Is taking out a loan to invest in the stock market a wise investment strategy?

Save, Save, Save.

Do not take out a loan that is not tax deductible, you are wasting money, also I take it you are on about the US stock market.

It is very high at the moment, due to the Fed's Quantitative easing, this has made Bezos and a host of other Company Directors super super rich, but the market is unsustainable.  

That doesn't mean it will crash, but it will go down, the stock market always goes in cycles and at the moment it is too high, in 18 months to 2 years it could be 1/2 what it is today.

If you've saved your money, the stocks you want will be lower, but still paying those dividends, but also you will not have been paying interest to a Bank or loan company.

PS let's say you invest $10,000 in stocks, and get paid 6% in next 2 years, giving you $1,236 in dividends, but the stock has gone down 25% you will have an investment worth $8,736 plus you will have paid interest on the loan 

If you've saved $8,000 in 2 years you are well up and can start when the market is down :-)) 

Absolutely NOT. NEVER borrow money in order to risk it in the stock market. If you don't have capital of your own, you have no business investing in a risky business like the stock market. That's rule #1.  NEVER invest money you don't have. 

No.  The stock could go down in value and the dividends aren't guaranteed.  You might not have enough to pay the loan.

NEVER invest money you cannot afford to lose. Lose it all and you  Still owe the loan. 

No, it's not wise especially when a lot of people are dying, and getting very sick from the covid, or any other air born contagious stuff that exists.

I do have a lot of thousands of dollars. I could invest in the stock market, but I won't invest.

Why? I don't want to lose what I have. I have no guarantees by anyone that I won't lose whatever I put in, so I won't invest. I don't have any guarantees by anyone that I would make money too, so I am going to stick with a NO.

What do you think is going to happen to you if you don't pay back your loan?

Years you said?

WOW you really are stupid you know that.

If you take a loan then you might end up having an interest that goes with your loan, so you won't owe what you took from someone else. You would owe much more money than what you took from someone else.

My guess is you probably won't be able to pay back your loan, and I don't know what is going to happen to you next.

No, would be really dumb.  But no problem - nobody's going to make a loan like that anyway.

"I would have to make investments piecemeal and it could be years before my portfolio could yield any significant returns."

OH, so you mean like most everyone else has ever done who wasn't born into money.  They took the necessary long term steps to build their success.  I forget though that it's an "I want it now!" mentality these days.

Terrible, for many reasons.

1) You are inexperienced. Never take risks until you actually know what you are doing.

2) You assume profit. You have no contingency for losses.

3) It's called buying on margin. You must put up some of your own capital in money or collateral assets. You cannot borrow full value. And, if the stock asset value drops, the loan gets called in immediately requiring you to sell at a loss, and if you used other collateral, it gets foreclosed.

4) Well known large cap stocks are priced at exactly what they are worth at a time. Lesser known stocks can be found at values, but are higher risk.

5)  Dividends on stocks are a return of money from that company. It is money they do not use to grow their business. It isn't "free money".

6)  The loan has a interest charge, usually much larger than the dividends. If a stock does not go up in value, you lose money just by being unchanged.

7) You can control your risk better using your own money without a loan and buying stock options if you are so confident in a stock.

8) It all has tax implications to deal with.

9) Don't possibly think you are unique in this. Hundreds of thousands of people have the exact same thought and it is just as incomplete.

10) Markets in general are fairly rich in price now. You are getting in at what could be a peak in many stock prices. You could be entering the party as it's winding down. Your timing is off.

11) Finally, what makes you think you are better than professional analysts and large money managers?  

Over the years, I invested in two different real estate companies.  Both eventually went bankrupt.  You could possibly earn as much as 5% on a well managed bond mutual fund.  Stock dividends might get you 2% to 3%.  Go with what is safe until you can build enough to speculate.

In your case it sounds like a stupid idea.

In my case it was a good idea.   In 2011 I chose to take a 3% mortgage when I could have paid cash for my home.   That cash has been invested in stocks and appreciating at a ridiculously high speed instead of being tied up in my house earning 3%.  The beauty is that I still get appreciation on 100% of the value of my home even though I've invested only a portion of that.   But I digress...

Why on earth are you primarily interested in dividends?   That's not how smart people grow their net worth.  That's what conservative retired people do.

If you can afford loan payments, just use that cash flow to invest instead.

No one is going to give you a large unsecured loan to use for stock investing.   And even if they did, what makes you think your return on dividend stock investing (haha!) will beat your unsecured loan interest rate especially after you factor in taxes on the dividends?