Generally speaking, the cost of equity capital is greater than the cost of debt capital, because your cost in debt financing is-interest expense, which is paid before tax and has the effect of tax deduction; The cost of equity financing is the dividend paid, which cannot be deducted from tax, so the cost of debt financing is lower than that of equity financing.
1. Compared with long-term loans, long-term loans have higher interest rates, so the cost of short-term loans is lower than that of long-term loans;
2. Compared with bonds, the borrowing cost is lower than bonds, so the borrowing cost is lower than bonds;
3. Compared with common stock, the retained earnings do not consider the financing cost, so the cost of retained earnings is lower than that of common stock;
4. Compared with common stock, the dividend of preferred stock is fixed, while the dividend of common stock is generally increasing, so the capital cost of preferred stock is lower than retained earnings and common stock;
5. The capital cost of absorbing direct investment is higher than that of common stock, because the shareholders' meeting requires a higher rate of return in a private way.
It is not difficult to say that investment and financial management are difficult, and it is not simple to say that it is simple. For people who know how to manage money, what kind of financial products to buy and how to allocate their own funds have come to a conclusion without much consideration. But for people who don't know how to manage money, even if they have the heart to manage money, they will always hesitate, and as a result, they waste a lot of time. You know, in financial management, time is money. If you don't fully grasp the time, it is tantamount to wasting money.
1. If you want to choose wealth management products, you must proceed from your own situation and consider your own economic ability and risk tolerance. It is not that the higher the income, the better the wealth management products. Choosing the right financial products and obtaining stable income is the correct way to manage money. When you choose a wealth management product, its risk, safety, liquidity and so on should be taken into account. Of course, its income must also be taken into account.
2. If you don't have much money, don't want to take too much risks, and need to use money at any time, choose financial products with capital preservation and current demand, such as money funds, reverse repurchase of government bonds, and bank deposits. These are the things you should choose when choosing financial products.
3. If you have sufficient funds, little liquidity demand and can take certain risks, you can pursue some high-risk and high-yield investments, such as stocks, gold and futures. These are the directions you can choose when choosing wealth management products.
4. Summary: Make clear your risk preference. If you can't stand the loss of more than 10%, don't buy high-risk wealth management such as stocks, futures and foreign exchange. Know whether your funds need liquidity. Some wealth management products have high returns but poor liquidity. You can look at the deposit products issued by banks in Internet finance, which are higher than ordinary deposit banks, and some products have good liquidity.