Investment & Investing

I think investing in companies who products/services you use makes good sense.
Like investing in a house and living it.

Essentially means you get the product at cost, because any profit the company makes comes back to you. Obviously this benefit depends on your level of orignal investment.

Yes. For that to be true you have to buy the whole company.

This was brought about 4 -5 years ago by a couple of investors from the guy who originally started it up . Their plan was always to create a national real ale brand and then sell on

They appear to have succeded.

There is some doubt as to how long the Brewery will remain in Rock.

See the last edition of "What's Brewing " the Camra magazine for the full story.

Yes. For that to be true you have to buy the whole company.

explain?

explain?

Well if you own say 10% of a company, then you are entitled to 10% of the profits.

Say you buy a Guinness in the Guinness Factory bar in Dublin.
Perhaps cost of 50p for a £5 pint (just making up numbers).
So Diageo makes £4.50p (gross) profit out of you.

You only have the right to 10% of that profit so 45p. The other holders of the company (who hold 90%) have the right to the other £4.05.

So your Guinness cost you £5 less the profits you own, 45p. Your Guinness net cost was £4.55p.

Obviously if you owned the whole company the cost would only be 50p since you have the right to ALL the profits. Your cost would be £5 less the £4.50p so 50p. i.e. cost price.

But when you buy Stella you loose twice.

corporation tax, cost of distribution, marketing, and duty on the booze.

Yes. For that to be true you have to buy the whole company.

Well if you own say 10% of a company, then you are entitled to 10% of the profits.

So you now see, you don't need to own the whole company to benefit from the profit in the sale of its goods.

fixed.

corporation tax, cost of distribution, marketing, and duty on the booze.

micro brewery is all under one roof / on the premises.. i accept that tax will be a burden, getting a license and operating within the law a technicality.. but you don't sell to a distributor and you market everything for yourselves..

what you need is a partner with a good track record, landlord status getting a premises license is the biggest hurdle. invest in your own equipment and buy the ingredients to make beer, fark you could start it at home if you really wanted to have a go.

So you now see, you don't need to own the whole company to benefit from the profit in the sale of its goods.

fixed.

You said "at cost". I was just pointing out that as a tiny shareholder you are really paying full price with a miniscule amount of the profit coming back to you.

And as Mr Smyth points out of course you still have to pay the duty and tax which only ever benefits the government.

I guess if you really wanted to get a beer at cost you would need to buy a brewery and then grab a pint glass and fill it from the fermenting tank direct...
(Mr Smyth would probably point out this should then be considered a benefit in kind so you would get taxed on it somehow...)

Obviously this benefit depends on your level of orignal investment.

I thought you might have been suggesting unless you own a controlling stake you can't decide where profits are paidout in the form of dividends or reinvested in the company

but regardless profit is profit, 10% or 100%

Nice safe low risk stocks and share isa from a high st bank then. They will stick your money in safe shares (like themselves, government bonds etc) and you can always get your money out. You are unlikely to lose anything but you need to be willing to leave it for 5+ years to see any profit. Or you could go medium risk, double the risk factor but also the gain factor...

BTW i am absolutley no expert! Have just been doing my research since my first investment in January.

OmarLittle, what websites/services do you use to do research and make transactions? Thanks

Don't ask me. I'm doing nothing but lose money.....stuck some money in 2 companies that where going up up up for days and literally as soon as I put my money in they went down! I was trying to make a quick buck which is where it goes wrong. It's all about leaving it for at least a few months if not years, otherwise is day trading and that's risky.

There are a few sites like proactive investors and stockopedia that have good articles and forums. You need to do your research though even when you get given a tip as everyone has a different opinion on things. Stocks and shares ISA is a good idea but only if you are willing to forget and not need the money for 3-5 years to get the benefit.

But honestly don't listen to me, I am not a very good example of a city boy!

This was brought about 4 -5 years ago by a couple of investors from the guy who originally started it up . Their plan was always to create a national real ale brand and then sell on

They appear to have succeded.

There is some doubt as to how long the Brewery will remain in Rock.

See the last edition of "What's Brewing " the Camra magazine for the full story.

Yes I read that hence my hesitance in the molson coors brand.. the whole lot could be moved to burton and ruined, then I'd hate my shares

I have just invested in 4 carbon credits/sequestrations.

The carbon will be captured in China and shipped to the UK where I can keep an eye on it.

lol, if I had all this money I would blow it straight away on something very powerful and very fast, then ride my bike into it, and call myself a cnut, lol

ftfy

Cheers Omar. Was just interested in how you make transaction. Presumably the layman does not simply walk into the LSE, ripping bits off spewing ticker-tape machines, announcing he's going long on frozen concentrated orange juice futures.

Maybe I'll stick to ISAs and premium bonds...

I have just invested in 4 carbon credits/sequestrations.

The carbon will be captured in China and shipped to the UK where I can keep an eye on it.

Lol.

It's all looking rather iffy in the Western economies at the moment. S&P gone negative for the year, Italy and Spain buggered, even French borrowing spreads re Germany at Euro era highs.

But Gold is still going up. No bubble there.

I think it's all very interesting at the moment. The US empire is going to fall. In Europe we are made to cut out costs because we can only borrow so much. Not in America they can change the law and lift debt levels.

As I said very interesting.

Lot of chat about the US debt deal being weak as fuck: cuts too small / ceiling raise too small for stimulus, and US macro is pointing towards a double dip. Also, China macro appears to be weak and Spanish / Italian yeilds are at a simlilar level to Ireland before its bailout. Pretty grim.

If i had money I would be in Gold right now - Central fund of Canada springs to mind. Oh, and Monorail is always a safe bet.

Considering that CEF lists that over 95% of their investments are tied up in gold and silver why doesn't their share price rice in line with the gold and silver prices?

They've gone up 3.5% today, probably on the back of your analysis :)

Close to the bottom in the UK, I imagine. Will probably see a lot of toe-dipping over the next week.

I'd be inclined to come out of Gold now and into Oil and resources.

That said, it's better to be late on the way up, than go balls-deep at the first sign of recovery.

FTSE sub 5000, got to be a buy for the medium term.