This program moved to PROBLEM status! Do NOT invest there!
The EQTrade Investment Plans.
In our recent “First Thoughts” article about EQTrade, we summarized their investment plans as follows:
For the investor, EQTrade offers three investment plans. All of them pay interest on a daily basis and return your investment as part of your earnings (the best type of investment plan). Daily returns run from 4% to 6% and the length of the investment period varies from 50 days to 30 days, the longer-term period corresponding to the lower interest and vice versa. Something that strikes me about the investment plans is that the minimum investment limits are rather high, perhaps prohibitively high — at least for the two higher interest plans.
We made a serious error in this introduction as we failed to note that the EQTrade investment plans only pay interest on WORKING days, not on calendar days. Making this correction, and adding the complete information from the website, here’s what the plans look like:
- Plan #1
- 4% daily for 50 working days
- .01 – .49 BTC
- Plan #2
- 5% daily for 40 working days
- .5 – 4.99 BTC
- Plan #3
- 6% daily for 30 working days
- 5 – 100 BTC
Analysis of the EQTrade Investment Plans.
Let’s first determine how long it takes each of the EQTrade investment plans to break even. Looking at Plan #1, if you divide 100% by the daily return of 4%, you find that the plan breaks even in 25 (100/4) working days. We think in terms of calendar days. So, let’s convert this to calendar days. Since there are roughly 22 working days in a 30 calendar day month, you can multiply the 25 working day figure by the conversion factor of 30/22 to get that the plan will break even in 35 calendar days.
Similarly, if you do the same arithmetic for the other two plans, you will get the following breakeven points
- Plan Break even point
- #1 35 days
- #2 28 days
- #3 20 days
Next, let’s determine the average daily net interest (DNI) that you will earn from each of these investment plans. Remember that DNI is the total net interest (or profit) that you earn from an investment plan averaged out over the length of the plan (IN CALENDAR DAYS, so that you can compare DNIs from different investment plans).
For Plan #1, the total GROSS interest that you will earn from the plan is the daily gross interest of 4% times the 50-day length of the plan, or 200%. Since this includes your investment, you must subtract 100% to get the total NET interest which, in this case, will also be 100%. In order to get DNI, and as I indicated above, we have to average this out over the number of calendar days in the plan. So, again multiplying by our 30/22 conversion factor, you can see that the 50 working day plan is actually around 69 days long. Finally, to get the DNI for this plan, we average the 100% total net interest over the 69 calendar day length of the plan by dividing it by 69 to get 1.45%.
If you repeat these calculations for the other two investment plans, you get the following results:
- Plan DNI
- #1 1.45%
- #2 1.82%
- #3 2.86%
If you are familiar with our reviews, you will realize that these results give hopeful signs that we might, indeed, have a program that offers sensible returns which are conducive to its long-term survival. However, we’ll go into this more deeply in Part 2 of this review when we will discuss the program in detail in an effort to uncover its strong and weak points and, hopefully, draw some conclusions that might be useful to the online investor. Please stay tuned. Part 2 will be available in a day or two.
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