Margin lending allows you to take a margin loan to invest in stocks and ETFs using your cash and securities as collateral to leverage your positions.
How does margin lending work?
Margin lending lets you borrow money for investing in a wide range of securities such as stocks and ETFs by putting up eligible assets in your account as collateral. This means that you can add leverage to your investing and take positions larger than your current cash balance and/or holdings.
In short, margin lending increases your buying power when investing in eligible securities. The margin loan acts as a simple credit facility, where the amount you can borrow is determined by your financial situation and the collateral value of the eligible assets in your account.
How do I enable margin lending?
If you already have an account, you can enable margin lending in your trading platform, under the menu 
> Your account > Margin lending.
What does buying power mean?
Your buying power is the amount of money available for investing.
Saxo allows a percentage of your investment in eligible assets to be used as collateral to borrow money for increasing the size of your position. That way, your buying power increases. It is calculated as a function of your available cash and the collateral value of eligible assets in your account.
The collateral value of an eligible asset depends on the risk rating of the individual instrument. You can find the collateral value of eligible assets under the 'Instrument' tab of the Trading conditions. You can also see the collateral value of a specific instrument on the trade ticket in the platform.
What are the financing terms? How is interest charged?
When a trade is funded by a loan (whether wholly or partially), you will be charged a margin lending interest rate for the borrowed amount. The loan amount is assessed daily based on the net cash balance on each margin lending account in the respective currency. The loan interest is calculated daily, and will start accruing from the settlement date of the margin position, and is booked to the loan amount at the start of each calendar month.
As an illustration (1) of a $100,000 loan and an interest rate of 2%:
You can find the Margin Lending Interest Cost under the Trading rates tab of the Trading conditions on eligible assets. Furthermore, you will be able to find a breakdown of the charges to your account in the Margin Lending Interest Details report available within the platform.
Do note that you will be charged interest on any outstanding margin loan, even if the aggregate cash balance on all your sub-accounts is positive.
(1) This is for illustrative purposes only and is without prejudice to any of Saxo’s rights under the Margin Lending Terms and/or General Business Terms. In the event of any inconsistency, the provisions of the Margin Lending Terms and/or General Business Terms shall prevail.
What happens if I trade in a currency other than my account currency using margin lending?
Before placing any order via the Trading Platform, you should carefully select the sub-account that the order is to be placed under. Our competitive conversion rate will apply to any trades that are placed in a different currency than the account currency of the sub-account used. You can find more information about our currency conversion fee here and more information about opening a currency sub-account here.
Do note that you will be charged interest on any outstanding margin loan, even if the aggregate cash balance on all your sub-accounts is positive.
How much can I borrow?
The total amount you can borrow depends on the collateral value of eligible assets in your account.
Each eligible asset has a risk rating from 1 (lowest assessed risk) to 6 which is used to determine the collateral value of the asset. As an example, a stock rated 1 can be collateralized for 70% of the market value of the position. You can find the risk rating and associated collateral value of eligible assets under the 'Instrument' tab of the Trading conditions.
What happens if I exceed the loan limit?
In general, you need to monitor and ensure that your “margin and loan utilization” remains below 100% at all times to avoid a “margin call”. A “margin call” is an automated stop-out where Saxo cancels open orders and closes open positions in your account(s).
You can see your “margin and loan utilization” in the platform in account details. You will start receiving alerts once your “margin and loan utilization” reaches 50% (or higher).
The ”margin and loan utilization” reflects the higher of the “margin utilization” and “collateral utilization” ratios of your margin account(s). During a “margin call”, Saxo may close different types of positions on your account depending on whether your “margin utilization” ratio or “collateral utilization” ratio (or both) has exceeded 100%.
Will my collateral utilization be reduced if I close my profitable margin positions (e.g., FX, CFDs, Futures)?
Closing profitable margin positions will reduce your collateral utilization but this will not happen immediately. Your collateral utilization will be reduced once the profits are reflected in cash after the daily upload the next day.
Will my collateral utilization be improved if I sell my stocks or ETFs?
Your collateral utilization will be reduced immediately if you have sold your stocks or ETFs.
How long will it take for margin lending to be enabled after I have opted in?
Margin lending will be enabled immediately after you have opted in.
What will happen if my collateral utilization reaches or exceeds 100%?
Saxo will generally begin closing out your cash positions (e.g., equities, ETFs, bonds, mutual funds). However other positions on your account may be closed subsequently – for example, if your collateral utilization remains above 100% even after your cash positions have been closed.
What will happen if my margin utilization reaches or exceeds 100%?
Saxo will generally begin closing out your margin positions (e.g., FX, Futures, CFDs). However other positions on your account may be closed subsequently – for example, if your margin utilization remains above 100% even after your margin positions have been closed.
Can I enable margin lending if there is an overall negative balance in my account?
You will need to first satisfy the negative cash balance in your account before margin lending can be enabled. You can do this by making a fresh cash deposit or closing existing positions on your account.
Can margin lending be enabled if I do not have an account in USD or SGD?
Margin lending can be enabled on sub-accounts in all currencies but you will need to have at least one account in either SGD or USD for margin lending to be enabled. By enabling Margin lending, all your sub-accounts will be enabled for Margin lending automatically.
Can I use margin lending to invest in Mutual Funds?
You can only invest in Mutual Funds using cash in your account.
Will the margin level for trading leveraged products (e.g., CFD, FX and Futures) be affected if I enable margin lending on my account?
If you enable margin lending, the margin available for trading leveraged products can be reduced if you have negative cash or unrealized profit/loss from leveraged positions in one or more sub-accounts. This is due to the additional FX haircut applied on the negative cash and unrealized profit/loss once margin lending is enabled on your account.