RE:Margin
Newinvestor4562 wrote: Would purchasing more shares of BCE using a margin account be considered too risky? I currently get charged about 5%, with a dividend yield of 8.7% I would be making a profit just holding the stock. Would anyone consider this themselves? Thanks
Next time before you ask this kind of questions
" introduce " yourself. It would be easier to answer.
Examle: I own about 22 different dividend stocks more less all sectors, some GIC, some mutual funds, potential rental properties etc and retired. So if I would buy BCE on margin and something would go wrong not much would happen. To buy only BCE on margin is very risky. I remember dotcom time 1999 averybody at work was trading to become fast rich including myself. Trading Nortel Networks, JDSU etc.Some co workers who played margins lost a tons of money resulting refinancing their mortgages, pos postponing retirements etc. BCE is not company you would go totally broke if anything happenes but it would hold you back before recovering all your money.
During the 1990s, JDS Uniphase stock was a high-flyer tech stock investor favorite. Its stock price doubled three times and three stock splits of 2:1 occurred roughly every 90 days during the last half of 1999 through early 2000, making millionaires of many employees who were stock option holders, and further enabling JDS Uniphase to go on an acquisition and merger binge. After a downturn in the telecom industry as part of the dot com bubble, JDS Uniphase announced in late July 2001 the largest (up to then) write-down of goodwill. Employment soon dropped as part of the Global Realignment Program from nearly 29,000 to approximately 5,300, many of its factories and facilities were closed around the world, and the stock price dropped from $153 per share to less than $2 per share.
So good luck with your margins.