Gearing / Margin Lending
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Posted by Danny on July 26, 2000 at 00:54:59:
Is there a way to track a margin lending account with Fund Manager? I have tried to think of ways to use a Cash account, but I think FM would still calculate ROI Yields as if the loan was actually my own money.
If I bought $10,000 worth of shares using $5,000 of brrowed money and after 1 year the shares are worth $12,000, then I would expect an ROI of 40% ($2,000 profit divided by $5,000 of my own money). Even better, if the loan was taken out at a rate of 10%pa, then the ROI would be 30% ($2,000 profit less $500 in interest payments, divided by $5,000 investment).