The lure of freedom checks has drawn in many, but a few still stand skeptically to the side. This skepticism has nothing to with the somewhat scammy nature of Matt Badiali’s freedom checks videos. Yes, they do smell a little schemey, but that is primarily because the videos use the same scrip as their predecessors. Most shy away from freedom checks because they have no real understanding as to what they are. Matt Badiali holds up a fat check and says you can have one just like it. Okay, but what is that check in the first place?
Matt Badiali is an investment guru, a master of the natural resource market. He works for Banyan Hill Publishing, and what he does is find investment opportunities and then tell people about them. The investment opportunity he coined as freedom checks are return of capital payments. This is what an investor receives for purchasing a stake in a natural resource company. Much like stock investing in a stake profits both sides.
The investor gets a percentage that entitles them to a future payout, and the company gets a source of capital it can use to fund its exploits. The type of stake Badiali is offering is known as an MLP. MLP stands for master limited partnerships and many companies use them because of the benefits they offer. First off, these companies are not publicly traded entities. By offering MLP stakes they can operate as if they were publicly traded companies. This means an increase in capital, and the ability to take advantage of significant tax advantages. However, to gain the tax advantage, they must dispense 90% of their revenue to stakeholders.
So that is mystery behind freedom checks. They are a monthly to quarterly payout from a natural resource company to stakeholders, who purchase stakes within the company, so it can act like a public entity. Since the company must allocate 90% of revenue to their stakeholders, whomever has a percentage gets a regular payout. This is the investment Badiali is offering.