Hi Tim - since BKW and SOL are in large part the same thing...

Hi Tim - since BKW and SOL are in large part the same thing thanks to the cross-holding, I suggest basing a choice of which to sell on a simple sum of the parts calculation. If SOL does go crazy and run up to $30 again leaving BKW sub-$20, I suggest you short it. They own each other, so long one and short the other is a natural hedge and very low risk.

I generally concur with others that leverage and stocks isn't a great combination, but depending on your circumstances, and the shares held, a small amount of leverage may be sensible.

For example, let's say your mortgage rate is 4%, and includes an over-draft style facility which you can run up and down as you wish for say, $100k worth of your mortgage, with the rest being fixed for various terms.

You could draw $100k out of your brokerage account, and avoid using the $100k revolving bank facility. Interactive Brokers would charge you 1.5% for this money, so a saving of $2500pa.

The risk in this situation is that the value of your portfolio falls, and your broker sells your stock (at the bottom!). Obviously, you should take a conservative approach. Don't use more than say, half of your available leverage. That way you can absorb a 50% drop in the value of your stock before it is liquidated on your behalf. However, the real safety device in this is the revolving bank credit. If things get really hairy in the market, just draw it down to repay your broker and pay 4% instead of 1.5% until normality returns. Having the bank credit available but unused protects you.

Further safety can be engineered in by selecting relatively conservative stocks which are unlikely to drop off the list of marginable positions or undergo wild swings in price. Sounds like you already check this box.

In general, if your returns to equity are higher than your mortgage debt rate, it makes sense to retain the debt. I.e., don't rush to pay off the mortgage. That said, if you don't have reasonably good visibility of your forward interest rates, there may be comfort to be had from reducing the debt. You can always use a bit of broker debt at times when rates are low and ease it back when they are higher.