It magnifies both your gains and your losses. Let's jump to the end of the sixteen years. Even a very conservative level of margin can boost the overall return enough to make it worth considering. Margin investing can raise your overall portfolio returns over time if you are able consistently to achieve a return greater than the interest rate you must pay to borrow the money. Keep in mind that margin's power is equally effective in bear markets, though.
Margin exaggerates both good and bad results.
In the long run, however, an approach like Investing for Growth seems like a classic candidate for a little leverage. The Motley Fool. All rights reserved.