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Discussion.
Let’s begin our discussion by repeating the basic information about the DerMundo investment plans as given in the website as well as what we determined about the plans in Part 1 of this review.
Here’s the basic information:
- Beginner Plan
- 1.25% daily for 20 business days
- $25 – $1,000
- Advanced Plan
- 2.5% daily for 30 business days
- $250 – $5,000
- Expert Plan
- 5% daily for 40 business days
- $1,000 – $10,000
Remember that all of these investment plans return your deposit at their conclusion.
Here’s what we found out in Part 1 of the review:
- Plan Length of plan in calendar days
- Beginner 28 days
- Advanced 41 days
- Expert 55 days
- Plan Days to break even (business days)
- Beginner 20 days (at end of plan)
- Advanced 30 days (at end of plan)
- Expert 20 days (halfway through the plan)
- Plan DNI
- Beginner 0.89%
- Advanced 1.83%
- Expert 3.64%
Next, some general comments. First, the length of these investment plans seems to be about right. They are long enough to make sense, but not so long that the investor will be unduly worried about the program closing before the term of his investment is complete. Second, the minimum investments, especially for the Beginner and Advanced Plans are reasonable. All serious online investors will be able to afford them. However, the Expert Plan, with a minimum of $1,000, might be out of reach of many investors. This is actually a GOOD thing from the point of view of program survivability. We’ll discuss that more later. Third, the DerMundo investment plans all provide a daily return — which is a good feature. However, they hold a person’s deposit until the end of a plan — which is bad because the investor is at risk of losing his deposit if the program closes prematurely. Of course, this is a better arrangement than plans that also hold a person’s earnings until the end of a plan (we refer to these plans as “after” plans), but it is a worse arrangement than plans that return a person’s deposit as part of his earnings. So, as far as TYPE of investment plan is concerned, the DerMundo plans could be better and they could be worse; they are a sort of middle road.
Next, let’s try to zero in on the level of risk associated with the DerMundo investment plans. Basically, it comes down to the amount of interest that a plan pays. Naturally, and no matter what a program website says about the amount of money that a program generates, an investment plan that pays a high interest is riskier than a plan that pays a low amount. The reason is obvious; it is harder for a program to pay high interests than low ones. That’s simple logic. And, if an investment plan pays a high interest rate, it isn’t only the specific plan that is at risk, it is the entire program. You cannot separate plans from the program.
In HYIP Insights #12, we suggested that the long-term survival of programs offering investment plans with DNIs higher than around 2% might be at risk. In this regard, the Beginner and Advanced plans are OK. However, the Expert Plan presents a problem. A saving factor might be that the relatively high minimum investment of $1,000 will probably minimize use of this plan and thereby lower the impact of the high interest payments it requires on the survival of the program. That is probably the best we can hope for.
As far as profitability is concerned, it always corresponds to risk; high profits mean high risk and vice versa. Looking at the Beginner Plan, and multiplying its 0.89% daily profit by seven, you come up with an average weekly profit of around 6%. This should be OK for the conservative investor. For the Advanced Plan, the average weekly profit jumps up to over 12% — which is starting to get high. The average weekly profit for the Expert Plan calculates out to around 25% — which, at least in my opinion, is excessive. Again, from the point of view of program survival, it would probably be a good idea if investors avoid this plan. Ideally, the high minimum investment might take care of this.
Earnings Example.
Let’s work an example for the Advanced Plan. This might become the most popular plan of the group. It pays an attractive return while still being affordable to a large segment of the online investor population. We’ll assume a deposit of $500. Every business day you will receive 2.5% of this, or $12.50 (.025 x 500). By the time the plan ends in 30 business days, you will have received a total of $375 which is three-fourths of your investment. You will break even when your investment of $500 is returned to you at this time. So, if the program survives until the investment plan ends, the daily returns of $375 become your net profit.
Conclusions.
DerMundo offers three investment plans. All of them provide a daily interest and return the investor’s deposit at their conclusion. Two of the plans do not break even until the investor’s deposit is returned. The third plan, which is much more lucrative than the first two, breaks even midway through it. Although the high returns promised by the third plan might put the survivability of the program at risk, a compensating factor is the fact that the minimum investment required to take advantage of this high interest plan is also rather high and will probably disciourage its use. Everything considered, this set of investment plans is attractive. However, there are a few things about it that might make it riskier than many others. As is true with putting money into any online investment program, the potential investor should do his “due diligence” beforehand.
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