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Thats is how I am understanding it Brenda. I would assume it is different if you are in the growth phase of building up the portfolio or the conservation phase. At the moment I am still well and truly in the growth phase so want to borrow as much as possible to let compounding work over the...

Thanks for all that info Keith. I don't know if I would be comfortable capitalising interest unless it was an extremely bull market, but it is one more strategy to have in the back of my mind.

Thanks for that. Which of course brings up further questions - is the capitalised interest deductable (if not being used for personal expenses)? I would assume that in order to maintain a workable LVR you would have to reinvest your dividends/distributions and the return on your capital would...

Another blonde question - what does it mean by capitalising interest on a margin loan? I have heard this often on the InvestEd forum and don't quite understand what it means, or how it works. I'm just starting to branch out into heavy investment in shares and managed funds and am still at...