Posted by John Behle on June 27, 2001 at 20:54:33:
In Reply to: Re: Yield and Interest rate - the difference posted by Dr Robert Romero on June 27, 2001 at 20:23:23:
The range of what a good IRR differs per person and situation. In notes my yields range from 15-40+ percent. When there is lower risk, than a lower IRR can be acceptable. Higher risk demands a higher IRR. Competition is the most important factor. If there is low competition in an area or type of investment, then I can demand a higher yield. If you are the only player on the block - you can name your own price.
Sometimes yield has to do with money available or desire. If someone has a lot of cash to invest, they may need to consider a lower yield to get it invested. If someone has less skills, desire or time available to go after the higher yields - then they may need to invest with someone else and achieve a higher yield.
IRR is a bit of a flawed formula and there are better approaches for some types of cash flows or investments. There is an article I wrote that talks about that in the "free articles" section of my website www.papergame.com
- Re: Yield and Interest rate - the difference Rebecca Sterner 09:45:06 11/22/2004 (0)
- Re: Yield and Interest rate - the difference Rachel Torguson 03:59:12 9/28/2004 (0)