Did you know the cost of a chicken can range from $3 to $100 each, depending on breed, age, egg laying or not, and demand for chickens in the general market? An egg laying chicken is far more valuable, and I’m happy to report my $12 hatchlings would now fetch us a sale price of least $70. That’s a 483% return in just five months — fantastic growth! The price can obviously be further manipulated by people who will sell chickens cheaper or more expensively elsewhere.

So, what is a chicken really worth? It is worth what anyone is willing to pay for it from someone who has struck a price, regardless of whether they understand what the chicken is valued at. However, at the end of the day, every healthy chicken will lay approximately five eggs per week.

So, my shrewd business partners and I can make money three ways:

  1. Sell a chicken to someone willing to pay more for it than we did, take the difference and then buy younger chickens for less.
  2. Collect the eggs
  3. Or both!

The share market is eggsactly the same. Company share prices will fluctuate in the short term due to forces that have nothing to do with the actual underlying value of the company. Supply/demand, emotional responses to media articles and the need to just sell out at any price to free up cash will affect the share price of any company.

Regardless of share price, dividends remain the same. Dividends are paid per share, not per value of share just as, regardless of the price of a chicken, it will still provide you with the same number of eggs.

So for some, the longer term game plan is the number of chickens, not the short-term value of the chicken itself. And the more chickens you own the more eggs you will enjoy!

Financial independence can be defined as having investments that generate enough net income to satisfy your living cost requirements. For some investors it’s all about the eggs.

This article sponsored by
Jim Mills, Merit Financial Planning
Ph: 1300 827 439
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