by Marin Katusa, Katusa Research:
In nearly every aspect of life, there’s an “express lane” to success…a fast track available to the privileged few.
Traveling on one of these fast tracks is like being a member of an exclusive VIP club.
Members get all the breaks. They get the perks. They get preferential treatment.
For example, some kids are born into wealth and privilege. When a kid from this club breaks a rule, he’s more likely to get a slap on the wrist than face serious consequences.
You also have fast tracks at tourist attractions and amusement parks. Members of these clubs get instant access to rides while others wait in line for hours in the hot sun.
There are special clubs for when you fly. Buy the expensive ticket and you bypass the lines. After taking your seat, you sip champagne instead of getting elbowed by the fat guy in coach.
Whether you’re traveling, entertaining your kids, or anything else, getting the perks and skipping to the front of the line is good fun. You deal with less hassles. Things happen faster and easier for you.
VIP clubs exist for investors as well. Members of these clubs earn bigger returns in less time than “regular” investors.
I’m a member of such a club…and it has been extraordinary for me. I’ve made investment returns of 1,450%, 1,800%, and 2,440% using the strategy this club employs. It has literally made me millions of dollars.
But even small investments can pay off big with this strategy. A good friend of mine once turned a single investment of $4,800 into over $150,000 by using it.
I hope you start using this strategy very soon. It could make a huge difference in your net worth. If you feel like you’re behind on saving for retirement, this club could radically accelerate your retirement plans.
In this essay, I’ll explain how this club works…and how it relates to the all-new Project Ironman.
But before I do, please realize this club isn’t for lazy people. It’s not for those who refuse to learn new skills.
But what good club is?
Here’s how you can join this club…and get on the fast track to earning hundreds of thousands–even millions–of dollars from your investments (including the amazing Project Ironman).
Why Top Investors Love “Private Placement” Deals
When natural resource firms need to raise money to do things like drill for oil or develop gold mines, they often do it through “private placements.”
A private placement allows a company to sell shares to investors outside of the normal stock market.
In a private placement, companies typically offer shares at a discount to the current market value. This discount is often in the 5% – 25% range. The price of shares and the dollar amount raised are negotiated in advance.
For large investors, negotiating the price and the amount invested in advance is a huge positive. It means they can acquire large blocks of shares without dealing with the market’s day-to-day fluctuations. It means the share price can’t “run away” and shoot 25% – 50% higher while the position is being acquired.
Being able to acquire a large number of shares in a company at a set discounted price is enough to make private placements a very attractive investment vehicle for large investors.
But there is another component of private placements that makes them even better–it’s the icing on the cake.
A private placement offering can also include a stock option component, which are called “warrants.”
Warrants act like stock options in that they allow investors to buy a stock at a predetermined price in the future. They have finite life spans. Some warrants expire in one year. Some expire in two, three, or even five years.
And just like stock options, warrants can soar hundreds of percent in value when a company does well.
For example, a company doing a private placement at $0.50 per share could include a warrant with each share that would allow investors to buy additional stock for $1 per share at any time during the next three years.
If the company does not find success and the share price does not climb to $1 within three years, the warrants expire worthless.
But if the company does find success, and its share price climbs to $4 per share, the investor makes a profit of $3.50 on his shares ($4 minus $0.50), or a 700% gain. He can also “exercise” his warrants and buy stock for $1 per share, and sell it for $4 per share. This would net him an additional $3 per share profit, or an additional 600% gain on the original investment.
An investment of $10,000 turns into $80,000 with the shares alone. An investment of $10,000 turns into $140,000 with the shares and the warrant combined. The gain in the stock is great, but the warrant makes the investment much, much more profitable.
That’s the power of a warrant…and it’s why they are such an attractive component of private placements. In fact, it’s a rare, rare case that I will invest in a private placement that does not include warrants.
As I mentioned, a modest $25,000 can grow into $500,000 when you own both stock and warrants in a resource firm that achieves success.
Because you can buy stock at a discount AND get a warrant in a private placement, these deals are in high demand with wealthy individual investors and large institutional investors.
This demand makes private placements a good way for companies to raise large amounts of money quickly and easily from the best investors in the business.
In tomorrow’s essay, I’ll tell you more about participating in these incredible deals.
Please follow SGT Report on Twitter & help share the message.