Comments on: Investment Returns- Unrealistic Expectations? http://www.thickenmywallet.com/blog/wp/2007/06/19/investment-returns-unrealistic-expectations/ Everything to do with thickening your wallet Wed, 01 Feb 2012 15:44:00 +0000 hourly 1 http://wordpress.org/?v=3.3 By: admin http://www.thickenmywallet.com/blog/wp/2007/06/19/investment-returns-unrealistic-expectations/comment-page-1/#comment-194 admin Wed, 20 Jun 2007 14:08:48 +0000 http://www.thickenmywallet.com/blog/wp/?p=67#comment-194 FJ- just to clarify, the business we are in is lending so to achieve 15% ROI requires us to undertaking riskier loans. Remember that the sub-prime market in the US towards the end of its run was lending to people with no assets, no income and no jobs. We have no intention of engaging in a similar strategy. Hope that makes it clear. FJ- just to clarify, the business we are in is lending so to achieve 15% ROI requires us to undertaking riskier loans. Remember that the sub-prime market in the US towards the end of its run was lending to people with no assets, no income and no jobs. We have no intention of engaging in a similar strategy. Hope that makes it clear.

]]> By: The Financial Blogger http://www.thickenmywallet.com/blog/wp/2007/06/19/investment-returns-unrealistic-expectations/comment-page-1/#comment-191 The Financial Blogger Wed, 20 Jun 2007 11:34:59 +0000 http://www.thickenmywallet.com/blog/wp/?p=67#comment-191 There is one thing good about the market. When people are getting overconfident and expect 15% et up return with no risk, the market will surely put them back to the real world with a severe correction. It is funny to see that people doesn't learn from history. We all know the market will drop, the real (and though) question is when? There is one thing good about the market. When people are getting overconfident and expect 15% et up return with no risk, the market will surely put them back to the real world with a severe correction. It is funny to see that people doesn’t learn from history. We all know the market will drop, the real (and though) question is when?

]]> By: FinancialJungle.Com http://www.thickenmywallet.com/blog/wp/2007/06/19/investment-returns-unrealistic-expectations/comment-page-1/#comment-188 FinancialJungle.Com Wed, 20 Jun 2007 03:53:27 +0000 http://www.thickenmywallet.com/blog/wp/?p=67#comment-188 Many companies can safely return 15+% ROI in relation to invested capital. What investors will earn ultimately depends on the entry price, which is beyond the companies' control. I hope I'm using the terminology right. If the shares are priced low enough, even a microcre company can earn an internal rate of return > 15% for investors. Conversely, an investor buying a company with 15% ROI can still lament over a low internal rate of return if the shares were purchased high enough. I guess my two points are: * High ROI doesn't equate high risk. * It's not the company's fault if the investor doesn't earn 15% rate of return. This probably isn't the main message of your post anyway, and I do agree with you that 15% rate of return is a stretch over the long haul. Great post! Many companies can safely return 15+% ROI in relation to invested capital. What investors will earn ultimately depends on the entry price, which is beyond the companies’ control.

I hope I’m using the terminology right. If the shares are priced low enough, even a microcre company can earn an internal rate of return > 15% for investors. Conversely, an investor buying a company with 15% ROI can still lament over a low internal rate of return if the shares were purchased high enough.

I guess my two points are:
* High ROI doesn’t equate high risk.
* It’s not the company’s fault if the investor doesn’t earn 15% rate of return.

This probably isn’t the main message of your post anyway, and I do agree with you that 15% rate of return is a stretch over the long haul. Great post!

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