PPP – PRIVATE PLACEMENT PROGRAMS
Perhaps the most common misconception regarding trade platforms is that they are the exclusive domain of the ultra rich through secretive, invitation-only investments. Well that is how it used to be until recently.
Often, clients are told that they must pay large, upfront fees to gain access to these exclusive investments. With PPP Direct there are no upfront fees and any company or individual that passes compliance/due diligence can participate in the programs listed on the website.
The Platforms are bound by law to conduct a thorough due diligence on each applicant. To pass compliance – it is of utmost importance that the submitted documentation is truthful, fully verifiable and fully compliant with the requirements and procedures for the particular program.
Private Placement Programs were created over sixty years ago to rebuild Europe the third world nations after WW II, thus the reason for such a high rate of return being allowed. Today, much of the profits realised by the Private Placement Programs benefit good-will projects. The investor however, is free to use the profits as they desire.
Private Placement simply involves buying and selling prime bank notes in Europe and Asia. At any given time some European and Asian banks must liquidate bank notes and will sell their notes at a discount. Other banks are cash rich and wish to add to their note portfolio and will pay a premium for these bank notes. Private Placement is the instrument by which these trades take place. Private Placement Platforms only trade prime bank notes by arbitrage. What arbitrage means is that the buy and sell contracts have to be agreed and binding before the discounted bank notes trades take place.
This is the safest way to trade the bank notes. This is all done by the trader for the Private Placement Platform. Since in the Private Placement Program traders only buy notes when they have a buyer at a higher price every trade has a net positive gain due to the “controlled trading” practices. There is zero risk to the Private Placement Platform traders, zero risk to the bank, and zero risk to the investor.
During the Private Placement activity the investor’s capital stays in their own bank account at all times. The investor’s funds are never traded, never accessed, never touched in any way. It is not used as a guarantee or reserve. Thus, there is zero risk to the investor’s capital. The two reasons for the investor’s blocked funds are to (a) satisfy bank regulations and (b) to permit the trader to raise a line of credit to amplify the volume of the trades.
THERE IS NO RISK TO THE INVESTOR WITH REAL PPPs
Private Placement Programs (PPPs)are legitimate investment vehicles that are accessible to a wide variety of investors. Part of the confusion regarding trade programs is the dual use of the acronym “PPP”. The acronym is also used to mean “Private Placement Partnerships”. Private Placement Partnerships are used by companies to raise capital from private investors often via a set of investment documents known as a Private Placement Memorandum (PPM). However, Private Placement Partnerships are very different to Private Placement Programs, that are described on this website.
The terms Prime Bank Programs, Prime Bank Investments, High Yield Investment Programs (HYIPs), Managed Buy-Sell Programs and Bullet Programs, however, are related to Private Placement Programs.
The transactions executed in Private Placement trade platforms are the buying and selling of fully negotiable bank instruments, medium-term notes (MTNs), Standby Letters of Credit (SBLCs) and Bank Guarantees (BGs). These instruments are delivered unencumbered, free and clear of all liens, claims or restrictions. Before the instruments are purchased, a contract is already in place for the resale of the bank instrument, consequently, the program’s funds are never put at risk.
The trade platforms use a deposit from a new client to create the Line of Credit that will be used for the purchase of the bank instruments. This deposit will be “blocked” and held untouched by the trader. The deposit is unblock at the end of the agreed term and is freely available again to the investor. Programs can be repeated and entry into larger programs is possible
THERE ARE BASICALLY TWO TYPES OF PROGRAMS:
– The traditional investment programs, which have a duration of one calendar year, ie ten banking months or 40 banking weeks
– The so-called SPOT or BULLET programs that last for just a few days or weeks and hardly exceed the period of one month. A series of bullet programs can be arranged sequentially to substantially grow invested capital.
INCOME FROM PROGRAMS
The profits from these trade programs are confidential between the trader and the investor. The level of profit and time scales are discussed between the trader and the investor before the contract is signed. The trader is open to answering any other questions and discusses the various options to help the investor make informed decisions.
Our Traders seek at all times to gain maximum returns for the investors.
Yields of these programs vary according to the time of year, the amount of collateral, the type of collateral, and the ratings of the bank and jurisdiction in which the collateral is situated. Various options are often available and discussed. The monthly returns can vary from 50% to over 400% in certain programs, depending on the aforementioned and numerous other factors.
MANAGED BUY/SELL PROGRAM
The Managed Buy/Sell Programs that we use trade 1-6 times per day, 4 days per week with a spread of 10-30% per trade. In these programs the platform splits the profits 50:50 with the investor. In the managed buy/sell programs the returns are on best efforts – based on the number of trades being generated per week.
Investors also have the option to compound profits, add funds to the trade or both. These programs are 40 week programs that pay out weekly or monthly depending on the level of entry. The advantages of these programs are that the investor gets paid on every tranche, low entry requirements with the ability to maximise profits by compounding.
For example, allowing for an average of 3 trades a day, 4 days a week at 15% the total return would be 180% per week which would be divided between the trader and the investor. Taking this into account it is easy to see why the yields are so high.
It is very important to understand that for the trader to be able to draw his credit line against the funds or instrument the capital/asset must be blocked in favour of the trader for the term of the contract. At the end of the trade term the block is removed and the asset is released back to the investor unencumbered and without liens.
Most managed buy/sell programs operate with $100 million or more and are meant for large investors. Relatively, few programs have been structured to accept small investments of $1 million or less. The banks bind Program Managers and Investors to very strict confidentiality agreements and it is very difficult to find the Program Managers or Investors willing to disclose their activities. Most programs are operated in the top European banks or domestic branches of top European banks and are therefore harder for U.S. citizens to access, research and invest in with confidence.
Investor behaviour depends on “perceived” risk rather than actual risk. While the actual risk may be very low, the “perceived” risk of a little known and somewhat obscure sounding business does dissuade many investors from getting involved. This is especially true because only specialised back room departments of the bank are involved with these transactions. Most bank officials have no knowledge of them, particularly in the United States. Knowledgeable banking officials are sworn to secrecy and would never divulge the existence of this market for fear of disturbing large depositors who would clamour for higher deposit yields.
In conclusion, when it comes to Private Placement Programs, with the smaller minimum investment amounts now available and the guaranteed returns the rewards can be great with the added advantage of no risk to the client.
Due to the regulations governing trade platforms the guaranteed returns quoted in a trade contract must be well below the actual returns.