Financial leverage can amplify the result of investment. No loss will increase at a fixed rate. Therefore, users must carefully analyze the income risk of investment projects.

When using the tool of financial leverage, cash flow must take this aspect into account, otherwise once the capital chain breaks, even if the final result can be huge income, it must be raised.

Operating real estate investment with loan products is actually simply renting out others. Even if it can be predicted that the trend of real estate in the next stage is very optimistic, it is impossible to eat infinite space with financial leverage in order to allow the use of financial leverage.

In order to protect their own funds, institutions must consider whether the loan customers can pay and whether the loans can be recovered if there is a problem in the customer's capital chain.

Second, what is financial leverage?

Financial leverage is the use of leverage to invest, which can amplify the investment results after use. Whether the final result is profit or loss, it will increase in a fixed proportion. Therefore, before using this tool, investors must carefully analyze the income expectations and possible risks in investment projects.

When using the tool of financial leverage, the expenditure of cash flow may increase, which must be taken into account. Otherwise, once the capital chain breaks, even if the final result can be huge profits, it must face the end of early withdrawal.

Using loan products to operate real estate investment is actually simply to rent other people's funds to make money for yourself. However, even if we optimistically predict the trend of real estate in the next stage, it is impossible to eat real estate without restriction with financial leverage. In the initial stage, investors have little room to use financial leverage.

Because the source of loans is financial institutions, in order to protect their own funds, financial institutions must consider whether the loan customers can afford the monthly repayment, and whether the loans can be recovered if there is a problem in the customer's capital chain.

Third, what is financial leverage?

The basic principle of financial leverage is not complicated, but how to apply a principle to a practical example? Like real estate?

Using loan products to operate real estate investment is actually simply to rent other people's funds to make money for yourself. However, even if we optimistically predict the trend of real estate in the next stage, it is impossible to eat real estate without restriction with financial leverage. In the initial stage, investors have little room to use financial leverage. The reason is simple, because the source of loans is financial institutions. In order to ensure the safety of their own funds, financial institutions must consider whether the loan customers can afford the monthly repayment, and whether the loans can be recovered if there is a problem in the customer's capital chain, because it is difficult for investors to borrow a high proportion of loans from the real estate they invest in, even if there is one. There is also a much higher loan cost. Secondly, the lender will consider whether it can bear the monthly repayment pressure according to the income of the lender, and the judgment of repayment ability depends entirely on all the determinable income of the lender, such as salary and rent. On the other hand, investors' uncertain income, such as property appreciation and tax deduction, cannot be included in investors' repayment ability as income.

Here is an example of using financial leverage to invest in real estate. To simplify the example, let's assume that the investor's income is 0,000 (before tax) per year, with a salary increase of 0,000 per year. Real estate is increasing at a rate of 8% every year. The interest on bank loans will remain unchanged at 7.6% forever.

After a period of hard work, investors have a deposit of 0,000 yuan. At this time, he decided not to rent a house and began to provide a house for himself. 0,000 down payment. According to the down payment of 20%, he can buy a house of 0,000 yuan, with a loan of 0 and weekly repayment 1.76. The tax rate calculation formula he is applying now is: tax payable = 258,030% (60,000 _ 25,000) = 0.080. So his net income is 60000 _ 13080 = 920. So his weekly income is 2.3. After deducting the weekly repayment, the remaining amount is 902.3_65 1.76=0.54. Because I have my own residence, my weekly consumption is greatly reduced, assuming that it is 0 per week. Moreover, in order to reduce my repayment pressure, this investor rented out other spare rooms in his house. Assuming that he can earn 0 per week, the investor's weekly balance is now 0.54. Investors use the prepayment and multi-deposit and multi-withdrawal functions of financial institutions to prepay all weekly balances.

After three years, the investor's income increased to 0,000, and the property value increased to 0,000. The loan balance is 7,851.6 (for the convenience of calculation, the influence of compound interest is ignored). Now the actual loan ratio is 46.4%. Although I have said in the last article that ordinary value-added properties need to be sold if they want to be realized, in fact, if the loan ratio is increased by refinancing, the value-added part of the property will be realized (because the loan ratio has been decreasing during the loan period). So now the cash limit that the lender can propose is 8, 148.4. In these three years, investors' deposits have simply doubled, and there are still 4,000 yuan equivalent to deposits in real estate, and the total assets have increased by 2 148.4. The net income of wages in these three years is 7060. After deducting the expenditure of 0 per week and paying the rent of 0 per week if you don't buy a house, the actual expenditure in these three years should be 800. If you don't buy a house, the investor's asset appreciation is 0,260. So in these three years, investors' income has more than doubled.

At this time, investors consider investing in another property with the 7,851.6 proposed by real estate cashing (refinancing). Now he has two choices, buying a house in full or buying a house with a loan. Let's compare the differences between the two methods after three years. First of all, the investor still has a loan for the first house, so his weekly repayment amount is 8. 18. Now the lender's net weekly salary is 023.46. So now his book says the weekly balance is 5.28. Because the second house is for investment, the rental income of this house can be used to apply for a loan.

According to the above statement, if he buys a house in full, he can buy a property of 0,000. The weekly rent is 0. The weekly net expenditure of investors is still zero, and all the remaining funds are used to repay the loan in advance. The situation after three years is that the remaining loan is 8,227.76. The first property added 0,000 yuan, and the second property added 2,000 yuan. Considering the problem of real estate depreciation, assuming that the real estate depreciates by 3% every year, that is, 000 yuan, the income tax can be deducted. The taxable income for three years is 2800 yuan, and after deducting the depreciation expense of 1000 yuan per year, it finally gets 5800 yuan. The tax payment formula is:17,85040% (ordinal income _ 750,000). Because the investor's salary plus income is higher than 0,000, he has to pay more taxes. All taxes for three years are 350. The asset appreciation after three years is: (740,000-620,000) (372,000-300,000) (496,000 _ 465,438+08,227.76) = 9,772.24.

Suppose investors choose to buy an investment house with a loan ratio of 60%, then investors can buy 0,000 houses. The loan amount is 0,000. The weekly repayment amount is 6. 1 1, assuming that the weekly rent is 0. In this way, it should be no problem to repay two loans with income, and it is also very simple to apply for a loan of 60%. Because the second house is used for investment, depreciation and loan cost can be used for tax deduction, so the income that can be deducted every year is 700 yuan. The total income for three years is 690007200075000700523 = 5200, and the individual tax should be 630. However, due to deducting the cost of investment housing, the actual tax payable is 580 yuan, and the tax is less than 60,000 yuan. In fact, this means that the government is helping investors pay some loan interest for investing in housing! According to the original idea, all the cash balance was repaid in advance. After three years, the total income is 325200300523 = 2000, the tax is 580, and the daily expenditure is 600. The weekly net income is 75.77, the total weekly loan repayment is 54 1, and the balance is 4. All of them paid off the first home loan. So after three years, the total value of the house is 740 thousand, 930 thousand = 670 thousand. The first mortgage still owes 9704.32 yuan, the second mortgage still owes 82 17.32 yuan, and the total net assets are 2078.36 yuan. Compared with the previous three years, the assets increased by 9929.96, more than twice the previous situation.

4. What is leverage in finance?

Leverage in finance refers to liabilities.

For example, an enterprise has its own funds of 654.38+0 billion yuan and various debts of 9 billion yuan such as loans and accounts payable, so its total assets are 654.38+0 billion yuan. We say its financial leverage is total assets-self-owned funds = 654.38+00 times.

It can be seen that the higher the leverage, the greater the business risk. If an enterprise does not borrow money, but operates with the owner's own money, then his leverage is zero.

For another example, to buy a standard futures contract, the face value is 1 1,000 yuan, and the required margin is 1 1,000 yuan. Theoretically, an investor needs 1 10,000 yuan to prepare delivery contracts here, but if he is a speculator and is very accurate about the trend, he can spend an extra 9,000 yuan to buy nine contracts, which is equivalent to using 1 10,000 yuan to pry. Call it "leverage", that is, with 1 times the capital and 10 times the assets, the leverage ratio here is 10.

For reference.