SMSF LRBA for Shares/ETFs

Hello everyone,

I am running an “IJH.ASX with SPA3 Investor Timing” portfolio in my SMSF. Last Friday, 8 March, IJH’s performance over the previous 15 years was 13.55% p.a. (see chart below). Given this long-term performance, I am considering leveraging my SMSF IJH portfolio.

As you may know, an SMSF must enter a Limited Recourse Borrowing Arrangement (LRBA) with the lender to borrow for assets. After some research, only one lender/product - NAB Super Lever - will lend to an SMSF to purchase shares/ETFs. (There are around ten lenders if the SMSF wants to borrow for a property.)

NAB Super Lever rates are 10% p.a. for under $250,000.

I have a few questions for Forum discussion:

  1. Does anyone have an SMSF LRBA for purchasing shares/ETFs? If so:

    a) How long have you had the margin loan, and has your experience been positive?

    b) How easy is it to buy and sell shares/ETFs that are under a LRBA?

    c) Other than NAB Super Lever, do you know other SMSF LRBA lenders/products for shares/ETFs?

  2. What are your general thoughts on borrowing for shares/ETFs in an SMSF? Is it something worth considering, or is it not worth the effort for the additional gain?

Thank you.



I haven’t used a LRBA in my Super Fund so can’t help with that.

However, here’s some food for thought. You could:

  1. use a CFD of IJH on the ASX and choose your own leverage factor. Problem with this is that you’ll pay interest on the entire position, which is not good for a B&H position.

  2. buy MVV on the US market, which is an Ultra ETF x2 of $MID. Note, there is a fee of 0.95% for this ETF.
    MVV | Ultra MidCap400 | ProShares

  1. buy UMDD on the US market, which is an Ultra ETF x3 of $MID.
    UMDD | UltraPro MidCap400 | ProShares

Of course, for the options 2 & 3 you’d need a US broker.

Also, for a B&H scenario remember the implications of the AUDUSD. Outperformance by IJH on the ASX over IJH on the ARCX is AUDUSD exchange var.

Hope that helps.

Hi Gary, thank you for the reply.

These are great alternative options to an SMSF LRBA, which I will consider.