INVESTMENT :
INVESTMENT Investment is the most powerful and effective way to increase one’s financial portfolio. From time to time, individuals and corporations invest, re-invest and diversify their investment into portfolios that are in line with their investment objectives. As a corporation we employ a similar strategy and as shareholders you should do the same.
Berkshire Hathaway - Warren Buffet :
Berkshire Hathaway - Warren Buffet Berkshire Hathaway (BRK-A in NYSE) is a conglomerate holding company controlled by Warren Buffet since the 60s and has always re-invested all of its profit back into the business. All dividends have been reinvested back into the business and within 40 years, its share value has increased by 10,000 folds. A USD 1,000 compounded re-investment for over 40 years translates into USD 10,00, 000 in today’s money.
Convertible Preference shares (CPS):
Convertible Prefer ence shares (CPS ) East Cape Mining Corporation Convertible Preference Shares (CPS) is being offered at USD0.75 per share today (relatively undervalued). With the gold price at USD45 – USD52 per gram, re-investment of CPS will compound your wealth to slightly more than three (3) times your initial investment within 1 year, a whopping eighteen (18) times your initial investment within 2 years on the most basic assumption.
Illustration :
Illustration The table below has been designed based on the assumption that you re-invest your entire dividend into subscribing more CPS the following month and continue doing so every month to create a compounded effect. Assumption 1: one share of CPS is equivalent to USD0.75. Assumption 2: 1 gram of gold is equivalent to USD50. Assumption 3: Subscribing 4,000 CPS which is equivalent to USD3,000.
Slide 6:
Month Accumulative CPS Dividend per Month (USD) Monthly CPS Re-investment % Initial 4,000 400 500 0 1 4,500 450 500 12 2 5,000 500 500 25 3 5,500 550 500 37 4 6,000 600 1,000 50 5 7,000 700 1,000 75 6 8,000 800 1,000 100 7 9,000 900 1,500 125 8 10,500 1,050 1,500 162 9 12,000 1,200 1,500 200 10 13,500 1,350 1,500 237 11 15,000 1,500 2,000 275 12 17,000 1,700 2,500 325 13 19,500 1,950 2,500 387 14 22,000 2,200 3,000 450 15 25,000 2,500 3,500 525 16 28,500 2,850 3,500 612 17 32,000 3,200 4,500 700 18 36,500 3,650 4,500 812 19 41,000 4,100 5,500 925 20 46,500 4,650 6,500 1062 21 53,000 5,300 7,000 1225 22 60,000 6,000 8,000 1400 23 68,000 6,800 9,000 1600 24 77,000 7,700 - 1825
Slide 7:
An initial investment of 4,000 CPS will be compounded to almost 17,000 CPS in 1 year and 77,000 CPS in 2 years. What if the spot gold price increases beyond USD50? Your compounded re-investment effect would be much greater than what was illustrated.