In Reply to: Ironic posted by Frihed89 on April 29, 2009 at 04:56:30:
Lenders get a fixed return and, unlike equity holders, do not share in the upside of a successful venture if its valuation increases. In exchange, they get more protections in the event of insolvency. Equity holders take the risk of losing their invested capital, but get all the upside if the venture goes gang busters. What is wrong with that? It's just logical to me.
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Follow Ups
- It's called risk/reward and is fundamental to how investing works - JoshT 08:49:28 04/29/09 (6)
- the risk other peoples money and get rewarded if they win more or lose it -t - Sordidman 15:54:26 04/29/09 (1)
- What exactly are we talking about? - JoshT 17:00:47 04/29/09 (0)
- Because, seemingly... - jusbe 10:37:26 04/29/09 (3)
- Yes, I noticed, "big j" - JoshT 11:14:00 04/29/09 (2)
- This is what I meant NT - Frihed89 15:46:46 04/29/09 (1)
- What is "this"? - JoshT 17:02:59 04/29/09 (0)