Where:<\/p>\n\n\n\n
- \n
- Annual Profit<\/strong> = Interest Income – Corresponding Expenses<\/li>\n\n\n\n
- Asset at Risk<\/strong> = Asset Value X Unexpected Default Probability X Loss Given Default<\/li>\n<\/ul>\n\n\n\n
Suppose you buy two-year bonds worth 100,000 GEL, paying 10% per year, and your costs are 3% (brokerage, transaction fees, etc.).<\/p>\n\n\n\n
In this case, your real annual income would be 100,000 X (10%-3%) = 7,000 GEL.<\/p>\n\n\n\n
Next, suppose that once every 100 years, an unexpected recession occurs, causing 40% of the issuers of similar bonds to go bankrupt, and in case of bankruptcy, the asset value is completely lost.<\/p>\n\n\n\n
In this case, the value of the asset at risk would be = 100,000 X 40% X 100% = 40,000 GEL.<\/p>\n\n\n\n
Therefore, RORAC = 7,000 \/ 40,000 = 17.5%.<\/strong><\/p>\n\n\n\n
If the result is higher than your alternative costs (for example, if you bought and rented out liquid real estate), then the investment is acceptable and vice versa. Banks compare this data to their own ROE.<\/p>\n\n\n\n
The calculation seems overly theoretical but becomes practical when comparing two versions of a bond (or even an investment project). For example, we have a second bond that pays 8% instead of 10%, but it is partially secured by real estate and the loss in case of default is only 50%. In this case, RORAC = 25%.<\/strong><\/p>\n\n\n\n
![\"\"](\"https:\/\/i0.wp.com\/eoninvestment.com\/wp-content\/uploads\/2024\/05\/image-49.png?resize=434%2C313&ssl=1\")
<\/a><\/figure>\n\n\n\nP.S.<\/strong>
In my opinion, the main point is not necessarily to evaluate the unexpected risk based on 100-year statistics. You can easily assume the probability of default for any bond issuer, even if not 40%, but 3% or 5%, and use the formula to compare two different bonds. The key point here is to rationalize the decision.<\/p>\n\n\n\nSource of the idea:<\/strong><\/p>\n\n\n\n
Financial Markets and Institutions \u2013 By Anthony Saunders, Marcia Cornett and Otgo Erhemjamts<\/p>\n\n\n\n
However, in the book, RORAC is mistakenly called RAROC, which actually stands for a completely different ratio, so don’t get confused\u2026<\/p>\n\n\n\n
\n\n\n\n\u10d8\u10d7\u10d5\u10d0\u10da\u10d8\u10e1\u10ec\u10d8\u10dc\u10d4\u10d1\u10d7 \u10d7\u10e3 \u10d0\u10e0\u10d0 \u10d3\u10d4\u10e4\u10dd\u10da\u10e2\u10d8\u10e1 \u10e0\u10d8\u10e1\u10d9\u10e1, \u10e0\u10dd\u10ea\u10d0 \u10e5\u10d0\u10e0\u10d7\u10e3\u10da \u10d1\u10d0\u10d6\u10d0\u10e0\u10d6\u10d4 \u10dd\u10d1\u10da\u10d8\u10d2\u10d0\u10ea\u10d8\u10d4\u10d1\u10e1 \u10e7\u10d8\u10d3\u10e3\u10da\u10dd\u10d1\u10d7? \u10d7\u10e3 \u10d9\u10d8, – \u10d9\u10dd\u10dc\u10d9\u10e0\u10d4\u10e2\u10e3\u10da\u10d0\u10d3 \u10e0\u10dd\u10d2\u10dd\u10e0?
\u10d0\u10e0\u10e1\u10d4\u10d1\u10dd\u10d1\u10e1 \u10d4\u10e1\u10d4\u10d7\u10d8 \u10e1\u10d0\u10d8\u10dc\u10e2\u10d4\u10e0\u10d4\u10e1\u10dd \u10db\u10d0\u10e9\u10d5\u10d4\u10dc\u10d4\u10d1\u10d4\u10da\u10d8 – RORAC (Return on Risk Adjusted Capital), \u10e0\u10dd\u10db\u10d4\u10da\u10d8\u10ea \u10de\u10d8\u10e0\u10d5\u10d4\u10da\u10d0\u10d3 Bankers Trust-\u10db\u10d0 (\u10e8\u10d4\u10d8\u10eb\u10d8\u10dc\u10d0 Deutsche Bank-\u10db\u10d0 1998 \u10ec\u10d4\u10da\u10e1) \u10d2\u10d0\u10db\u10dd\u10d8\u10e7\u10d4\u10dc\u10d0 \u10d3\u10d0 \u10e8\u10d4\u10db\u10d3\u10d4\u10d2 \u10d7\u10d8\u10d7\u10e5\u10db\u10d8\u10e1 \u10e7\u10d5\u10d4\u10da\u10d0 \u10db\u10e1\u10ee\u10d5\u10d8\u10da\u10db\u10d0 \u10d0\u10db\u10d4\u10e0\u10d8\u10d9\u10e3\u10da\u10db\u10d0 \u10d3\u10d0 \u10d4\u10d5\u10e0\u10dd\u10de\u10e3\u10da\u10db\u10d0 \u10d1\u10d0\u10dc\u10d9\u10db\u10d0 \u10e9\u10d0\u10e3\u10e8\u10d5\u10d0 \u10e0\u10d8\u10e1\u10d9\u10d4\u10d1\u10d8\u10e1 \u10db\u10d0\u10e0\u10d7\u10d5\u10d8\u10e1 \u10e1\u10d8\u10e1\u10e2\u10d4\u10db\u10d0\u10e8\u10d8.
\u10e4\u10dd\u10e0\u10db\u10e3\u10da\u10d0 \u10d0\u10e6\u10ec\u10d4\u10e0\u10e1 \u10e3\u10d9\u10e3\u10d2\u10d4\u10d1\u10d0\u10e1 \u10d9\u10d0\u10de\u10d8\u10e2\u10d0\u10da\u10d8\u10e1 \u10d8\u10db \u10db\u10dd\u10ea\u10e3\u10da\u10dd\u10d1\u10d0\u10d6\u10d4 \u10e0\u10dd\u10db\u10d4\u10da\u10d8\u10ea \u201e\u10db\u10dd\u10e3\u10da\u10dd\u10d3\u10dc\u10d4\u10da\u10d8\u201c \u10e0\u10d8\u10e1\u10d9\u10d8\u10e1 \u10e5\u10d5\u10d4\u10e8 \u10d8\u10db\u10e7\u10dd\u10e4\u10d4\u10d1\u10d0. \u10d5\u10e4\u10d8\u10e5\u10e0\u10dd\u10d1, \u10d8\u10e1 \u10d2\u10d0\u10db\u10dd\u10e7\u10d4\u10dc\u10d4\u10d1\u10d0\u10d3\u10d8\u10d0 \u10dd\u10d1\u10da\u10d8\u10d2\u10d0\u10ea\u10d8\u10d8\u10e1 \u10e7\u10d8\u10d3\u10d5\u10d8\u10e1 \u10d2\u10d0\u10d3\u10d0\u10ec\u10e7\u10d5\u10d4\u10e2\u10d8\u10da\u10d4\u10d1\u10d8\u10e1 \u10db\u10d8\u10e6\u10d4\u10d1\u10d8\u10e1\u10d0\u10e1.
RORAC = \u10ec\u10da\u10d8\u10e3\u10e0\u10d8 \u10db\u10dd\u10d2\u10d4\u10d1\u10d0\/\u10d0\u10e5\u10e2\u10d8\u10d5\u10d8 \u10e0\u10d8\u10e1\u10d9\u10d8\u10e1 \u10e5\u10d5\u10d4\u10e8
\u10e1\u10d0\u10d3\u10d0\u10ea,
\u10ec\u10da\u10d8\u10e3\u10e0\u10d8 \u10db\u10dd\u10d2\u10d4\u10d1\u10d0 = \u10e1\u10d0\u10de\u10e0\u10dd\u10ea\u10d4\u10dc\u10e2\u10dd \u10e8\u10d4\u10db\u10dd\u10e1\u10d0\u10d5\u10da\u10d4\u10d1\u10e1 – \u10e8\u10d4\u10e1\u10d0\u10d1\u10d0\u10db\u10d8\u10e1\u10d8 \u10ee\u10d0\u10e0\u10ef\u10d4\u10d1\u10d8
\u10d0\u10e5\u10e2\u10d8\u10d5\u10d8 \u10e0\u10d8\u10e1\u10d9\u10d8\u10e1 \u10e5\u10d5\u10d4\u10e8 = \u10d0\u10e5\u10e2\u10d8\u10d5\u10d8\u10e1 \u10e6\u10d8\u10e0\u10d4\u10d1\u10e3\u10da\u10d4\u10d1\u10d0 X \u10db\u10dd\u10e3\u10da\u10dd\u10d3\u10dc\u10d4\u10da\u10d8
\u10d3\u10d4\u10e4\u10dd\u10da\u10e2\u10d8\u10e1 \u10d0\u10da\u10d1\u10d0\u10d7\u10dd\u10d1\u10d0 X \u10d3\u10d0\u10dc\u10d0\u10d9\u10d0\u10e0\u10d2\u10d8 \u10d3\u10d4\u10e4\u10dd\u10da\u10e2\u10d8\u10e1 \u10e8\u10d4\u10db\u10d7\u10ee\u10d5\u10d4\u10d5\u10d0\u10e8\u10d8
\u10d3\u10d0\u10d5\u10e3\u10e8\u10d5\u10d0\u10d7, \u10d8\u10e7\u10d8\u10d3\u10d4\u10d7 100 000 \u10da\u10d0\u10e0\u10d8\u10e1 \u10dd\u10e0 \u10ec\u10da\u10d8\u10d0\u10dc\u10d8 \u10dd\u10d1\u10da\u10d8\u10d2\u10d0\u10ea\u10d8\u10d4\u10d1\u10d8, \u10e0\u10dd\u10db\u10d4\u10da\u10d8\u10ea \u10ec\u10d4\u10da\u10d8\u10ec\u10d0\u10d3\u10e8\u10d8 \u10d2\u10d8\u10ee\u10d3\u10d8\u10d7 10%-\u10e1, \u10ee\u10dd\u10da\u10dd \u10d7\u10e5\u10d5\u10d4\u10dc\u10d8 \u10ee\u10d0\u10e0\u10ef\u10d8 \u10d0\u10e0\u10d8\u10e1 3% (\u10e1\u10d0\u10d1\u10e0\u10dd\u10d9\u10d4\u10e0\u10dd, \u10e2\u10e0\u10d0\u10dc\u10d6\u10d0\u10e5\u10ea\u10d8\u10d8\u10e1 \u10e1\u10d0\u10d9\u10dd\u10db\u10d8\u10e1\u10d8\u10dd \u10d7\u10e3 \u10e1\u10ee\u10d5\u10d0…)
\u10d0\u10e1\u10d4\u10d7 \u10e8\u10d4\u10db\u10d7\u10ee\u10d5\u10d4\u10d5\u10d0\u10e8\u10d8, \u10d7\u10e5\u10d5\u10d4\u10dc\u10d8 \u10e0\u10d4\u10d0\u10da\u10e3\u10e0\u10d8 \u10ec\u10da\u10d8\u10e3\u10e0\u10d8 \u10e8\u10d4\u10db\u10dd\u10e1\u10d0\u10d5\u10d0\u10da\u10d8 \u10d8\u10e5\u10dc\u10d4\u10d1\u10d0 100 000 X (10%-3%) = 7000 \u10da\u10d0\u10e0\u10d8.
\u10e8\u10d4\u10db\u10d3\u10d4\u10d2, \u10d3\u10d0\u10d5\u10e3\u10e8\u10d5\u10d0\u10d7, \u10e0\u10dd\u10db 100 \u10ec\u10d4\u10da\u10d8\u10ec\u10d0\u10d3\u10e8\u10d8 \u10d4\u10e0\u10d7\u10ee\u10d4\u10da, \u10ee\u10d3\u10d4\u10d1\u10d0 \u10db\u10dd\u10e3\u10da\u10dd\u10d3\u10dc\u10d4\u10da\u10d8 \u10e0\u10d4\u10ea\u10d4\u10e1\u10d8\u10d0, \u10d8\u10e1\u10d4\u10d7\u10d8 \u10e0\u10dd\u10db\u10d4\u10da\u10d8\u10ea \u10d8\u10ec\u10d5\u10d4\u10d5\u10e1 \u10db\u10e1\u10d2\u10d0\u10d5\u10e1\u10d8 \u10dd\u10d1\u10da\u10d8\u10d2\u10d0\u10ea\u10d8\u10d4\u10d1\u10d8\u10e1 \u10d2\u10d0\u10db\u10dd\u10db\u10e8\u10d5\u10d4\u10d1\u10d8 \u10dd\u10e0\u10d2\u10d0\u10dc\u10d8\u10d6\u10d0\u10ea\u10d8\u10d4\u10d1\u10d8\u10e1 40%-\u10d8\u10e1 \u10d1\u10d0\u10dc\u10d9\u10e0\u10dd\u10e2\u10e1, \u10ee\u10dd\u10da\u10dd \u10d1\u10d0\u10dc\u10d9\u10e0\u10dd\u10e2\u10d8\u10e1 \u10e8\u10d4\u10db\u10d7\u10ee\u10d5\u10d4\u10d5\u10d0\u10e8\u10d8 \u10d8\u10d9\u10d0\u10e0\u10d2\u10d4\u10d1\u10d0 \u10d0\u10e5\u10e2\u10d8\u10d5\u10d8\u10e1 \u10e6\u10d8\u10e0\u10d4\u10d1\u10e3\u10da\u10d4\u10d1\u10d8\u10e1 100%.
\u10d0\u10e1\u10d4\u10d7 \u10e8\u10d4\u10db\u10d7\u10ee\u10d5\u10d4\u10d5\u10d0\u10e8\u10d8, \u10e0\u10d8\u10e1\u10d9\u10d8\u10e1 \u10e5\u10d5\u10d4\u10e8 \u10db\u10e7\u10dd\u10e4\u10d8 \u10d0\u10e5\u10e2\u10d8\u10d5\u10d8\u10e1 \u10e6\u10d8\u10e0\u10d4\u10d1\u10e3\u10da\u10d4\u10d1\u10d0 \u10d8\u10e5\u10dc\u10d4\u10d1\u10d0 = 100 000 X 40% X 100% = 40 000 \u10da\u10d0\u10e0\u10d8.
\u10e8\u10d4\u10e1\u10d0\u10d1\u10d0\u10db\u10d8\u10e1\u10d0\u10d3, – RORAC = 7000\/40000 = 17.5%.
\u10d7\u10e3 \u10db\u10d8\u10e6\u10d4\u10d1\u10e3\u10da\u10d8 \u10e8\u10d4\u10d3\u10d4\u10d2\u10d8 \u10db\u10d0\u10e6\u10d0\u10da\u10d8\u10d0 \u10d7\u10e5\u10d5\u10d4\u10dc\u10e1 \u10d0\u10da\u10e2\u10d4\u10e0\u10dc\u10d0\u10e2\u10d8\u10e3\u10da \u10ee\u10d0\u10e0\u10ef\u10d4\u10d1\u10d6\u10d4 (\u10db\u10d0\u10d2\u10d0\u10da\u10d8\u10d7\u10d0\u10d3 \u10e0\u10dd\u10db \u10d2\u10d4\u10e7\u10d8\u10d3\u10d0\u10d7 \u10d3\u10d0 \u10d2\u10d0\u10d2\u10d4\u10e5\u10d8\u10e0\u10d0\u10d5\u10d4\u10d1\u10d8\u10dc\u10d0\u10d7 \u10da\u10d8\u10d9\u10d5\u10d8\u10d3\u10e3\u10e0\u10d8 \u10e3\u10eb\u10e0\u10d0\u10d5\u10d8 \u10e5\u10dd\u10dc\u10d4\u10d1\u10d0) – \u10db\u10d0\u10e8\u10d8\u10dc \u10d8\u10dc\u10d5\u10d4\u10e1\u10e2\u10d8\u10ea\u10d8\u10d0 \u10db\u10d8\u10e1\u10d0\u10e6\u10d4\u10d1\u10d8\u10d0 \u10d3\u10d0 \u10de\u10d8\u10e0\u10d8\u10e5\u10d8\u10d7. \u10d1\u10d0\u10dc\u10d9\u10d4\u10d1\u10d8 \u10d0\u10db \u10db\u10dd\u10dc\u10d0\u10ea\u10d4\u10db\u10e1 \u10d0\u10d3\u10d0\u10e0\u10d4\u10d1\u10d4\u10dc \u10e1\u10d0\u10d9\u10e3\u10d7\u10d0\u10e0 ROE-\u10e1.
\u10d6\u10d4\u10d3\u10db\u10d4\u10e2\u10d0\u10d3 \u10d7\u10d4\u10dd\u10e0\u10d8\u10e3\u10da\u10d8 \u10e9\u10d0\u10dc\u10e1 \u10d9\u10d0\u10da\u10d9\u10e3\u10da\u10d0\u10ea\u10d8\u10d0, \u10db\u10d0\u10d2\u10e0\u10d0\u10db \u10de\u10e0\u10d0\u10e5\u10e2\u10d8\u10d9\u10e3\u10da\u10d8 \u10ee\u10d3\u10d4\u10d1\u10d0, \u10e0\u10dd\u10ea\u10d0 \u10dd\u10d1\u10da\u10d8\u10d2\u10d0\u10ea\u10d8\u10d8\u10e1 (\u10d0\u10dc \u10d7\u10e3\u10dc\u10d3\u10d0\u10ea \u10e1\u10d0\u10d8\u10dc\u10d5\u10d4\u10e1\u10e2\u10d8\u10ea\u10d8\u10dd \u10de\u10e0\u10dd\u10d4\u10e5\u10e2\u10d8\u10e1) \u10dd\u10e0 \u10d5\u10d4\u10e0\u10e1\u10d8\u10d0\u10e1 \u10d0\u10d3\u10d0\u10e0\u10d4\u10d1 \u10d4\u10e0\u10d7\u10db\u10d0\u10dc\u10d4\u10d7\u10e1. \u10db\u10d0\u10d2\u10d0\u10da\u10d8\u10d7\u10d0\u10d3, \u10d2\u10d5\u10d0\u10e5\u10d5\u10e1 \u10db\u10d4\u10dd\u10e0\u10d4 \u10dd\u10d1\u10da\u10d8\u10d2\u10d0\u10ea\u10d8\u10d0 \u10e0\u10dd\u10db\u10d4\u10da\u10d8\u10ea 10%-\u10d8\u10e1 \u10dc\u10d0\u10ea\u10d5\u10da\u10d0\u10d3 \u10d8\u10ee\u10d3\u10d8\u10e1 8%-\u10e1, \u10d7\u10e3\u10db\u10ea\u10d0 \u10dc\u10d0\u10ec\u10d8\u10da\u10dd\u10d1\u10e0\u10d8\u10d5 \u10e3\u10d6\u10e0\u10e3\u10dc\u10d5\u10d4\u10da\u10e7\u10dd\u10e4\u10d8\u10da\u10d8\u10d0 \u10e3\u10eb\u10e0\u10d0\u10d5\u10d8 \u10e5\u10dd\u10dc\u10d4\u10d1\u10d8\u10d7 \u10d3\u10d0 \u10d3\u10d4\u10e4\u10dd\u10da\u10e2\u10d8\u10e1 \u10e8\u10d4\u10db\u10d7\u10ee\u10d5\u10d4\u10d5\u10d0\u10e8\u10d8 \u10d3\u10d0\u10dc\u10d0\u10d9\u10d0\u10e0\u10d2\u10d8 \u10db\u10ee\u10dd\u10da\u10dd\u10d3 50%-\u10d8 \u10d8\u10e5\u10dc\u10d4\u10d1\u10d0. \u10d0\u10e1\u10d4\u10d7 \u10e8\u10d4\u10db\u10d7\u10ee\u10d5\u10d4\u10d5\u10d0\u10e8\u10d8 RORAC = 25%-\u10e1…<\/p>\n\n\n\n![\"\"](\"https:\/\/i0.wp.com\/eoninvestment.com\/wp-content\/uploads\/2024\/05\/image-50.png?resize=434%2C313&ssl=1\")
<\/a><\/figure>\n\n\n\n\u10de.\u10e1.
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\u10d8\u10d3\u10d4\u10d8\u10e1 \u10ec\u10e7\u10d0\u10e0\u10dd:
Financial Markets and Institutions \u2013 By Anthony Saunders, Marcia Cornett and Otgo Erhemjamts<\/p>\n","protected":false},"excerpt":{"rendered":"Do You Consider Default Risk When Purchasing Bonds on the Georgian Market? If So, How Specifically? There is an interesting metric called RORAC (Return on Risk Adjusted Capital), which was first used by Bankers Trust (acquired by Deutsche Bank in 1998) and later incorporated into the risk management systems of almost all major American and […]<\/p>\n","protected":false},"author":12998525,"featured_media":1058,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_coblocks_attr":"","_coblocks_dimensions":"","_coblocks_responsive_height":"","_coblocks_accordion_ie_support":"","_crdt_document":"","advanced_seo_description":"","jetpack_seo_html_title":"","jetpack_seo_noindex":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2},"jetpack_post_was_ever_published":false},"categories":[774675918,37048,37372],"tags":[1523069,4269,6635,784445427],"class_list":{"0":"post-1881","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","6":"hentry","7":"category-financial-markets-and-institutions-by-a-saunders-m-cornett-o-erhemjamts","8":"category-interest-rates","9":"category-risk","10":"tag-default-risk","11":"tag-finance","12":"tag-investing","13":"tag-risk","15":"fallback-thumbnail"},"jetpack_publicize_connections":[],"jetpack_featured_media_url":"https:\/\/i0.wp.com\/eoninvestment.com\/wp-content\/uploads\/2024\/04\/ma3.jpeg?fit=2048%2C1152&ssl=1","jetpack_likes_enabled":true,"jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/pQZ85-ul","_links":{"self":[{"href":"https:\/\/eoninvestment.com\/ka\/wp-json\/wp\/v2\/posts\/1881","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/eoninvestment.com\/ka\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/eoninvestment.com\/ka\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/eoninvestment.com\/ka\/wp-json\/wp\/v2\/users\/12998525"}],"replies":[{"embeddable":true,"href":"https:\/\/eoninvestment.com\/ka\/wp-json\/wp\/v2\/comments?post=1881"}],"version-history":[{"count":12,"href":"https:\/\/eoninvestment.com\/ka\/wp-json\/wp\/v2\/posts\/1881\/revisions"}],"predecessor-version":[{"id":5855,"href":"https:\/\/eoninvestment.com\/ka\/wp-json\/wp\/v2\/posts\/1881\/revisions\/5855"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/eoninvestment.com\/ka\/wp-json\/wp\/v2\/media\/1058"}],"wp:attachment":[{"href":"https:\/\/eoninvestment.com\/ka\/wp-json\/wp\/v2\/media?parent=1881"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/eoninvestment.com\/ka\/wp-json\/wp\/v2\/categories?post=1881"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/eoninvestment.com\/ka\/wp-json\/wp\/v2\/tags?post=1881"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
- Asset at Risk<\/strong> = Asset Value X Unexpected Default Probability X Loss Given Default<\/li>\n<\/ul>\n\n\n\n
![\"\"](\"https:\/\/i0.wp.com\/eoninvestment.com\/wp-content\/uploads\/2024\/05\/image-49.png?ssl=1\")
<\/a><\/figure>\n\n\n\n