- Joined
- Jun 30, 2004
- Messages
- 114
- Reaction score
- 0
Talk to a trusted financial advisor about this (who manages your investments?). It's true you could sell the portfolio for $200k and reinvest the money. However, if this traffic is solid type in or some other sustainable type, that's $96,000 per year in essentially risk free earnings from the domains. The markets go up and down. Let's say that the domains are not risk free. They are certainly not as risky as equities. We'll compare them to corporate bonds, investment grade.
A. Sell portfolio for $200k, invest in lowest investment grade corporate bonds, they pay at most 8% (two coupons, one every six months). earn $16k per year in investment interest. We'll pretend you can reinvest the earnings, but since payment is only once every six months, you can only compound semi-annually. Additionally there is no guarantee that when you compound you will receive 8%. Also you might be stuck with the bond until maturity should interest rates rise (and they will rise).
B. Keep portfolio. Earn $96,000 per year.
Portfolio value will remain the same or increase as pool of traffic names available at drop decreases and competition increases (as it has the past five years). People will pay more and more years revenue for portfolios as the pool of available domains for purchase decreases and the number of buyers increases. Simple economics. You can invest your income stream as well.
Hell, with $96,000 per year, you are earning the money monthly. You can invest that money each month. You can lose it all and you will have it all back in 12 months.
What work are you doing for these domains?
You definitely made the right decision.
Stock market depression bla bla bla, just invest your income stream if you want. Don't sell the cash printing press.
$200,000 is a pittance and you would be a fool to accept it. $96k per year, that domain pool has a value of at least $400,000 in present dollars. Think about it, the guy would be paying $200,000 to receive assets with a return on investment of 48% per year. That's way out of league. His nearly risk free return on investment should be more like 10-20% or $400k-$960k portfolio price. The portfolio is definitely resellable as long as the income stream is solid
A. Sell portfolio for $200k, invest in lowest investment grade corporate bonds, they pay at most 8% (two coupons, one every six months). earn $16k per year in investment interest. We'll pretend you can reinvest the earnings, but since payment is only once every six months, you can only compound semi-annually. Additionally there is no guarantee that when you compound you will receive 8%. Also you might be stuck with the bond until maturity should interest rates rise (and they will rise).
B. Keep portfolio. Earn $96,000 per year.
Portfolio value will remain the same or increase as pool of traffic names available at drop decreases and competition increases (as it has the past five years). People will pay more and more years revenue for portfolios as the pool of available domains for purchase decreases and the number of buyers increases. Simple economics. You can invest your income stream as well.
Hell, with $96,000 per year, you are earning the money monthly. You can invest that money each month. You can lose it all and you will have it all back in 12 months.
What work are you doing for these domains?
You definitely made the right decision.
Stock market depression bla bla bla, just invest your income stream if you want. Don't sell the cash printing press.
$200,000 is a pittance and you would be a fool to accept it. $96k per year, that domain pool has a value of at least $400,000 in present dollars. Think about it, the guy would be paying $200,000 to receive assets with a return on investment of 48% per year. That's way out of league. His nearly risk free return on investment should be more like 10-20% or $400k-$960k portfolio price. The portfolio is definitely resellable as long as the income stream is solid
