Compare returns on investments here
Finally a day comes when you decide to invest part of your savings to get them a return that allows you to defray some extra expenses from day to day or simply to take advantage of the money you have relatively stopped in a checking account. But once you’ve decided to move into the world of finance and become an investor, the next step is to know where to get that desired return for your money.
In this post we make a comparator of returns that can be obtained according to the places where you decide to invest your money:
Return on Shares
The purchase of a stock offers you a return that can come in ways.
- Goodwill : It is obtained when the investor decides to sell the stock at a higher price than the one he bought. The difference between the purchase and sale price is the so-called surplus value.
- Dividends : This is the part of the profit that the company obtains as a result of its activity that is decided to be transferred to investors.
- Preferential subscription rights : When there is a capital increase, shareholders have a preferential right to subscribe the new issue, otherwise if they do not want to subscribe, they can sell them but are given preference if they wish.
Bank deposits are the most widely used savings products where money can be deposited in banks and in return obtain a return for it without taking risks. Logically, as a result of this absence of risk, bank profitability is much lower compared to other types of investments in the financial market. Among the most outstanding bank savings products are the following:
- Profitability of paid accounts : With returns ranging from 0.10% to 3% normally.
- Profitability of fixed-term deposits : This fixed-term profitability varies greatly from one bank to another, these can range from an APR of 0.90% to some that reach 5% profitability. But normally the average return on deposits is around 2.5% profitability.
Return on Investment Funds
How is the return on an investment fund calculated? The market value of each share varies according to the evolution of the values that make up the equity and is calculated daily by dividing the total equity by the number of shares in circulation at that time. The return on an investment fund is calculated as a percentage of the value settled between the date of purchase and the date of sale and can be positive or negative.
Return on 10-year bonds
The trajectory of the profitability of the Spanish bond over the last 10 years has been a continuous decline. It has gone from 4% to 2%, according to Ascensión Gómez fixed income manager TREA Capital. But how is the profitability of a state bond calculated? The coupon is not a good measure of profitability of these securities, the IRR is used, that is, the interest rate that equals the invested capital with the value of the updated flows that the investor perceives.