Leverage of 1.4 times
Borrowed funds equal to 1.4 times own funds, so the total invested is 2.4 times own funds.
This one is not written up yet
The definition above is the short version. A full explanation — how it works, a worked example and the exam traps — is still being written. In the meantime the chapter below covers it in context.
Written up from the same chapter
- Co-payA fixed percentage of every admitted claim that the insured pays out of pocket — a proportional share of the loss, applied after any deductible, in exchange for a lower premium.
- DeductibleThe portion of a claim the insured bears before the insurer pays anything — a fixed rupee threshold that lowers the premium and keeps small claims out of the system.
- PMT functionThe spreadsheet function that converts a target corpus into the fixed periodic saving needed to reach it — the arithmetic behind every "how much should I invest a month" answer.
- PV functionThe spreadsheet function that converts a stream of future payments into the single lump sum needed today — the tool the workbook uses to size a retirement corpus and a life insurance cover.
Where this is taught
Free preparation for NISM Series X-B← All terms