Should You Use Leverage to Invest?

When the markets are roaring, it can be tempting to use margin when investing. But Jim Chuong—aka The Lazy Canadian Investor—explains why he refuses to touch debt and how that policy has made him more content.

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Do you use leverage at all with your equity investments, with your ETFs, or do you stay away from that? You don’t use a margin account. You don’t use any borrowed money at all.

I don’t use any margin. I remember everyone around me told me to use margin though. They were like, um, I remember when I was buying US real estate and I was buying, or the stock market, they’re like, you should use your margin balance. You should use debt. You know, um, even my wife kind of said, anyway, my wife was like, you should borrow more.

We can buy, you know, double the amount of houses. I was like, listen. You don’t understand my, my perspective when it comes to debt. If I make good money using debt, I am likely to get hooked. It’s just not something I want to be hooked on. Like, ok, I’m not the richest investor. I’m not the best looking investor.

Arguably, no, I mean I arguably, always a key word there. Key word.

I’m the lazy investor, so lazy means I don’t want phone calls.

Right.

I don’t want margin calls. I don’t want water damage calls. I’m lazy. I wanna invest. I might have less, but I’m happy and that’s all I want. I’m not looking for moonshots.