ruicarlov
VIP Member
Offline
PTCMan! The doodle superhero of the PTC world!
Posts: 1479
Portugal
Gender:
|
Some interesting maths a referral of mine once made told me it was best to cashout and reinvest while we could use points. For two reasons: 1) You get 1 point per each $1, which is kind of a 10% deposit bonus (though we have 5% withdrawal fee); 2) The ROI % grows slower for the same money cashed out, which means it takes longer for cross the 150%, 200% platforms, where more of our earnings have to go to the purchase balance.
Let's ignore cashout comissions to make calculations simpler. For example, if you invest $500 and buy 20 shares, when those shares end you'll have $600. If you withdraw that money, you'll get 100$ in purchase balance and $500 in your account. This means your ROI is now 100%. Now let's suppose you buy shares again with the money you withdraw plus the ones in your account balance. This means you buy $600 in shares (that's 24 shares). When these new shares end, you'll have $720. If you withdraw all of it, you get 144$ in purchase balance and you get $576 in your account. This means your ROI is 107.6% (You deposited $1000 (500+500) and withdrew $1076. This means that at this point in time, you have a $220 profit ($144 account + $76 Paypal/payza).
Now let's go with an example where you don't withdraw. With $500 you buy your first 20 shares. At the end you get $600. You reinvest directly and at the end of those new shares you'll have $720. You withdraw everthing and you get $144 in the account balance and 576$. You ROI is effectively higher at 115.2%, even though your have the same same profits.
Of course that by giving up those 5% in exchange for the 10% worth in points, we slow down a bit the rate at which we can grow our share count. But overall this stands true.
|