Dec 13th 2011, 12:54 System Announcement
by Skip Oceanlane
Commentary - 5 "Greek" CapEx Stock FundsDear Capital Exchange Members:
I recently read a post on another website that told people they should sell their shares in some of the "Greek" Funds (as they have become known because their name has Greek letters in them) because they are "overvalued". The funds I'm referring to are the CapEx Beta, Delta, Gamma, Omega and Sigma Stock Funds (BSF, DSF, GSF, OSF and SSF). I think this is extremely bad advice, and the reasons the person gave make very little sense to me. Let me tell you why in my opinion.
These 5 stock funds are projected to pay between .015L - .020L dividend per share per quarter. Let's take a worst case projected scenario and say a fund is "only" going to pay a quarterly dividend of .015L. The price for each fund started at .25L per share, and are now around .20L per share, but let's use the "worst case scenario" price of .25L for the example.
Anyone that bought shares at .25L, and receives 4 quarterly dividends of .015L per share, will receive .06L per share per year (again to make it clear, these are projected returns). That means in a worst-case projected scenario right now, each person will make a 24% annual return on their investment for just doing nothing. Let me type that again - worst case projected scenario, people will make 24% back on their Lindens for having BSF, DSF, GSF, OSF and SSF stock. Honestly, that is a better return on investment than my CAPX stock (around 14% ROI annually projected).
In a best case scenario, the annual return could be as high as 50%. Let's say I'm wrong in my worst case scenario by half, and the return is "only" 12% a year. Try going to your local real life bank and getting a 12% return these days. It's not going to happen. Again to make it clear all these investments within the game are "risky", and do not promise any guaranteed return at all. But with the balanced portfolio each fund has, it's going to generate dividend revenue every month and should at least pay something.
I created these funds for the novice investor to buy inexpensive shares and earn a great return on their investment, and for daytraders to have a little fun buying and selling stock at very low prices in high quantities. For someone to recommend they sell any of these stocks isn't good advice at all,...in my humble opinion of course. Any questions, please feel free to ask. Thank you.
CEO and Majority Shareholder