https://www.fundinghub.co.za/unsecured-term-loans. As a regular bank will not borrow you money for such a deal, here you can have your money easily.
 
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cfdpiee

Junior member
23 4
@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.
 

hazelj80

Member
54 1
I would just go through a prop firm like FTMO or 5%rs if you can actually trade. They'll front the money you just have to follow their rules don't borrow high interest money to trade bad idea
 

wmram

Member
53 18
If you can actually trade, you won't need to borrow money. Speculative markets are leveraged and highly scalable; all the money that you need is already there.
 

pezza55

Junior member
38 7
Not sure I see this as a good plan. I am not sure who would loan a new trader any funds. I would have said this would only be available for highly experienced traders with a proven track record. I would give yourself more time and build up from a low balance. That way you keep all of your own profits.
 

Nowler

Experienced member
1,515 225
@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.
 

cfdpiee

Junior member
23 4
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.
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.
 

Nowler

Experienced member
1,515 225
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?
 
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Nowler

Experienced member
1,515 225
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.
 
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earlchristensen

Junior member
31 2
Of course, you can get a loan to trade but I don’t think anyone would recommend doing that. Trading is a risky business and there are no guarantees of making money. If you happen to trade with your borrowed money and make a huge loss, you will be in a financial crisis. So, it is better to use your own money to trade.

Moreover, you should never put an amount at risk that you can’t afford to lose. You have no idea how the trade would turn out to be and what your results would be. So, it is better to use your money. At least, you won’t owe money to anyone if you make any losses.
 
 
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