TLDR

SyntheticFi helps you borrow at 5.83% APR using your investments as collateral without switching to another brokerage. You can save $30K+ per year borrowing $500K on Charles Schwab while staying with Schwab.

🌟Start here or talk to us to start saving money. No credit checks involved. 🌟

❓Why Borrow Against Your Investments: Continued Investment Growth + No Capital Gains Tax!

Many use margin loans or a securities-backed line of credit (SBLOC) to get liquidity from their investments without selling and incurring capital gains tax.

For example:

• You work at big tech: you have concentration stock positions that appreciated greatly. You can now use SBLOC to fund a downpayment on a house without paying 20% on capital gains tax or impacting DTI
• You are an angel investor: you can now chase the extra returns from investing in startups and not miss out on the 9% historical returns of the S&P 500.

Even Elon Musk planned to take out a $12.5B loan against his Tesla shares to acquire Twitter/X!

Additionally, securities-backed loans have no impact on your credit report.

• No credit checks; don’t show up on credit reports; no impact on DTI (debt-to-income) calculations

❌ Problem: Expensive, and Hard to Switch to Cheaper Providers

Getting a competitive interest rate to borrow against your investments requires upending your financial life. You are forced to choose between two bad options:

• either overpay thousands in interest per year;
• or take on the hassle of switching to a cheaper broker.

A real-life example: Tony 🙋‍♂️, ex-Stripe, has personally tried to borrow against his investments to pay the downpayment on his first house.

• Tony had to overpay $13K+ a year! Fidelity’s website quoted Tony 11.83%. He tried to negotiate. It took Fidelity 2 weeks to get back quoting 10%; even the mortgage was only at 7.5% at the time.
• Tony also hated switching to a low-cost broker. When searching for cheaper rates, Tony found Interactive Brokers (IBKR) offer ~6.3%. However, he would have to:
  • abandon the trading interface he is used to,
  • set up an entirely new account and wait for assets to transfer,
  • manage his retirement account in a separate brokerage,
  • and receive almost no support from IBKR. He heard they even liquidate assets without notice!

How big is this problem?

In total, credulous individual investors overpay $32B+ in interest per year to banks and broker-dealers, fueling a $1 trillion+ market with low competition. This market is similar to the size of total outstanding credit card debt, or 2.65x the size of the HELOC market.

💡Solution: Add SyntheticFi to your current brokerage platform.

Registered with the SEC, SyntheticFi acts as an add-on to your current investment platform. It allows you to borrow at a base rate + 0.5%, currently 5.83%, without switching to another brokerage account.

Get liquidity in three easy steps:

• Connect SyntheticFi to your brokerage account via a Plaid-like connection;
  • We will ask you for certain permissions;
  • We are required by law to act in your best interest - we are an SEC-registered investment advisor.
• Tell us the amount you’d like to borrow and when you’d like to repay;
• Withdraw the cash immediately!

How much does SyntheticFi cost?

• [FREE DEAL] Join our Slack community, and get your first loan ON US!
• 0.016% of your loan amount per month, up to $200 per month. This is 1/30 to 1/10 of what traditional brokers currently charge.

📝 FAQ

How can you offer the cheapest margin rate on the market?

We help you enter into an exchange-traded loan contract. You can think of it as we bring your loan contract to Wall Street, where all traders compete in real time to offer you the cheapest loan.

What is the loan you trade on exchange here?

We trade a basket of options called box spreads. These options are hedged so that they do not move with the underlying. Read more about them here, and see how Reddit traders are using them.

What is the tax treatment for the loan interest?

The loan interest incurred is always tax deductible as capital losses.

How can you let me stay with my current brokerage?

Our loan contract is supported across major brokerages. We integrate with them and trade it in your account, so you don’t need to switch.

How much can I borrow against my investment?

Margin requirements from your current broker apply. Most clients should be able to borrow up to 50% of their portfolio value. Exceptions: non-liquid investments, retirement assets, or crypto assets.

What can I use my borrowed cash for?

Money borrowed from our product can be used for any purpose, including buying more stocks.

👥 Team

We’re Joseph and Tony (left, right), the team behind SyntheticFi. Joseph worked on similar products with financial advisors when he was the first employee who built VRGL, a series-A wealth-tech startup valued at over $100MM. That inspired us to build SyntheticFi and bring cheap securities-backed borrowing rates reserved for the ultra-rich to the average person.

📢 Asks

[FREE DEAL] If you are currently using margins / security-backed loans:

• We’d love to chat and see what you think of our product! Let’s find time to meet. We will waive our fee from your first loan.
• You can also sign up on our website directly!

[Introductions] If you know anyone at financial advisor platforms, independent broker-dealers, or mortgage brokers who wants to gain revenue while giving their clients better rates:

• We’d love a referral. Our email is founders@syntheticfi.com
• Or, share our website: syntheticfi.com.