:il.

IX  y  U  '

tion  in  income  is  reparable,  whilst  to  attempt
to  maintain  the  original  standard  of  income
with  a  reduced  capital  sum  is  a  difficult  and
frequently  a  hazardous  proceeding.
In  recent  years  it  has  been  quite  easy  to
construct  a  very  safe  investment  list  to  yield
4^  per  cent,  per  annum  on  an  average,  but  it  has
never  been  easy  very  greatly  to  increase  this
yield  with  due  regard  to  capital  safety.  Now,
suppose  £10,000  had  been  invested  to  produce
£450  per  annum,  and  this  income  had  dropped
20  per  cent,  to  £360,  but  the  capital  value  had
remained  intact.  In  the  following  example,
taken  from  actual  experience,  this  condition  of
affairs  is  very  nearly  approximated,  thus  :—
Bought  in  1892.

£2,000  Barry  Railway  Ordinary
at  203.  Div.  9^  per  cent.
£2,500  Queensland  4  per  cent.  Stock
at  10*3  ...  ...  ...  ...
60  shares  Union  Bank  of  Australia
at  £57  a  share.  Div.  £3  a  share

Price.
£4,060
2,595
3,420

Annual
Income.

£190

92

180

£10,075  ...  £462

Value  in  1897.

£2,000  Barry  Railway  Ordinary
at  291.  Div.  10  per  cent.
£2,500  Queensland  4  per  cent  Stock.
at  113  ...  ...  ...
60  shares  Union  Bank  of  Australia
at  £29  a  share.  Div.  £l£  per  share  1,740

Price.
£5,820
2,825

Annual
Income

...  £200
...  92
...  75

£10,385  ...  £367