Is it illegal to borrow money for stock trading?
It is illegal for users to speculate in stocks with loan funds, but it is not illegal. No matter what platform we apply for a loan on, there are generally strict regulations on the use of the loan. For example, bank loans are mostly divided into mortgage loans, business loans and consumer loans, while online loan products are mostly consumer loans, and the funds will be relatively small, but these loans will be clearly stipulated and cannot be used for investment activities such as buying funds, futures and stocks.
According to the requirements of the regulatory authorities, the applicant shall not use the loan funds in the production, operation and investment fields that are explicitly prohibited, and the borrower shall provide a certificate or statement on the use of the funds. Almost all banks, lending institutions, etc. , it is expressly stipulated that loans will flow into the stock market, and it is also expressly stipulated that borrowers are not allowed to use their own loans to buy stocks.
In this regard, the bank will strictly review and monitor the funds and understand our purpose during the review. If it is used for stock trading, once it is discovered, it will definitely refuse to lend. If the loan has been approved, it will be recovered. If we use fake materials to defraud loans, then the bank will also sue us to court for defrauding loans.
And for us personally, investors use loans to buy stocks, so this part of the funds will have a return period, we can not control the funds well, but also bear interest. Generally speaking, this will produce great psychological pressure and increase the risk of stock trading.