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New Stamp Investment Idea At San

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Posted 12/11/2019   10:23 pm  Show Profile Bookmark this reply Add bookbndrbob to your friends list  Get a Link to this Reply
1..2..3. There. I have spent as much time on this "investment" idea as I do with the telephone "cold callers".
.
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Edited by bookbndrbob - 12/11/2019 10:23 pm
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Posted 12/11/2019   11:50 pm  Show Profile Bookmark this reply Add cjpalermo1964 to your friends list  Get a Link to this Reply

Quote:
The problem with these investments is the 20% in juice you pay on the purchase and the 10% you pay to sell .....it is hard to see a profit when the broker makes that much .

The Droege white paper proposes that "investors" address this by discounting their top bid to account for those costs. Which would require extreme discipline in the bidding process.

Quote:
And the tax man wants a cut......unless you deduct the loss.

These investments are unregulated and investor-sellers are extremely unlikely to report capital gains or pay tax. Do people report and pay capital gains on the sales of classic cars after long-term holds? The transactions are entirely outside the tax system. Of course, if the Droege business grew like gangbusters, he would run the risk of an IRS subpoena looking for records of investors who both bought and sold via SAN over a span of years, and didn't pay tax. Droege would unwittingly serve as the basis of enforcement actions. I doubt he's anticipated that ...
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Posted 12/12/2019   08:45 am  Show Profile Bookmark this reply Add ikeyPikey to your friends list  Get a Link to this Reply

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... The problem with these investments is the 20% in juice you pay on the purchase and the 10% you pay to sell ...


And that 20% plus 10% means that you need a 33% 'return' just to return your original investment.

<math> You pay U$D 100 net, eg, including any buyer's premium, shipping, sales tax, etc. What does the next guy have to pay? U$D 133, which is a 20% buyer's premium on top of a U$D 111 sale price that nets you U$D 100.</math>

Later in the document, Mr Droege explains (more than once) (pages 7 and 17) that auction houses will not only discount their commissions for "investment grade" stamps, they will sometimes pay negative commissions for the commercial advantage of hosting this material.

I have no basis on which to evaluate that claim.

Cheers,

/s/ ikeyPikey
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Edited by ikeyPikey - 12/12/2019 09:03 am
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Posted 12/12/2019   09:28 am  Show Profile Bookmark this reply Add rogdcam to your friends list  Get a Link to this Reply
I can affirm that at least one house will discount their commission to 10% for the seller. That does nothing for the buyer.
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Posted 12/12/2019   09:43 am  Show Profile Bookmark this reply Add sheetguy2 to your friends list  Get a Link to this Reply

Quote:
Later in the document, Mr Droege explains (more than once) (pages 7 and 17) that auction houses will not only discount their commissions for "investment grade" stamps, they will sometimes pay negative commissions for the commercial advantage of hosting this material.


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Posted 12/12/2019   10:46 am  Show Profile Check revenuecollector's eBay Listings Bookmark this reply Add revenuecollector to your friends list  Get a Link to this Reply
Meh. It's an advisory service targeted at 1%ers... meaningless to me.

That said, it's a completely different offering from Stanley Gibbons "inevestment portfolio".

I suppose if I were a multi-millionaire that wanted to dabble in stamps, the $1,000-2,500 per year for this service would be a nominal expenditure.

*shrug*
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Posted 12/12/2019   2:34 pm  Show Profile Bookmark this reply Add cjpalermo1964 to your friends list  Get a Link to this Reply
A shrug and dismissal from some is fine, but there are at least several members of this community who have invested $50K to $100K in high-quality stamps in the past 5-10 years, and for them, the Droege white paper is worth reading.
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Posted 12/12/2019   5:08 pm  Show Profile Bookmark this reply Add ikeyPikey to your friends list  Get a Link to this Reply

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... invested $50K to $100K in high-quality stamps in the past 5-10 years ...


... and if you are looking at that range of investment - and targeting that high a rate of return - then U$D 1000 or U$D 2500 per annum is the sort of money people pay for well-qualified advice.

Cheers,

/s/ ikeyPikey
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Posted 12/12/2019   11:33 pm  Show Profile Check eyeonwall's eBay Listings Bookmark this reply Add eyeonwall to your friends list  Get a Link to this Reply
auction houses will adjust their commissions based on both the desirability of the material and on whether the seller is a one time seller or a repeat seller (or a first time seller with other good material that will become available in the future).
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Posted 12/21/2019   9:34 pm  Show Profile Bookmark this reply Add floortrader to your friends list  Get a Link to this Reply
The problem here that nobody wants to say is "Your getting advice from someone who has no track record and as far as I know doesn't invest himself " He build a pricing model over the last few years and selling computer spread sheet model as advice .
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Posted 12/21/2019   11:00 pm  Show Profile Bookmark this reply Add ikeyPikey to your friends list  Get a Link to this Reply

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[Page 6]... The value will be independent of other market forces, the stock market, interest rates, housing prices, currency exchange rates and elections ...


I am reluctant to trust a model that predicts that any asset class with no income stream (no interest, no dividends, no rent, just bubbles) is immune from interest rates.

Today, a U$D 100,000 FDIC-protected CD would give you U$D ~200 every month, month after month.

Not much, to be sure, but at least you don't have to pay the bank a U$D 10,000 commission for the privilege of cashing it in.

Let real interest rates rise a bit, and watch what happens to all of the assets that offer risk, fee-laden liquidity, and no income stream.

Cheers,

/s/ ikeyPikey
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