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Generally accepted return on shares?
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Jacob Lyon Chieve
Sanguis Mortem Industrial
#1 - 2012-02-06 15:36:58 UTC
What is the generally accepted return on shares - typically speaking?

Say I invest: 10mil per * 20 shares = 200 mil
I am promised: 2 mil weekly * 20 shares = 40 mil per week
Shares pay themselves off in 5 weeks.

I'm inclined to say this is aggressive. I'm also inclined to avoid this scenario because it sounds scammy.

Or is my market newbie-ness causing me to not understand just how well a share can pay off?

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Darth Tickles
Doomheim
#2 - 2012-02-06 15:54:05 UTC
-100%
David Forge
GameOn Inc.
#3 - 2012-02-06 16:25:24 UTC
A longterm investment would usually have a smaller dividend. Ten percent would be more likely in a short term bond. One would need to know the details of a particular offering to hazard a guess at an appropriate rate but, as a general rule, as the offer becomes more attractive the likelihood that it's a scam increases (geometrically).
Jacob Lyon Chieve
Sanguis Mortem Industrial
#4 - 2012-02-06 16:28:28 UTC
Specifically: https://gate.eveonline.com/Corporation/Roden%20Laboratories

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David Forge
GameOn Inc.
#5 - 2012-02-06 17:31:17 UTC  |  Edited by: David Forge
That is awfully high. It is entirely possible that it's a legitimate offer (and if I'm not mistaken Roden has some history as a business) but the official Forge Ratings Agency & Pizzeria judgement is "Buyer Beware. Be Very, Very Ware".
Dane El
Negative Density
#6 - 2012-02-07 19:56:31 UTC
The corp has 20,001,00 shares. I would want to know how many are held by third parties and will be receiving dividends. Selling shares isn't common in Eve. Its typically better to take a loan or bond. Then you're not on the hook for dividends forever.
Magnu Stormhawk
#7 - 2012-02-08 09:19:56 UTC
Jacob Lyon Chieve wrote:
Specifically: https://gate.eveonline.com/Corporation/Roden%20Laboratories


This is either a scam or a failure waiting to happen. There is no business in EVE that can afford that cost of capital (80% per month). It makes no sense whatsoever. So you will either lose your money immediately, or lose it shortly after they realise they made a serious error of judgement.

It is not common for random corporations to sell shares. It is more common within the MD community but such (successful) ventures are always supported by proper business plans, and they rarely pay more than 10% ROI per month. The most long running ventures that paid out dividends to the public rarely paid out more than 5%.

Higher rates than this can generally be achieved on bonds and private loans that are uncollateralised, but very rarely do these rates exceed 15%. Shares are only a method of distributing dividends, they offer no security or guarantee whatsoever. They also offer a potential means of trading the instrument (although there is no secure way of doing so). Other than this, purchasing shares is the same as making a loan with no collateral.

Be wary.
El 1974
Green Visstick High
#8 - 2012-02-09 19:48:06 UTC
I own some shares in 0n3 World Industries, which actually paid something like that last month, but those kind of opportunities are quite rare. This sounds like a scam. There's 20,001,000 shares. @ 10 mln. each that would be 200 Trillion isk. I'm not buying these.
Mu-Shi Ai
Hosono House
#9 - 2012-02-10 13:42:15 UTC  |  Edited by: Mu-Shi Ai
I'd say that if we're talking about shares here and not a bond situation, you should make a percentage of the profit that is equal to the total percentage of shares you own. After all, in this situation, you're holding equity.

I have a single investor in my trading business right now, and he's making 18.7% of the monthly profit, as he actually holds equity in the corp.