402 Long term Strategy
I recently came across a new asset TAC which promises high returns by applying the compounding fundamentals.
It got me thinking. We already have a great asset that if we implement compounding, can be a BEAST. I am talking about 402.
Imagine the money that goes into dividends be instead re-invested. Instead of distributing 100% of the profit to the investors how awesome would it be for @nameless to re-invest it and make a fortune for us.
I have over a million shares, and I invested because I believe in this asset and its power. I also realize that we, the investors, enjoy getting dividends. So striking that sweet spot would be ideal.
Having said that, I am proposing that we reduce the dividend distribution by 50%. For example, If this asset made 2 BTC then the investors will get 50% of that fund i.e. 1 BTC worth of Burst. The other 1 BTC will be re-invested thus giving @nameless much more liquidity to make so much more money.
My opinion : we should keep the dividends as they are, because nameless already does what you are saying and not all profit is distributed to the investors (otherwise the asset would never grow). Also the dividends are not that high compared to some other assets on the market, reducing them by 50% would turn a lot of people away.
I think it's up to the investors to compound their dividends or not. However, I would expect every investor to be in it for the long run as it is a retirement fund, so yeah it's a very good strategy imo.
Also another reason more people should compound their 402 : it would reduce the huge sell wall every week.
IceBurst last edited by
I think you may be closer to the truth than you realize. 402 which trades in non-burst related activities as shown in a recent video is a victim of the price hike in terms of dividend payments with repsect to burst quantity.
What does this mean, lets do some math.
Prior to the price rise:
- Paid 180K burst a day
- Total Asset Market Cap: ~$140K
- Calculated payout per week ~1.5BTC
Post Price Rise (calculated)
- Market Cap is still ~$140K
- Should pay about 1.5BTC a week
- new reduced payout, ~50K Burst per day
What if we asked as the 402 holders to have our dividend structure modified? Here's my logic in the same vein.
- Please payout 50% of the growth (~25K burst daily)
- increase the folio holdings by 1/2% weekly.
- Please do this for 21 days (~1.5% folio gain)
Should the price of burst remain at the current price (540 sats) it should increase the daily payouts from 50K to 51K daily. Run 10 Days at the original formula to ensure our proof is correct (by looking at total folio holdings). Re-poll the investors if they want to do it again for another 2% portfolio growth. Ok, ok, 2% so what, well here's the Million burst question, are we at the bottom? If we go up to 550sat then payouts will be the same, but if we drop further, lets say to 520 then payouts go up to 53K daily (1K for the growth + 2K for the drop). It's interesting to not be tied to the currency your paid in.
Propagandalf last edited by
My opinion : we should keep the dividends as they are, because nameless already does what you are saying and not all profit is distributed to the investors (otherwise the asset would never grow).
I'm curious about the current reinvestment percentage. Compounded growth is a great concept when done right, and finding the sweet spot between high enough dividends and a satisfactory payout is in everyone's interest I can imagine, although I think @nameless pretty much has it under control.
@Propagandalf We'll have to wait for nameless for more precisions here :)
nameless last edited by
@Propagandalf ,current reinvestment percentage varies a lot. Anything i make over the dividend gets reinvested. Sometimes it's a few % , sometimes nothing because this is a trading assets and we had weeks when we took losses. The reinvesting also takes care of any potential losses for us, hence why i was always able to make the exact payout.
Imo maybe 50% to hold back would be too much. As @IceBurst pointed out, the average weekly was 1.5 BTC. If we were to go for a hold-back structure i'd say pay out 1 BTC at least and reinvest the rest.
At the end of the day, investors have the choice. That's the fun part of 402. They can cast a vote at any time for whatever the hell they want :) . As long as everyone agrees, we'll swing in that particular direction.
Propagandalf last edited by
Since 402 already has a good growth model, I'm already satisfied. But, I wouldn't mind a temporary reinvestment "boost", much like @IceBurst suggested.
nameless last edited by
Powah to the people!
I'm fine either way :)
Reducing payouts will make 402 grow faster. Staying as is means 402 will grow at the same rate
Btw, we're getting a third trader next week. I should remember to announce that stuff...
All the more reason to give you and your traders more liquidity to make money for us (the investors)...
Ip85 last edited by
Let's give 402 boost.I dont mind divident cut.
emcb last edited by
If the payment of dividends to the same extent as before will greatly affect the stability of asset, then I advocate the reduction of dividends. Otherwise, leave as is.
Same opinion as @emcb
potkas last edited by potkas
In my opinion what you could do nameless is to manage the payout of dividends as the asset needs! Lets call it dynamic dividends payout scheme. It could mean that you state dividends in between a wide range lets say current is 100% then between 0 or 10-190 or 200% and manage the payout ass you have good or a bad week making incomes! Lets say you paying 10% of the income so from now on you could wary between 0 or 1 to 19 or 20% depending how good your week and previous ones where . In a bad week you reduce in a good week you raise. Depending how much you make and what you feel is needed to make the asset successful. This way if you have a downturn in incomes you could pay less and when you feel your asset works great and incomes are raising you can pay premiums. Or instead paying premiums straight away first build a reserve. Reserve for bad times and raise only after reserve is large enough. This way you can do great dividends and if needed you can pull the handbrake to keep it stable. But it is just my meaningless opinion :) . By the way i believe in your skills and in your asset and im happy to be able to pick up some dirt cheap 402 . Keep on the good work mate!