Comments on: Cash received for Advanced Nutraceuticals (ANII) http://www.experiglot.com/2006/10/05/cash-received-for-advanced-nutraceuticals-anii/ Because you shouldn't need an MBA to be savvy about finance and business Tue, 07 Sep 2010 14:14:05 +0000 hourly 1 http://wordpress.org/?v=abc By: Experiments in Finance’s Take on Contributor’s Corner - Fat Pitch Financials http://www.experiglot.com/2006/10/05/cash-received-for-advanced-nutraceuticals-anii/comment-page-1/#comment-4161 Experiments in Finance’s Take on Contributor’s Corner - Fat Pitch Financials Fri, 13 Oct 2006 15:37:27 +0000 http://www.experiglot.com/2006/10/05/cash-received-for-advanced-nutraceuticals-anii/#comment-4161 [...] Ricemutt signed up as a paying member of Fat Pitch Financials Contributor’s Corner a few months ago and asked me if she could write about her experience. I agreed and she posted an article detailing her first ever special situation investment (Advanced Nutraceuticals) based on information posted in Contributor’s Corner. This past Thursday Ricemutt posted the results of her experiment. I’m happy and proud to report that Fat Pitch Financials Contributor’s Corner helped Ricemutt earn $259.51, a 14.9% gain. She calculated that her investment had an annualized return of 176.4% (APY). [...] [...] Ricemutt signed up as a paying member of Fat Pitch Financials Contributor’s Corner a few months ago and asked me if she could write about her experience. I agreed and she posted an article detailing her first ever special situation investment (Advanced Nutraceuticals) based on information posted in Contributor’s Corner. This past Thursday Ricemutt posted the results of her experiment. I’m happy and proud to report that Fat Pitch Financials Contributor’s Corner helped Ricemutt earn $259.51, a 14.9% gain. She calculated that her investment had an annualized return of 176.4% (APY). [...]

]]> By: Ricemutt http://www.experiglot.com/2006/10/05/cash-received-for-advanced-nutraceuticals-anii/comment-page-1/#comment-3801 Ricemutt Thu, 05 Oct 2006 17:11:08 +0000 http://www.experiglot.com/2006/10/05/cash-received-for-advanced-nutraceuticals-anii/#comment-3801 There was some debate about this on the special situations investing site. You can either calculate annualized return based on a compounded (CAGR) basis, which would have made the annualized return more like 176.4%. (To see this, use the CAGR calculator under the "Online calculators" link on the right sidebar of this site and enter in initial=1736.49, final=1996, years of investment=50 days/365 days=0.137 and hit "Calculate"). But that assumes that you're compounding and able to reinvest the total amount you receive each time at the same rate again, each period. If you don't assume that and merely annualize the rate, then you'd take 14.9% and multiply by 7.3 (=365 days/50 days) to get 108.8%. This ignores compounding and basically says that I got 14.9% over 50 days, but at that same rate, if I had held it for a full year, I'd have made 108.8%. All theoretical numbers only meaningful for rough comparisons, of course! There was some debate about this on the special situations investing site.

You can either calculate annualized return based on a compounded (CAGR) basis, which would have made the annualized return more like 176.4%. (To see this, use the CAGR calculator under the “Online calculators” link on the right sidebar of this site and enter in initial=1736.49, final=1996, years of investment=50 days/365 days=0.137 and hit “Calculate”).

But that assumes that you’re compounding and able to reinvest the total amount you receive each time at the same rate again, each period.

If you don’t assume that and merely annualize the rate, then you’d take 14.9% and multiply by 7.3 (=365 days/50 days) to get 108.8%. This ignores compounding and basically says that I got 14.9% over 50 days, but at that same rate, if I had held it for a full year, I’d have made 108.8%. All theoretical numbers only meaningful for rough comparisons, of course!

]]> By: ronbo http://www.experiglot.com/2006/10/05/cash-received-for-advanced-nutraceuticals-anii/comment-page-1/#comment-3800 ronbo Thu, 05 Oct 2006 17:03:32 +0000 http://www.experiglot.com/2006/10/05/cash-received-for-advanced-nutraceuticals-anii/#comment-3800 How did you calculate your annualized return? How did you calculate your annualized return?

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