posted on January 21, 2006 02:21:15 PM
I've read Sir Cobb's latest set of messages to us sellers. I *think* I understand most of it, but he talks about increasing FVF for the "middle tranche" to 3%. What the heck is a "tranche," and what are the parameters of the middle tranche? I've looked further and see no delineation of that. Anybody?
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posted on January 21, 2006 02:25:12 PM
If you look at a fish,the middle tranche is not the head ,not the tail but the part which everyone wants to eat,it is where the flesh is .
/ lets all stop whining !! /
posted on January 21, 2006 03:48:38 PM
It's a term frequently used for bonds and other securities when a sale/purchase is part of a larger transaction, for example, if a company arranged for the sale of 100M of bonds, but is putting them on the market 25M at a time, there will be 4 separate tranches.
I personally would not have used the term. I would have said that the second marginal rate in the FVF is 3%, covering between $x and $y. They're most easily described as being similar to the income tax marginal rates, but decreasing with increased value (i.e., the opposite of the income tax).
posted on January 21, 2006 04:35:27 PM
Thanks for the xplanation, Claude. Appreciate it. AND I still want to know what the parameters are for that danged "tranche." Anyone know where I can find that???
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I *ASSUME* he is referring to the $25.01-$1000.00 group listed below, where the FVF is 2.75% of the value above $25.00
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Final Value Fees
Closing Price Final Value Fee
Item not sold No Fee
$0.01 – $25.00 5.25% of the closing value
$25.01 – $1,000.00 5.25% of the initial $25.00 ($1.31), plus 2.75% of the remaining closing value balance ($25.01 to $1,000.00)
Equal to or Over $1,000.01 5.25% of the initial $25.00 ($1.31), plus 2.75% of the initial $25.00 - $1,000.00 ($26.81), plus 1.50% of the remaining closing value balance ($1,000.01 - closing value)
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Dr. Arcane, revelator of mystical secrets
http://www.drarcane.com
Got questions about the secrets of the universe?
[ edited by DrArcane on Jan 21, 2006 04:48 PM ]
posted on January 21, 2006 07:03:05 PM
Dr. A -- You are correct. Another clue to your accuracy would be the amount it is currently and what it will be... The numbers align just right.
Wayne
Never explain -- Your friends do not need it and your enemies will not believe you anyway.
~ Elbert Hubbard
For the Excel oriented, the new FVF formula, assuming that the final value is in cell B6, looks like this:
=ROUND(IF(B6<25,0.0525*B6,IF(B6<1000,1.31+(0.03*(B6-25)),30.56+(0.015*(B6-1000)))),2)
[edited to clean up the columns just a bit]
[ edited by cashinyourcloset on Jan 21, 2006 07:55 PM ]
