Yep its amazing how many companies operate like this, really hardly anything getting done, paying themselves 100s of thousands a year, for years and years, when there are too many shares on issue , they consolidate, name change, and raise again, and do the whole story again. Would be nice to have a gig like that, $200k - $300k a year, for life, sign me up!
Its quite dismal when you look at the reality of it all, but its actually data backed that 98%+ of all companies listed on the ASX end up worthless, just goes to show how hard it really it is to get a winner on the ASX, the overwhelming majority of listed companies in any given era are speculative stocks with nothing but hope and hype and almost all will disappear worthless, it really cant be argued as its data backed that 98% of stocks listed disappear worthless.
So who are the real big winners, well knowing that most stocks end up worthless, its the lead brokers who make money raising for the company, the management and staff of the company who get paid great salaries along the way before the company is worthless.
Usually its these same lead managers, directors, etc, that will then consolidate all shares, do a name change, new prospectus and do the whole thing again, this is what they call life style companies, which is unfortunately very common on the ASX, a look at Vlads history is eye openinig, just some basic research of any company you will find most directors have been directors for decades, they usually try to dress this up as a positive , as they are "experienced" but a quick look at most directors past you will find they were directors of several companies that never made a cent for shareholders but were paying for their life style in the form of salaries and performance rights.
Basically the theme is management win, shareholders lose, its a sobering reality.
The lessons to take out of this in my opinion are not to get too attached to the story, realise that its a tiny fraction of these companies that end up making it, so if you are lucky enough to be in profit on speculative stocks might be a good idea to take some money off the table along the way. Also some basic research on the directors, CEO, etc, see where they spent the last 5 years, will go along way to help you not get attached, you will usually find they have gone from company to company without performing for shareholders but increased their bank balance from shareholders.
I know many here were holding SRN when we were hitting 4cents in 2022 , hurts to only to watch it back now to lows not seen in years. I for one learnt my lesson, if we see 2-4 cents again will be taking most off the table!
Expand
(20min delay)