Can you help me with the difference between interest only loan and fixed interest security? I don't get how the cashflows are reverse of each other
The basic difference is in Interest only loan -you took the loan and you are paying back interest on it for few intervals and the total lump sum in the end. whereas in fixed interest security-you have invested some lumpsum in any organisation and they are paying you regular imterest for few intevals and then the lumpsum in the end. In that sense they are reverse of each other.
