I've just returned from Australia, where I noticed that the Australian banks (Westpac in particular) are actively pushing the idea of gearing (borrowing to fund investments in a managed fund) to their personal customers, and apparently have been for some years now.
Are there any UK banks which offer a similar service to their personal customers? My initial investigations lead me to believe not, but I'd be interested to know if any do. And if they don't, why not?
Regards, Tom.
In message , GI Joe writes
Not explicitly. Generally this is the realm of Private Bankers for their High Net Worth clients.
Its generally believed to be inadvisable for inexperienced investors to borrow to invest in shares and the FSA particularly dislikes banks lending so that the clients can invest in the lender's own products.
Many tears have been shed over this in past. It will probably happen in Australia after their next stock market crash.
There's plenty of private equity and hedge funds out there, they are essentially highly geared funds, except they do the borrowing for you.
How about personal gearing to invest in a highly leveraged hedge fund? Ohh... now you're talking, we're almost into the world of LTCM :)
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