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How do you own a stock without directly owning it? Several ways exists for this from unit trusts, to mutual funds and even options. However, today's discussion will be centered around exposure on JMMBGL.
jamstockex.com/jmmb-group-lim… JMMBGL is set to acquire a 20% stake in New Sagicor between September-December. With this acquisition, JMMBGL will treat New Sagicor as an investment in associate. This means a portion of New Sagicor's P&L along with their balance sheet will be recorded
on JMMBGL's books. As a result, JMMBGL's profit will grow massively while their balance sheet will have more liabilities. Through this expansive growth, JMMBGL's stock price should move much higher going forward. Now, as investor, how do you want to own that JMMBGL exposure?
You can always buy the JMMBGL stock and take on the full exposure of the company's new expansion or utilize other means. These include unit trusts, Panjam and Proven Investments Limited. Let's explore these.
With a Unit trust that is focused on equities and carries some level of exposure to JMMBGL, you can get increased gains through the overall increase in the portfolio's value. This carries the least amount of exposure while still being able to derive gains.
Panjam is the 4th largest holder of JMMBGL's ordinary shares with a 6% stake. They account for JMMBGL as an investment based on the company's stock price, get cashflow from the dividends paid by JMMBGL and still have exposure to New Sagicor's local subsidiary, Sagicor Group Ja.
Since acquiring JMMBGL from NCBFG last year, the stock price for JMMBGL has almost doubled since then which is recorded on the company's balance sheet as an investment. Owning Panjam would afford you exposure to JMMBGL and Sagicor Ja.
Finally, we reach Proven Investments Limited. Proven has a 20.01% stake in JMMBGL, making it the largest shareholder. Proven records JMMBGL as an investment in associate and records JMMBGL's profit on their P&L statement along with some of their assets and liabilities.
Proven provides the highest level of exposure compared to unit trusts and Panjam. As a diversified St. Lucian holding company, Proven offers more regional coverage while having that same JMMBGL exposure on their financials. Proven will receive dividends from JMMBGL and basically
reflect part of JMMBGL'S P&L statement whenever they release their financials. So when JMMBGL does well, so does Proven from the associate stake treatment. These are the ways one can consider exposing themselves to JMMBGL from owning the stock outright to owning another company
with a stake in JMMBGL. Read well and always speak with your licensed financial advisor where applicable. Indirect exposure is one way of benefitting from a company's growth if one doesn't want to take on the direct exposure or can't afford the stock.
The packaging providers for Amazon were used as a gateway to benefit from Amazon's growth for those who couldn't afford the stock outright. They have began to lag while Amazon's stock price continues to go up, but that's just the nature of equities.
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