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12.10.11

Margin Loans

Customers with significant financial assets may be able to find better rates using margin loans against their portfolios, said Cathy Jameson, a managing director of Silvercrest Asset Management Group, a New York-based investment adviser and family office whose clients generally have $5 million or more in investable assets.
Jameson’s clients are able to access margin loans on their investment portfolios for as little as 1 percent and have used the loans to pay for home improvements, she said.

“There’s definitely cheaper money around, assuming that people have access to it,” Jameson said.

One client pays about 50 basis points for margin loans to purchase “recreational equipment” that he then leases, said Jeffrey Thomasson, chief executive officer of Oxford Financial Group Ltd., an investment adviser and family office based in Carmel, Indiana, which oversees more than $16 billion. He declined to say what the client buys for confidentiality reasons. A basis point is 0.01 percentage point.

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