The Offering Price vs. The Stock Market Price
iConsumer is unusual because there are two prices you should care about regarding our Series A Preferred Stock (traded under the symbol RWRDP, currently on the OTC QB market).
Why You Might Care
We use the Offering Price when calculating your stock back. You may want to consider using the Market Price when determining how good a deal you’re getting, as well as whether or not iConsumer is a good investment for you.
The first price is our Offering Price. This is the price we’ve agreed with the SEC that we’ll use when somebody earns our stock by shopping. This price started at $.05/share, then we changed it to $.09, then $.15, and on August 1, 2019 to $.18 per share. It’s hard to change frequently, and it also controls the price at which iConsumer sells its freely tradeable stock to investors.
Most importantly, it may vary radically from the Stock Market price.
The second price is the Stock Market price. This is the price at which investors in iConsumer are buying and selling RWRDP on the open market. This price can vary radically, not only each day, but sometimes even during the same day. Or, it can stay about the same for long periods of time.
iConsumer controls the Offering Price. The market controls the Stock Market Price.
The stock market price can change minute by minute, and reflects the current perception by investors of the smartness of owning iConsumer stock. The Offering Price reflects a number that iConsumer unilaterally chose, based upon its best guesstimate of what that number should be for a year or so.
Why this matters when you’re earning stock from shopping
The percentage Stock Back you get is calculated using the Offering Price. Because the Stock Market price and the Offering Price are usually different, you may wish to think about that.
A quick example:
If we say you’re getting 5% back, you spend $100, and the Offering Price is $.18/share, you’re going to get $5 of RWRDP at $.18/share. That’s 27.78 shares of stock.
Now, the fun part. If the market price of that stock at that moment is $.25/share, you may want to consider that you’re receiving 27.78 times $.25, or $6.95 in stock. Which is not 5% back, it’s 6.9% back.
If the stock market price is LESS than the Offering Price, then the percentage will be lower.
Why two prices?
iConsumer is a Reg. A+ filer. This is a special SEC category (really, a whole set of regulations) that makes it possible for us to have 1,000,000 shareholders someday, and also makes it easier and less expensive. Here’s a little bit more about being a Title IV, Tier 2 filer under the JOBS Act.
One of the requirements we must adhere to is selling our shares at a “fixed” price. That fixed price becomes the “Offering Price”. The opposite of selling our shares at a fixed price is selling them “at market” or “at the market price”. The fixed price is stated in our offering circular (and any supplements to that document). It takes weeks (and SEC review) if we wish to change the price outlined in the offering circular by more than 20%. That makes changing it frequently a non-starter.
If we were a traditional, “fully reporting” SEC filer, we could state in our offering circular that we would sell our stock based upon the price in the stock market. In other words, our “Offering Price” would change to reflect the stock market price.