What are the risks of Portfolio LVR? Can I go into a margin call as a result of selling a security?

Portfolio LVR increases your portfolio's lending value, which you can use to increase your investment exposure. This may have the effect of multiplying any losses, as well as gains, in your portfolio.

If your portfolio qualifies for Portfolio LVR, trades you place may significantly affect your gearing ratios. For example, if you sell down to fewer than 5 approved securities in your portfolio, your portfolio will be classified as 'undiversified'. As a result, you will only receive standard LVRs or single stock LVRs. Further, the lending value of bonus stocks will fall to 0%. This may affect your security value and could potentially put you in margin call.

We strongly recommend that before placing sell orders on your portfolio, you use the what-if calculator on our website to determine the impact the sale will have on your loan position.

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