3 ms·
When they said "investment.interest" I think they meant investment return percentage. I don't think they were advocating for investing on margin and maximizing
by slayed0 11y ago
When they said "investment.interest" I think they meant investment return percentage. I don't think they were advocating for investing on margin and maximizing leverage/risk, but rather deciding whether to put your $ towards your debt or towards an investment.
- 300bps 11y agoI don't think they were advocating for investing on margin and maximizing leverage/risk, but rather deciding whether to put your $ towards your debt or towards an investment. It's the same thing. If it makes sense to keep $300,000 in debt to keep a $300,000 investment then it makes sense to go into $300,000 debt to make a $300,000 investment. Whether that debt is a mortgage on a primary residence for a tax-equivalent-rate of 2.75% or margin interest for a tax-equivalent-rate of 1.63% makes little difference. This is what people who keep a high mortgage and invest the proceeds of that mortgage don't get. They are doing the equivalent of investing on margin which is extremely high risk. They could lose a large portion (or even all) of their investment and still be left with the debt.