Important Club news - all members please read

Discussion of the proposed Cashback Investment Club

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garindan
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Important Club news - all members please read

Post by garindan » Sun Oct 25, 2015 9:14 am

Members,

As some of you will know there has been a thread on another part of the forum where one of our members has decided to leave imutual. As you probably also know, if you close your imutual account you also will have to cease being a member of the Cashback Investment Club as it contravenes our rules.

The member is "davidlmorgan" and I have been able to discuss leaving the club with him. David is keen for us not to have to sell a share, which is very reasonable of him. According to the club's rules we have 3 months to return the value of his investment, which totals ~£530.00 after Richard, our treasurer, valued his unit holding. We currently have ~£250.00 in our cash reserves towards this repayment.

So what do we do now? Well as we have some time it would be optimal if we can raise the remaining funds through member deposits into the club to reach the amount needed. This way we can simply pay David's holding value out directly, keep our current portfolio intact and then progress the club from there. The sub-optimal option is to sell a share, potentially at a loss, and charge a fee for this, according to the rules. If we are able to go the optimal route then it would make a lot more sense and cause less of an issue. Therefore I would ask all members to consider contributing more funds to the club as a priority. As we have never had this situation before it is hard to know whether this is something we can easily achieve or not. I guess time will tell!

Of course we may have to sell a share if the above is not possible. So, here is a consideration for us to also think about. Until recently our shares have been bogged down by the notorious troubles that have been effecting global share prices. The tide seems to be turning, though it is not something we can say with full confidence at this point. Of note though is the recovery of Sainsbury, one of our holdings. We have moved from a position of being ~20% down on purchase price to being almost even again. As I see it, supermarkets are still in turmoil. The next interesting part of the timeline will be the assessment of Christmas trading. If it is good I'd expect the shares to rise and if sales on the supermarkets do not meet expectations we could of course see falling prices again. That is a bit too black and white but is the sense I personally have. Be it that this sector is a bit of a minefield right now should we consider selling our Sainsbury holding if we do need to sell a share? Would anyone have a preference to sell an alternative share?

Lastly - David was the club's secretary. With his leaving we now have a vacancy for this position. I will be discussing what we would like this role to involve with Richard shortly and we will share with you soon. In the meantime, you might like to consider if being one of the club's official officers is something you would be interested in :thumbup:

Thanks,
Andrew
Chairman: iMutual's Cashback Investment Club (CIC) - contact me about joining!
Visit the Cashback Investment Club forum to find out more.

mike
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Re: Important Club news - all members please read

Post by mike » Sun Oct 25, 2015 9:39 am

Is it possible for us to select the automatic redemption at £10 and when the appropriate date arrives, Richard sweeps whatever balance is redeemable on that day even the less than £10 balances.
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Re: Important Club news - all members please read

Post by kevinchess1 » Sun Oct 25, 2015 10:24 am

We should have enough cash in reserve to cover our biggest shareholder leaving
having said that, we are a newish club and i can understand the desire to have shares rather than cash
I think we should see if we can raise the £280 from members within 2 months and. if not, then list all of our shares in a vote as to which one we sell
When that said and done, we should then build up a cash balance to cover this issue for next time
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Re: Important Club news - all members please read

Post by hiswitzend » Sun Oct 25, 2015 1:55 pm

I have passed some funds over so this should help a bit
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Re: Important Club news - all members please read

Post by AAAlphaThunder » Sun Oct 25, 2015 2:24 pm

I'm sorry to see you leave. I wish you the best wherever you go :)

I have non-imutual cashback funds (enough to easily look after David and send him on his way with a smile). Can I use non-cashback funds to take care of David?
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William Joseph1
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Re: Important Club news - all members please read

Post by William Joseph1 » Sun Oct 25, 2015 4:38 pm

underdog wrote:I'm sorry to see you leave. I wish you the best wherever you go :)

I have non-imutual cashback funds (enough to easily look after David and send him on his way with a smile). Can I use non-cashback funds to take care of David?
This would be against the rules and ethos of the club.
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garindan
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Re: Important Club news - all members please read

Post by garindan » Sun Oct 25, 2015 6:28 pm

kevinchess1 wrote:We should have enough cash in reserve to cover our biggest shareholder leaving
having said that, we are a newish club and i can understand the desire to have shares rather than cash
I think we should see if we can raise the £280 from members within 2 months and. if not, then list all of our shares in a vote as to which one we sell
When that said and done, we should then build up a cash balance to cover this issue for next time
I agree and I have been trying to ensure we would always have enough to cover the majority of any member leaving, however, David is the worst case scenario - he was the biggest unit holder. It seems to be counterproductive to hold more than a few hundred in reserve when only a few members have more than that in holding, we have only a small number of investments and the risk is reasonable to cover the extra needed in contributions within the 3 month timescale. I think you appreciate that from your reply but I wanted to make sure the reasoning is there for all members to know :thumbup: I think we have been implementing a reasonable policy so far. Hopefully we won't have more leavers in the coming months. I know David wasn't interested in leaving either should he have decided to stay at imutual, so this circumstance is disconnected from the club itself really and probably more of a unique situation.

Anyhow - onwards and we'll see how we progress. I'll keep you all informed regularly! :thumbup:

Thanks for understanding and suggesting ways forward - it is good to see quite a few responses already. :)
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Re: Important Club news - all members please read

Post by AAAlphaThunder » Sun Oct 25, 2015 7:46 pm

ItsADunDeal wrote:
underdog wrote:I'm sorry to see you leave. I wish you the best wherever you go :)

I have non-imutual cashback funds (enough to easily look after David and send him on his way with a smile). Can I use non-cashback funds to take care of David?
This would be against the rules and ethos of the club.
A bit like the SBRY shares. If we had sold them at -20%, today we wouldn't be sitting on SBRY at nearly 0% (no loss / no profit).

In fact, and for the record I can offer the imutual Cashback Inveestment Club members a buffer of £1,000 cash. This gives us greater flexibility to invest with the funds we have in the knowledge that we have a safety net, should the need arise.

Once everyone has put their cashback funds in and we are still short I am happy to paypal imutual the difference and we keep all of our investments.

So in the first instance we try to use the funds available, if short I will put my "hard-earned" cash to keep us on course.

Selling shares should be a last resort as we incur costs.
[Secretary] imutual Cashback Investment Club

William Joseph1
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Re: Important Club news - all members please read

Post by William Joseph1 » Sun Oct 25, 2015 8:26 pm

As a matter of interest would he be paid out at the value of his units on the day he made the decision or on the day the payment is made?
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Re: Important Club news - all members please read

Post by AAAlphaThunder » Sun Oct 25, 2015 8:30 pm

With respect to the vacancy for CIC Secretary Officer, I eat hard-work for breakfast. As the board stands, I would not be the most appropriate person for this position (some CIC members may leave).
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