I dont know how you have arrived at this figure?? Well i do, but your calculations have been wrong. If you have $100k owing as a loan @ 7% ( either for a house or shares or etc ) and than you add to the position another $100k @ 8 % - you are not paying interest at 15% !!! Your cost of borrowing is 7.5% pa / $100k.
the dealer (ie: IG Markets) charges interest since the position is leveraged.. you only put up the "margin requirement". this is my understanding from the past, if i am mistaken and it is possible to put up the entire amount pls do let me know
If the leverage is 10:1 ( so $1k controls $10k) you will be charged interest on $9k @ 8%. I am not sure what you mean with " this is my understanding from the past, if i am mistaken and it is possible to put up the entire amount pls do let me know "
