Conference 7.286::digital

2927.0. "Digital's ESOP yields MINIMUM 70% annual ROI!" by BREAKR::BUDZOWSKI (Shouldn't you be committed?) Wed Mar 02 1994 14:27

If you are not in the Employee Stock Option Plan you are missing out 
on an investment opportunity that yields a MINIMUM annual return on 
investment of 70%.

The only assumption is that you sell the day after the stock purchase, and
the price does not vary  in that 1 day period.  Here's how to calculate
that fantastic ROI:

For example sake, assume the mythical trading price of $100 share, and
    you have enough money at the end of the 6 month period to buy 1 share
    of stock.

1. You acquire a share at a 15% discount ($85) and sell immediately for $100

2. You have made $15 on $85, or 17.6% profit, BUT...

3. You did not have the entire $85 invested for the 6 months period - you
started off at $0 investment and increased to a $85 over the period.  Your
average investment over the 6 month period was (0+85)/2=$42.50.  Thus, you
made a $15 profit on a $42.50 investment, or profit of 35.29%.

4. Finally, it did not take you 1 year to make that $15 profit - it took
only 6 months. Your 12 month ROI is more than 70%. 

    Don't spend it all in one place!

    This subject and others related to employees purchasing Digital stock
    is discussed in NYOSS1::DIGITAL_INVESTING. (KP7 or Select to add this
    conference to your notebook).
    
    Please continue this discussion in DIGITAL_INVESTING.
    
    Thanks,
    
    Bob - Co-moderator DIGITAL