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To setup your share portfolio, you are considering a Margin Lending product with an LVR of 70%. a) If you contribute $60,000 of your


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To setup your share portfolio, you are considering a Margin Lending product with an LVR of 70%. a) If you contribute $60,000 of your own cash, what is the maximum amount you can borrow? b) Assuming you borrow the full amount and there is a 10% buffer, analyse the financial/ portfolio management effect under the following market conditions: i. A 5% increase in the portfolio value; ii. A 5% decline in the portfolio value; iii. A 15% decline in the portfolio value. c) Discuss the taxation and financial principles which have been utilized by the financial engineers of the Margin Lending product.

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