I was thinking of using a margin loan soon for the first time and I have to say I still don’t understand the fine details.
Today I got a message from IB saying that for one of my (EU based) funds, marging requirements will change as of TOMORROW from an initial requirement of 50% to 100%, while the maintenance margin will increase to 100% much more slowly, in a week… This was a bit shocking and makes me rethink my plan. What if had borrowed against that fund and had only one week to pay back ALL of the loan?
One think I don’t understand is: if I have a bunch of ETFs on my portfolio, each with its own (up to to today rather similar) margin requirements, which ones will I be borrowing against if I take a “small” loan (up to 20% of the total portfolio)? I don’t see the possibility to choose, I can just withdraw something like 50% of the portfolio value…