Geared products can enhance risk/reward relationship
Geared investment strategies are starting to pique the interest of investors, given the low interest rate environment. Investment banks have introduced numerous innovations to help protect clients who choose to borrow to invest.
Reserve Bank of Australia numbers show products such as margin loans, use of derivatives and warrants are starting to pick up. But they are coming off a low base as investors turned their backs on higher-risk financial instruments after the global financial crisis.
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