Who is Maine Streets Securities?
Maine Streets Securities collateralized stock loans give investors another mechanism to realize near-immediate liquidity from the unrestricted, publicly-traded stocks that are in their portfolios. In a typical stock loan, the investor will borrow a sum of cash that is a percentage of the value of the collateral stock that the investor will pledge to secure the loan. Most stock lenders will lend from 20% to 70% of the value of the stock. The final loan-to-value that a lender will offer will be a function of the fundamental financial strength of the issuer of the stock and the average daily trading volume of that particular stock.
Most collateralized stock loans are for terms of between one and five years. The borrower pays simple interest during the loan term and repays the loan principal balance on the loan maturity date. Alternately, the borrower can elect to retain the full principal balance, in which event the lender assumes full possession and ownership of the collateral stock and the transaction terminates with no further liability on the part of either party.
As with all transactions involving publicly-traded stock, a borrower should always consult his or her financial, legal, tax, and accounting advisors to understand the full implications of a stock loan and a potential default before engaging in a collateralized stock loan transaction. A stock loan lender will facilitate a transaction but will not make or provide any warranties or representations on how the transaction will affect the borrower’s financial profile.
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