Step Thirty to a Fortune:
How to make even more money in CD's
I sold Christmas tapes, and I sold the first Christmas CD. Now I will sell a second Christmas CD
I made a little money on cassette tapes. There is no reason why I can't make money on the unopened Disney CD tapes my wife found in the dumpster where she was gathering boxes.
Step 30 from our overview guide calls for an investment range of up to $13.09 hoping to grow to $14.40 or more.
From $244.33 in reserve cash equity, I can invest up to $13.09 in expectation of a $14.40 deal or better. My expected outcome is to profit by $1.30 or more.
Starting capital $244.33
Planned investment risk $13.09
Investment receipt goal $14.40
Once we discover a way to make a gain, repeating that action stands a good chance to make a similiar gain.
We listed another set of Christmas CD's on ebay.
I sold this CD set for $15.37 plus $2.67 for first class mail. Total sale counting postage was $18.04
Costs for this transaction totaled about $7.35.
sale price $18.04
Actual investment and expense $7.35
Gross Profit or loss this deal
Ending gross capital (before deductions) $255.02
Does the past result always equal the future result? The second sale was a little less than the first so the past does not always equal the future. However, it may often indicate the probability of the future.
What did I learn from this deal? A risk in capitalism is not the same as a gamble. The risk of a good penny capitalist should be calculated on past experience rather that a blind hope for profitable results.
Little by little our deals are getting bigger and bigger. Investing in this incremental fashion takes most of the gamble out of it. It also builds confidence. With cash reserves much larger than my investments, I can afford to lose the whole investment without ruining my capacity for future investment.
I started with $244.33 in funds. I planned to limit my risk to $13.09 or less expecting a growth to $14.40 or more. After the sale before tax and charitable deductions I had $251.50.
35% tax on profit of $10.69 would be $3.74. That leaves $6.95
In gratitude to our abundance we pay forward 10% of our increase, , for some worthy cause = $.70.
After this deduction we are left with a new $6.25 gain.
Now we have $250.58 unencumbered capital for investment and surplus to keep us investing even in the event of a total loss.