Gearing will magnify the returns (both positive and negative) to investors and may provide significant taxation advantages depending on your the investors circumstances.

 

Gearing

Gearing will magnify both the upswings and downswings of an investment. For many investors this is seen as a distinct advantage, the potential for high returns.

 

The other advantage is that the interest payments for a geared investment are tax deductible, making them a very attractive after tax proposition.

 

There are currently a number of 100% geared investment opportunities. With these investments your commitment is regular tax deductible interest repayments, any upside on the investment is yours, and the downside is usually protected with a capital guarantee.