Topic: How To Invest

What is Pat’s commentary for the week of March 8, 2016

Article Excerpt

In all kinds of markets, investors may ask, “Is now a good time to buy stocks on margin?” The market has been going down for a year or so, and this appeals to bargain-hunting investors. In contrast, some investors only start to think about margin investing when stocks have been shooting up. Others pay less attention to market trends, and instead zero in on financial fundamentals or market-shaking news developments. The right answer to the question is all about your personal goals, finances and temperament. It has little to do with the market outlook. Buying stocks “on margin”—that is, using borrowed money to buy securities, regardless of whether you borrow from your broker or some other source—has certain key properties that apply in any market. 1. It can give you an immediate tax break. You of course have to pay interest on the money you borrow. You can generally deduct this interest against ordinary income in the year in which your pay…