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Risks to Consider Before Taking a Loan Against Mutual Funds
Investors should consider market volatility, margin calls, and disciplined repayment before opting for Loan Against Mutual Funds.
While Loan Against Mutual Funds offers flexibility, it carries market linked risks. A sharp market decline may reduce collateral value and trigger margin calls. Borrowers must maintain adequate buffers and avoid over-borrowing. LAMF works best for conservative borrowing and short durations. Understanding these risks helps investors use the product responsibly. Apply Now