Saxo launches margin financing accounts in Singapore
SINGAPORE, 9 DECEMBER - Saxo, a leading multi-asset investment platform, today announced the launch of margin financing (subsequently referred to as “margin lending”) accounts in Singapore. With this launch, clients can now manage their investments purchased via margin lending separately from the rest of their assets.
Alongside the launch of Margin Lending Accounts, Saxo is also introducing a series of enhancements.
- Improved Collateral Rates: Tiered collateral rates now offer more favourable leverage for stocks and ETFs rated between risk levels 2 to 5.
- Partial Stop-Outs: To help clients manage their risks more proportionately, Saxo has implemented partial stop-outs for its Margin Lending Accounts, replacing the previous full liquidation model.
Saxo first introduced margin lending in 2023. In response to feedback gathered from clients, we have implemented these enhancements to improve the overall margin lending experience.
Commenting on this, Mahesh Sethuraman, Singapore CEO at Saxo said: “This launch is a reflection of Saxo’s commitment to being a client-centric organisation. We are constantly listening to our clients and evolving our platform to deliver the best investing and trading experiences for our clients. The enhancements to our margin lending offering will provide greater flexibility, transparency, and strategic control, whether clients are looking to amplify their buying power or optimize dividend income. The team continues to charge forward, helping our clients not just be invested but to be invested with conviction and confidence.”
What is Margin Lending?
Margin financing, otherwise known as margin lending, is a financial service that allows investors to borrow money to invest in instruments such as stocks, ETFs, and bonds. The borrowed funds are secured against the value of the investor’s existing portfolio, which acts as collateral. While margin lending carries increased risks, it also allows you to invest more in trades you are confident in by boosting buying power and allowing you to supercharge your dividend yields.
For an example of how margin lending can improve dividend yields, see appendix A.
How it works?
When you enable “Margin Lending Account” on Saxo, a separate account called 'Margin Lending' is set up. Within this account, you can utilise a margin loan to support your trading of stocks, ETFs, bonds and stock options. You can also use a margin loan to support physical delivery of the underlying instruments upon option assignment.
Appendix A
Scenario A: Without margin lending Client has $5000 cash right now. He buys Stock A and receives 5.50% dividend. | Scenario B: Using margin lending Client takes a margin loan of $15,000 (max loan), to buy $20,000 worth of Stock A | |
Amount invested | $5,000 | $20,000 |
Dividend | $275.00 | $1100.00 |
Interest paid at 3.02%* | $0.00 | $453.00 |
Net Dividends | $275.00 | $647.00 |
Yield | 5.5% | 12.94% |
Today, Saxo is an international award-winning investment firm for investors and traders who are serious about making more of their money. As a well-capitalised and profitable Fintech, Saxo is a wholly-owned subsidiary of Saxo Bank A/S, a fully licensed bank under the supervision of the Danish FSA, holding broker and banking licenses in multiple jurisdictions. As one of the earliest fintechs in the world, Saxo continues to invest heavily into our technology. Saxo’s clients and partners enjoy broad access to global capital markets across asset classes on our industry-leading platforms. Our open banking technology also powers more than 200 financial institutions as partners by boosting the investment experience they can offer their clients. Keeping our headquarters in Copenhagen, we have expanded our reach to having more than 2500 professionals in financial centers around the world including London, Singapore, Amsterdam, Zurich, Dubai and Tokyo.
For more information, please visit: https://www.home.saxo/en-sg
Regional Communications and PR Manager, APAC & MENA
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Email: VERL@saxomarkets.com