 |
Further
Reading ...
|
|
How to Start a Nutrition Home Business - Randy Wilson
Most people discuss nutrition daily. How would you like to help people by starting a nutrition home business? It is an industry that is growing and changing constantly. Nutrition is big business and by starting a nutrition business now, you are...
Mark Twain and his Views on Smoking Cigarettes - Alina
It appears Mark Twain was a great lover of a good smoke. Having been a writer, and smoker, his entire life, he probably met folks that attempted to force the third precious thing down his throat on many occasions. You bet! The well-known author of...
Your Home Business: Turning Pennies into Dollars - Stone Evans
Henry Ford taught us that to simplify the manufacture of automobiles, that the best way to do so was to install the assembly line. That one change revolutionized the auto manufacturing industry permitting the industry to build cars at a cost...
Simple Strategies to Eliminate Debt on Your Own - Katie Spencer
The debt rates are climbing tremendously and not many people seem to be taking it seriously. If you are in debt, you are not alone but you might be standing in the wrong crowd if you haven’t gotten help with your debt yet. Many leave the problem...
|
|
|
Stock Support
|
 |
Written By:
William Cate
|
|
|
Your Stock Support Budget
By William Cate
Published February 2000
[http://home.earthlink.net/~beowulfinvestments/] [http://home.earthlink.net/~beowulfinvestments/globalvillageinvestmentclubwelcome/]
It costs money to create share buying. Every public company must find the
buyers for their shareholders' stock. You must have the buyer when your
shareholder sells. If your company fails to find the buyers, your share
price will collapse.
To maintain your present share price, your float will trade four times
annually. Your float is the stock held by your public shareholders. If your
company's float is one million shares, you must expect to find four million
shares of buying in the next year. If you keep your present shareholders,
you'll cut your stock support costs by 100%. If your insiders can't sell
and thus add to the company's float, you'll reduce your future stock
support costs by fourfold for every unsold insider share.
The annual supply and demand for your company's stock isn't constant in
the Market. You get a favorable write-up. Demand for your stock temporarily
jumps up. A major shareholder liquidates their position. The supply of your
stock temporarily increases in the Market. You need to level the
supply/demand curve. You can often do it by working with your shareholders. Your goal should be to maintain a sustainable share price. Your share price should trade within a narrow range.
There's a silver-lining about bad news. If your shareholders hear it from
you, you'll gain credibility. If they hear it from you, it won't sound as
bad as hearing it from their broker, a newspaper article, or in the
Shareholders' Annual Report. Budget money to spread bad news. It's a sound
long term strategy.
A Stock Support Rule of Thumb for OTCBB companies is that it costs a dime
to create a share of buying, when your share price is below one dollar. For
a share price above one dollar add five cents for every dollar of the share
price above one dollar. This means that it costs a quarter to - continued below ...
|
|
|
continued ...
support a
four-dollar share price. Multiply this share cost by your float and then by
four and you have an annual budget for stock support.
Stock support and compliance costs are the best arguments against going
public. You must convert these costs into a strong share price. You must
use your strong share price to buy profitable assets for your company. The
profitable assets must improve your bottomline. If you don't use your stock
as money to build your company, your long term shareholders will lose their
investment in your company. You'll fail.
If you believe that your share price reflects the merits of your company,
don't go public. Your share price will languish for years as you await some
Fundamentalist writer to discover the value in your company. Meanwhile the pragmatic CEO builds value by using their strong share price to buy
profitable assets. It can take twenty years to create a hundred million
dollar private company. It can take 20 months for a public company to buy
for stock a hundred million dollar public company. The option is your
company can earn the money, pay taxes, reinvest and grow. Or, you can go
public, print your own money called stock, and use your strong share price
to buy assets and become a hundred million dollar company. Your decision
involves your willingness to spend money to ensure a strong share price.
To contact the author: Visit the Beowulf Investments website: [http://home.earthlink.net/~beowulfinvestments/] Or, visit the Global Village Investment Club Website:
[http://home.earthlink.net/~beowulfinvestments/globalvillageinvestmentclubwelcome/]
About the Author
He has been the Managing Director of Beowulf Investments [http://home.earthlink.net/~beowulfinvestments/] since 1981 and is the Executive Director of the Global Village Investment Club [http://home.earthlink.net/~beowulfinvestments/globalvillageinvestmentclubwelcome/]
|
|
|
|
 |
|
|
| _Additional Resources ... |
|
Home Based Business: Your Ultimate Tax Shelter - J Stephen Pope
Starting and operating your own home based business is the ultimate tax shelter. Although this article has been written from a Canadian income tax perceptive, the principles should be practical in other tax jurisdictions. 1. Non-Deductible...
Scammers Use Better Business Bureau Name To Commit Scams - Dean Phillips
The Better Business Bureau recently issued a national alert to warn consumers and businesses about two questionable operations that are falsely using the BBB name to scam victims. One business is perpetrating an advance fee loan scam that...
Learn the money saving secrets of an accomplished Software Engineer. - Steve Garratt
* Have you ever forgotten a password, or a user name, or some other piece of important information? * Do you have a system for remembering your passwords but forgot the system? * Do you avoid registering for things because you can't cope with...
|
|
|
|
|
|
|
|
|
|
