If your equity portfolio is just sitting in your Demat account, it’s time to put it to work. Yes, you can take a loan against your stock portfolio and it’s one of the smartest ways to access large funds without selling your investments. Whether you need liquidity for business, education, or urgent expenses, your listed securities can unlock it without tax implications or wealth disruption.
Did you know? You can raise funds up to Rs. 100 crore by pledging your shares and still retain ownership benefits like dividends and capital appreciation.
This way, your investments continue to grow while giving you access to high-value credit whenever you need it. Apply now and let your portfolio fund your next big move.
Did you know? You can raise funds up to Rs. 100 crore by pledging your shares and still retain ownership benefits like dividends and capital appreciation.
This way, your investments continue to grow while giving you access to high-value credit whenever you need it. Apply now and let your portfolio fund your next big move.
What is a loan against shares and how does it work?
A loan against shares (LAS) is a secured credit line where you pledge your listed equity shares or mutual funds to avail funds. Instead of selling your holdings, you simply offer them as collateral and draw money as needed from an approved loan limit. This allows you to maintain your long-term investments while still accessing liquidity for urgent or high-ticket expenses. You continue to retain ownership of your portfolio, ensuring your wealth keeps growing.
When you apply, the process involves pledging your holdings electronically. Once your shares are locked in with the lender, a sanctioned credit limit is offered, usually a percentage of your portfolio’s current market value. You can withdraw any amount within this limit, and interest is charged only on the amount you use, not the entire limit. Additionally, you can top up or reduce your pledged holdings as your portfolio value fluctuates, giving you flexibility and control.
Need access to funds without touching your savings? Apply for loan against shares now
Loan-to-value (LTV): Ratio explained
The Loan-to-Value (LTV) ratio is a critical metric that determines the amount you can borrow against the market value of your pledged securities. LTV not only impacts the sanctioned loan amount but also plays a key role in margin maintenance and risk management.
- LTV percentage: Typically, around 50%, depending on the type and liquidity of your securities.
- Security type matters: Blue-chip shares or debt-free mutual funds attract higher LTVs.
- Dynamic calculation: LTV is reviewed periodically and adjusts with market fluctuations.
- Margin call trigger: If market value falls and LTV exceeds the threshold, you may be asked to top up securities or repay partially.
- Higher LTV = Greater borrowing power: But also requires careful portfolio monitoring.
