Glossary

Approved security – is an approved investment (share, managed fund, cash) that you can lodge as security, or collateral, against your margin loan.

Acceptable securities list (ASL) – is our current list of all securities, and their loan-to-value ratios (LVRs), that you can borrow against with your margin loan. See it here: stgeorgemarginlending.com.au/sgbasl

Available funds – is the amount available to draw down from your loan for further investment. This is determined by the lower of your borrowing limit and credit limit, less the loan balance.

Borrowing limit – is the maximum your loan balance can reach based on the securities in your portfolio (different from your credit limit – see below). It’s calculated by multiplying each investment’s market value by its LVR. The borrowing limit will fluctuate based on changes in the market value and LVR.

Buffer – is an amount above your borrowing limit, which allows you to absorb small market fluctuations without triggering a margin call. The buffer for St.George Margin Loans is generally 10% of total market value.

Credit limit – is the maximum loan balance. The credit limit you request in your application is subject to approval based on an assessment of your financial position.

Facility – is another way of referring to your margin loan account.

Loan balance – is the amount you’ve borrowed.

Loan to Value Ratio (LVR) – is the percentage of an investment’s market value that we’ll lend you. An LVR is allocated to each of the approved shares and managed funds held on your margin loan. These can be changed at any time without notice.

Margin call – is triggered when your loan balance exceeds your borrowing limit by more than the buffer. If you receive a margin call, you need to bring your loan balance back under your borrowing limit or we may sell your securities to do this. You can sign up for our email/SMS buffer and margin call alerts to help you manage your account.

Maximum LVR – this is the maximum amount you can borrow (as long as you’re within your credit limit). It’s simply the borrowing limit expressed as a percentage.

Security – is any assets that are offered to secure the loan and which may be sold if the loan balance is not paid back in the event of a default or margin call.

Third party security – is using another person’s (or company’s or trust’s) investments as security for your loan.