Re: [ANN] ArbCoin iCO offering the the potential for minimum ROI of %9900
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My strategy works like this.
Step 1: I purchase a majority stake in a company.
Step 2: I will sell back my stake back to the company for a sum either double the price I paid to acquire the stake or greater than $1000000 (whichever is greater) in exchange for a convertible debt security that allows me to purchase the companies stock at a 99% discount. The convertible debt is payment from the company for me to sell my shares back to the company.
Step 3: I get the company listed. (If the company is already listed this step does not apply)
Step 4: Once the portfolio company is traded I short sell the stock. I cover my shorts by getting the company to issue the shares to me at a 99% discount. The company will do this because I am entitled to a majority stake and if I convert the debt into equity I will have a majority share which will enable me to get rid of management and install a new management team who will accept an arrangement to issue shares to myself at a %99% discount.
Step 1: I purchase a majority stake in a company.
Step 2: I will sell back my stake back to the company for a sum either double the price I paid to acquire the stake or greater than $1000000 (whichever is greater) in exchange for a convertible debt security that allows me to purchase the companies stock at a 99% discount. The convertible debt is payment from the company for me to sell my shares back to the company.
Step 3: I get the company listed. (If the company is already listed this step does not apply)
Step 4: Once the portfolio company is traded I short sell the stock. I cover my shorts by getting the company to issue the shares to me at a 99% discount. The company will do this because I am entitled to a majority stake and if I convert the debt into equity I will have a majority share which will enable me to get rid of management and install a new management team who will accept an arrangement to issue shares to myself at a %99% discount.
I'll bite, I am verifiable here, LinkedIn, Twitter. 12 years experience as a hedge fund manager across asset classes. Advisor to the Financial Times Alphacoin impending ICO.
You will never find borrow to make the short as you have sold back 51% of the share into the company treasury.
If the company is the one lending out the shares then that's your counterparty, but the original purchase is likely a secondary so that cash you paid for the 51% stake is gone to a happy camper. So you'd convert the bond to shares and give the 51% shares back to.. The company to close your short
Market makers aren't dumb or automated (well, in the equity world, token market makers may be another story..) and would never provide a company with that convertible debt arrangement liquidity, nor would it be able to list given its heavy debt burden.
Given you are likely buying a company that has < 100% of its market cap in cash this is always a losing strategy.
You are absolutely correct. However, most retail investors throw their money away when they hear operators talk about arbitrage.