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I am trying to work out how gearing is calculated on a Fund I am looking at. It has an example that says if the Fund is worth $10m and gearing is 35% then the 'gross' value of the fund is $15.38m. However when I calculate it I get a gross value of $13.5m (I did 35% of $10m and added this to the $10m value of the Fund)

Can someone please tell me what I am doing wrong here?

Many thanks

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    0.65*15.38 equals 9.997
    – mhoran_psprep
    Commented Jan 24, 2018 at 12:30
  • 1
    If OP is a personal investor, then this is on-topic for PF.
    – RonJohn
    Commented Jan 24, 2018 at 18:09

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Rearranging the @mhoran_psprep comment: $10M / (1 - 35%) = $15.38M.

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