Margin Lending is a gearing (or borrowing) arrangement that can be used to borrow to invest in shares and managed funds.

The margin lending provider typically allows you to borrow up to a certain limit on investments. For example, this may be up to 75% of the value of certain managed funds or shares.

The lender uses the shares or managed funds as security.

However the actual amount you can borrow varies depending on how risky the investment is.

The margin lending provider would be able to supply you with a list of the investments that you can borrow against, and the percentage they will lend you.

For example, a margin lender might lend you up to 75% on Company X Shares. If you had $25,000 to invest, this means you could borrow an additional $75,000.

The result is you could invest $100,000 into Company X Shares, of which $75,000 is from borrowed money.