Negative Gearing (2nd Edition)

This easy-to-understand guide will help ordinary Australian investors on the stock market or in property who wish to use other people’s money to boost their returns. It examines investment objectives and risk taking in this context. It will assist everyone, from beginners and small savers to experienced investors, to understand better both the advantages and the disadvantages of leverage.

It discusses both positive and negative gearing and looks at possible changes to the tax rules and their implications. A comparison of superannuation and negative gearing as tax shelters is made. The alternative names in which investment assets can be held are analysed.

Much has already been written about the tax benefits of negative gearing when buying property. The fact that it may be used to purchase other income producing assets such as shares or units in unit trusts is often overlooked. This book also deals with the use of derivatives such as options, warrants and futures for leverage. Unlike the comments by proponents or critics of negative gearing this book is written from an independent perspective-advantages and disadvantages are given equal weight. It also contains an extensive glossary of technical terms and a detailed index.

Contents include:

    * Investment aims

    * Using other people’s money

    * Budgetary considerations

    * Gearing levels and their implications

    * Income tax aspects

    * Negative gearing explained

    * What if the tax rules change?

    * Leverage on the stock exchange

    * Some models

    * Using the equity in the home

    * Ownership of the assets

    * Social security aspects

    * Superannuation versus negative gearing

    * Negative gearing and the national economy

    * New products