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  1. #1

    Default NPV, IRR, does anyone use these for investment analysis

    Just wondering if anyone uses these: NPV or IRR for investment analysis.
    Just came across in myself and whilst I don't think it is the be all and end all, I think it is a good indicator.

    just really getting the hang of applying it really and am currently trying to work out the difference between IRR and gross yield?

    If anyone uses it would be interested to hear their thoughts.

  2. #2
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    An accountant might be interested in such stuff but I can't imagine any investor bothering with that.
    There's more important things to look at when investing.

  3. #3
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    For me, gross yield is all I calculate.

  4. #4
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    paralysis by analysis I think.

  5. #5
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    Default

    Isn't IRR infinite when using OPM on your IP portfolio?
    DFTBA

  6. #6
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    Quote Originally Posted by Gary Lin View Post
    For me, gross yield is all I calculate.
    Gary, why do you use gross return and not net return?

    I reckon the latter is more important? But then I tend to try and do more investing in the C&I world where this is all that is used. So maybe I'm just used to it.

    But surely you'd use net rent so that if rates, insurance etc. go up (and they always do), you know what you're actually making?
    Squadly dinky do!

  7. #7
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    Quote Originally Posted by deepu View Post
    Just wondering if anyone uses these: NPV or IRR for investment analysis.
    Just came across in myself and whilst I don't think it is the be all and end all, I think it is a good indicator.

    just really getting the hang of applying it really and am currently trying to work out the difference between IRR and gross yield?

    If anyone uses it would be interested to hear their thoughts.
    A good indicator of what?
    You can't work out the difference between IRR and yield because they are total unlrelated!!

  8. #8
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    Quote Originally Posted by Davo36 View Post
    Gary, why do you use gross return and not net return?

    I reckon the latter is more important? But then I tend to try and do more investing in the C&I world where this is all that is used. So maybe I'm just used to it.

    But surely you'd use net rent so that if rates, insurance etc. go up (and they always do), you know what you're actually making?
    I actually have a detail spreadsheet that works out all the expenses etc and show me how much per week I have to top up or make gains.

    But for simple comparison between properties I buy, gross yield is good enough in most cases, as the rates are similar, out goings are similar, and no body corp these days.

  9. #9

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    Quote Originally Posted by orion View Post
    A good indicator of what?
    You can't work out the difference between IRR and yield because they are total unlrelated!!
    If you were comparing 2 investments or more it would indicate which one was better. But as I said it is just an indicator. Wayne might have hit the nail on the head when he said "paralysis by analysis".


 

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