Opening up a Commsec account in 2009 - no more CDIA

[matty2.0]

Hi guys,
I'm currently in the process of opening up a Commsec account.
They no longer have the CDIA account, now it's just a (i)cash management account and a
(ii) share trading account.

I'm a bit confused as to why there are 3 accounts in total, as the cash management account has two linked accounts; the cash account and the "commsec investment account".

Also margin lending; will they let me have margin lending if my opening balance is only around 10K? The minimum margin loan is 20K which is double my opening balance.

Anyone have anything they could add?


Cheers.

 

[nulla nulla]

Re: Opening up a Commsec acct in 2009 - no more CDIA

Respectfully, if your questions are any indication of your level of experience, I would recommend you leave the margin lending account until after you have a greater understanding of investing/trading in shares.
There are some good books arround in respect of whether or not to use margin loans (and to what gearing levels/extent if any) to increase the value of your portfolio. Researching this area before jumping in could save you a motza, particularly in the current economic climate.

 

[matty2.0]

Re: Opening up a Commsec acct in 2009 - no more CDIA

Respectfully, if your questions are any indication of your level of experience, I would recommend you leave the margin lending account until after you have a greater understanding of investing/trading in shares.
There are some good books arround in respect of whether or not to use margin loans (and to what gearing levels/extent if any) to increase the value of your portfolio. Researching this area before jumping in could save you a motza, particularly in the current economic climate.

Yeah, I'm an experienced investor, however most of my investments have been overseas (US and Europe/UK markets). I'm only now just starting to dip into the ASX markets.

However when I applied for the margin loan I thought that they could give me a small loan like 5K, however the minimum option is only 20K so I had to go with that.

Maybe I'll ring them up and change it? Will they still set up my account but without the margin loan?

 

[jackson8]

Re: Opening up a Commsec acct in 2009 - no more CDIA

hi there this is straight from the brochure


How it works
CommSec Cash Management has three components:
CommSec Cash Account is an everyday transaction account with no monthly
account fees which you can use for all your cash requirements, including direct debits
and credits. You can also use it to settle your share trades directly and enjoy low internet
preferred brokerage rates.*
CommSec Investment Account is a high-interest account linked to your CommSec
Cash Account. You can also use our unique AutoSweep feature to transfer funds to your
Investment Account from your Cash Account automatically, making the most of the great
interest rates.
CommSec Debit MasterCard ® offers you global access to your cash, and fee-free
ATM withdrawals via Australia’s largest bank ATM network. You can also use it to make
purchases anywhere in the world, online or over the phone wherever the MasterCard
logo is displayed.
* To be eligible for Internet Preferred trading, you must be CHESS-sponsored by CommSec and settle your trades through
a CommSec Cash Account,



okay i have cash in the cia while its in there it earns interest 4.25% or somewhere around there
when a trade needs to be settled or margin required i transfer funds into cca which is where trades are settled from
the cca has very little if any interest earnings so keep funds in cia until needed .transfer from one account to the other is instant.

transfer from your normal bank account to cca or cia may take 1-2 business days

hope this helps

you dont need a margin loan to set up the account and i have found the debit mastercard to be quite handy : no fees involved

download the cash management account pdf fromt their site

 

[matty2.0]

did you guys set up the account with margin loans?
if so what was your opening balance? basically what i'm trying to get at is what sort of loan vs. equity ratio they will allow for margin loan accounts. as it stands my debt/equity ratio is like 2:1 ... I may have to put up more equity but i prefer not to, as that means taking some funds out of my other brokerage accounts ... which are all overseas and occur FX/Transaction fees for the service.

 

[builder2818]

When you set the account up with comsec, you will have a share account, the cash account and the investment account where you earn interest on your money deposited in that account.

If you opted for a margin loan as well, they will give you a margin loan account that you buy and sell shares through as separate from your share trading account. You can just apply for the $20000 margin loan and it will be sitting in your account until you decide to use it. You will not be charged interest. When you want to buy shares and leverage using a margin loan you will need to just transfer money from your cash or investment account into your margin loan account. You then purchase the shares through your margin loan account and comsec will determine a LVR and it is up to you maintain this. You will only be charged interest on the part of the loan you are using.

Once it is set up you will know what I mean. Everything you want to do from switching between accounts to transferring money between accounts is all displayed in the tabs at the top of the websites screen.

 

[So_Cynical]

basically what i'm trying to get at is what sort of loan vs. equity
ratio they will allow for margin loan accounts.

Commsec list of Accepted ASX Listed Equities and LVR's...April 09

http://images.comsec.com.au/MarginLending/Accepted_Shares.pdf

 

[matty2.0]

Ah ... great thanks guys.
So they should be able to set it up for me then (margin loan account). As the margin loan account just sits there until we decide to use it.
I'll send my application in and see how it goes.

I usually don't borrow more than 25% of my equity amount anyways.