InvestorQ : What is the entire purpose of a loan against share/securities (LAS)?
Niharika Kamble made post

What is the entire purpose of a loan against share/securities (LAS)?

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Priyanka Singh answered.
3 years ago
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Loan against securities/shares (LAS) is a solution to an urgent requirement of finance. It is not the funding mechanism of an expense which was long expected.

In loan against securities (LAS), a lender gives you a loan against securities held by you. Thus, this is a secured loan as the lender has the collateral of your shares/securities, if you do not pay back or default on your loan.

LAS takes care of all one’s investment needs as well as personal needs. It helps meet your contingencies, while allowing you to subscribe to primary issues and rights issues.

Thus, by taking a loan against securities (LAS), you only pledge your stocks or securities. You DO NOT sell off your securities

LAS is the ideal way to get liquidity or liquid cash, without liquidating (or selling) them.

Opting for LAS makes sense when you are expecting a certain sum of money after a few months but require some money in the interim.

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