Profits Interest

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Dictionary Says

Definition of 'Profits Interest'

A monetary right awarded to the general partner, investment manager or a service provider of a partnership. The award consists of receiving a percentage of profits from a partnership without having to contribute capital to the partnership.  Profits interests are often criticized as recipients can generate large profits for themselves while not incurring sufficient risk.
Investopedia Says

Investopedia explains 'Profits Interest'

This method serves as an incentive for partners to become more proactive in pursuing bigger and better profits thus contributing towards the companies' growth. This situation presents a tax benefit in that beneficiaries of this instrument can be taxed under long-term capital gains versus the higher federal tax rate.
Search results for

'Profits Interest'

  • What Investors Should Know About Interest Rates

    http://www.investopedia.com/articles/fundamental/04/061604.asp
    ... a high interest environment. Otherwise, the bloated interest expense will
    eat away at its profits. Lower profits, lower cash inflows ...

  • Why Interest Rates Matter For Forex Traders

    http://www.investopedia.com/articles/forex/08/interest-rates.asp
    ... As currency exchange rates move, traders have the ability to maximize profits -
    not just through interest accrual from carry trades, but also from actual ...

  • The Chinese Wall Protects Against Conflicts Of Interest

    http://www.investopedia.com/articles/analyst/090501.asp
    ... for the increased concern about conflicts of interest. This change abolished the
    fixed-rate minimum commission on security trades, causing profits to plummet ...

  • Leveraging Leverage For Bigger Profits

    http://www.investopedia.com/articles/stocks/10/leverage-investing-strategy.asp
    Leveraging Leverage For Bigger Profits. ... If you are carrying other high-interest debt
    (such as credit cards), you should not be investing in the market; saving ...

  • Safeguard Your Way To Profits

    http://stocks.investopedia.com/stock-analysis/2011/Safeguard-Your-Way-To-Profits-SFE-PATH-TNGN-BMO1020.aspx
    ... Safeguard Your Way To Profits. ... However, two are public: NuPathe (Nasdaq:PATH), a
    specialty pharmaceutical company with an 18% interest, and Tengion (Nasdaq:TNGN ...

  • Different Shades of Banking Profits

    http://stocks.investopedia.com/stock-analysis/2009/Different-Shades-of-Banking-Profits-GS-WFC0416.aspx
    ... FICC. Specific mention of record profits in interest rate products and
    commodities was mentioned in Goldman's earnings release. Net ...

  • Use ROA To Gauge A Company's Profits

    http://www.investopedia.com/articles/fundamental/04/012804.asp
    ... Compare ROA to the interest rates companies pay on their debts: if a company is
    squeezing ... If we treat ROA as a ratio of net profits over total assets, then two ...

  • Using Interest Rate Parity To Trade Forex

    http://www.investopedia.com/articles/forex/08/interes-rate-parity.asp
    ... on the interest rate differential between two currencies, otherwise arbitrageurs
    would step in to take advantage of the opportunity for arbitrage profits. ...

  • Short Squeeze The Last Drop Of Profit From Market Moves

    http://www.investopedia.com/articles/stocks/08/short-squeeze-profits.asp
    ... This is because an investor who shorts stocks only profits when the ... interpreting
    daily moving average charts and calculating the short interest percentage and ...

  • Dell Growing Profits Rapidly, Sales Barely

    http://stocks.investopedia.com/stock-analysis/2011/Dell-Growing-Profits-Rapidly-Sales-Barely-DELL-AAPL-GOOG-XRX-EK1123.aspx
    ... Interest expense reduced net income growth to 9%, as profits reached $893 million,
    but share buybacks boosted the per-share growth back to 17%, as earnings ...

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