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Building Your Capital
Building Your Capital
Building your capital is the process of growing your wealth over time through strategic financial decisions. It involves using tools and techniques that maximize your resources while managing risk.
This approach combines smart borrowing, disciplined investing, and risk management to accelerate wealth creation and achieve financial independence.
What is Refinancing?
What is Refinancing?
Refinancing means replacing an existing loan with a new one, usually to get better terms.
Goal: Lower interest rates, reduce monthly payments, or change the loan duration.
Example: Switching your mortgage from 6% interest to 4% can save thousands over time.
Benefit: Improves cash flow and frees up money for investments or savings.
What is Leverage?
What is Leverage?
Leverage is using borrowed money (debt) to increase your investment potential.
How it works: You invest $100,000 but borrow $50,000, so you control $150,000 worth of assets.
Upside: Amplifies gains if the investment performs well.
Downside: Increases risk—losses are also magnified, and you still owe the debt.
How Income Investing Works
How Income Investing Works
Income investing focuses on generating regular cash flow rather than just capital appreciation.
Examples: Money Market Funds, Dividend-paying stocks, Bond Funds, ETFs, Real estate & Fixed Deposits.
Purpose: Provides predictable income streams, often for retirement or financial independence.
Risk vs Return
Risk vs Return
Risk and return go hand in hand—the greater the potential reward, the higher the risk involved. Investments range from low-risk, low-return options like Money Market Funds, Dividend-paying stocks, Bond Funds, Real estate & Fixed Deposits to moderate-risk choices such as dividend stocks and balanced funds, REITs and high-risk, high-return opportunities like stocks, leveraged investments, options and futures, commodities trading and cryptocurrencies. The key is to diversify your portfolio to balance risk and reward in line with your financial goals and time horizon.
Your Investable Capital Universe
Your Investable Capital Universe
Outcome: Selected Securities for Investment & Optimized Investment Portfolio
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