What you should know before hiring a financial adviser

Arizona Republic, AZ

Your retirement account is down 40 percent, your home value has plummeted and the economy has left you jittery about keeping your job.

Amid all the negative news, where do you turn for help?

How about a financial adviser?

At the most basic level, financial planners help people create budgets, buy life insurance, get legal documents such as a will or trust, and invest in college funds and retirement accounts. Advisers also can manage investment portfolios and charitable giving and provide estate and tax planning.

It's an investment in your financial future that might seem extravagant in tough times. But advisers can help those of us less sophisticated in financial matters - and those who don't have time to deal with the details - to avoid expensive pitfalls. And they can be a sounding board before you make a major financial decision. Read More...

You Are About to Make a Bad Investment

Motley Fool

Don't you invest in that just because you think it's a good idea. I'm warning you.

Across 10 asset classes, over a near-40-year time horizon, and in increments of three, five, and 10 years, there's one investment vehicle that made for a total loser -- a dud.

It's gold -- that so-called safe haven for your assets -- and if you're considering it today, let me explain why you need to bypass it and move on. Although gold may well be one of your favorite items in the vault, as a long-term investment, it is just plain lousy. Read More...

Keep an open mind when investing this year

Chicago Tribune

Determining the worst and best industries to invest in this year requires keeping an open mind about what's considered bad or good.

You could, for example, employ the "bird in the hand" philosophy to select industries that have been--relatively speaking in a disastrous 2008--the most resilient and retain positive near-term prospects.

An alternative, a riskier method, is to pursue the "bird in the bush" strategy that seeks industries so far down that improvement seems likely. You just need to grab the eventual winners, a demanding task.

"The only businesses that will thrive in 2009 are pawn shops and bankruptcy firms," said John Buckingham, chief executive and chief investment officer for Al Frank Asset Management in Laguna Beach, Calif. "Having said that, however, we think the best areas for investment will be those industries and companies beaten up the most in the past year." Read More...

Good Fundamental Analysis Stock Picking Ratios

Author: NobleTrading

Fundamental analysis of the company and its stock is very important for traders and investors who have long-term profit from that stock. With the increased popularity of online trading, stock traders now have access to a whole range of fundamental analysis tools and ratios. Although traders follow different trading/investing strategies, they use two or more popular fundamental and technical analysis indicators and indices to pick tradable stocks.

Here are some important and popular fundamental analysis ratios for good stock picking.

1. Book Value per Share: Book value per share is the ratio, which is calculated by subtracting a company’s total liabilities from its total asset value and then dividing it by the total number of equity shares. Book value shows the worthiness of a company stock. The stock becomes good for trading when they drop below their book value.

2. Reserves and Ploughback: Reserve of a company is the accumulating profit of the company; and ploughback is the profit a company has after every expenses (including paying off dividends) to add to its reserve. Most growth companies are characterized by their high reserve and high ploughback. Most big and established companies spend most of their profit in paying off dividends.

3. Earnings per Share (EPS): Earnings per share ratio is derived by dividing the total profit after tax by the total number of company shares issued. This ratio is easy to find; and is extensively used by traders/investors who follow growth and value investment strategies.

4. Price to Earning (P/E) ratio: One another extensively used ratio of stock picking. Price to earning ratio gives the relationship between the current market price of a stock and its Earning per Share (EPS) ratio. Good stocks are picked by comparing P/E ratio of a stock with others in same industry or with market average.

5. Dividend Yield: Many long-term traders want to invest in stocks which yield them good dividends over time. Although, most growing companies pay small dividends in their growth phase, they tend to offer good dividends later.

6. Price/Earning to Growth (PEG) ratio: Many growth traders look for PEG ratio of stocks. Price/Earning to Growth is the comparison of a companies P/E ratio with its expected growth. This ratio gives the key information that whether the stock is over price, under priced or fully priced.

About the Author:

NobleTrading, an online discount stock broker offer flexible commission plans, personalized account representatives and sophisticated trading platforms. Their Stock Market Trading Blogs are an excellent resource for online traders.

Article Source: http://www.articlesbase.com/investing-articles/good-fundamental-analysis-stock-picking-ratios-610808.html

7 Good Reasons to Fire Your Adviser

Author: Cathy Pareto

1. You Feel Like a Little Fish in a Big Pond

Ever gotten that feeling that your Adviser could care less whether you stay with him or her? The reason may be simple; your account is too small for them now. They may have treated you like royalty when you first became a client, but now they barely return your phone calls.

This is a very common phenomenon and it's happening more and more as firms continue to get consolidated. Currently there are many investment companies, banks, and wealth management firms that are trying to divest themselves of small brokerage accounts (less than $3 million) by either centralizing many of the relationship management responsibilities or simply relinquishing the relationships. At $3 million, this is the point at which you as a client are perceived to be profitable to a large firm.So

what should you do? For starters look for a company that not only provides the services you are looking for, but is also happy to provide these services to clients with your portfolio size. Go to NAPFA (National Associations of Personal Financial Advisers)and do a search for local and national Advisers. Ask the different companies what their average, largest and smallest account size is. This will give you an indication of where you would stand as a client. Don't tell them how much you have, as they may want to skew the numbers.

2. Your Adviser Has Limited or No Credentials

Credentials and degrees are not always a guarantee of professional competence, but they are a start. Just like you would be hesitant to go to a Doctor that does not have a Medical Degree you should be hesitant of a Financial Adviser that does not have the right credentials and experience.

What Should You Look For? The highest credential in the industry for a Financial Advisers is the CFP accreditation. What this credential says is that your Adviser has studied and passed comprehensive exams on issues such as investing, insurance, estate planning, retirement planning, taxes, and other pertinent issues relating to managing wealth. This is not an easy exam to pass. It can take as long as a full year to complete all modules and become accredited. A great thing about this credential is that the Adviser is not allowed to use the CFP mark even after they have passed the comprehensive exam if they do not have at least 3 years of experience. In addition to this they also have to adhere to high ethical standards and meet continuing education requirement to keep the designation.

Click here to see the full range of requirements.So a CFP should be your minimum requirement.

There are other designations out there such as CFA and ChFC. There is certainly no shortage of acronyms in this industry. What you have to remember is not to be intimidated by the arrangement of letters behind your Adviser's name. Find out how easy or how hard it is to obtain these designations and what these mean to you. A rule of thumb is, If you can obtain the designation by passing an exam that only takes a week to study for it, you should discount it immediately. Otherwise you may end up with a salesperson, rather than a true Financial Adviser.

Aside from a CFP or other credential you should still do more due diligence.Ask any new potential Adviser hard questions about the economy, their investment style, investment philosophy, IRA rules, tax rules, etc. If they can't answer these types of questions, then it is likely that you are dealing with a salesperson that relies on the company brand. Don't be a victim of financial malpractice. Make sure your Adviser is knowledgeable by doing your homework and becoming knowledgeable yourself, preferably before you hire someone.

3. You Simply Can't Stand Your Adviser

This reason may be trivial to many, but it is more important than you think. Human interaction and personal chemistry is important. If you don't feel comfortable communicating with your Adviser you are putting your money at risk. Your Adviser is supposed to serve as your guide through this ever changing financial maze, and they need to be able to understand your overall financial picture. Equally as important, you need to be able to understand them. If you can't stand your Adviser you may be reluctant to share the details of your current financial situation which may put your money in jeopardy. Likewise, if they don't like you, they may be less likely to provide you with the level of service and attention that you deserve.

This is a bad situation to be in and should not be taken lightly. It's your money, find a competent Adviser with whom you can comfortably communicate with.

Top reasons you may dislike your Adviser:

a) You can't understand what your Adviser is saying (@#$!^*&^%!) and they don't make the effort to help you understand.

b) Your Adviser speaks over your head (it's on purpose so you don't ask too many questions they can't answer).

c) When you ask a question, your Adviser dismisses it as if it were a stupid question.

d) If you don't call him or her you never hear from them.e) Your Adviser forgets that it's your money not theirs.

4. Your Portfolio is Made up of All Proprietary Products

Want to see a completely biased portfolio? Just look at one with all proprietary funds. It always amazes me that out of thousands of available mutual funds and exchange traded funds with low expenses, investors are still buying the idea that proprietary funds are better. If you have your brokerage account at Mickey Mouse and Company and all of your investments are Mickey Mouse Large Cap, Mickey Mouse Small Cap etc., I can assure you that you are paying more than you should. Your Adviser may not tell you this but he or she is probably getting a commission by selling you these funds.

Your overall portfolio could be costing you up to 2-3% per year, but they will tell you that there is no charge for the advice. We should all know by now that nothing in life is free and no one works for free. This is 2-3% that is coming right out of your returns. If your Adviser never bothered to tell you how much your overall portfolio would cost you, it's simply dishonest. You cannot build trust on dishonesty and hidden agendas.

5. Your Portfolio Consistently Under Performs Its Appropriate Benchmark

Any investor knows that returns will vary from year to year and that this year is one of the worst years as far as performance is concerned. So when it comes to performance, you have to remember that your Adviser is not a magician. Having said this, you should expect to meet certain benchmarks. If you are invested in all US Large Cap Stocks the appropriate benchmark is the S&P500. Now let's say the S&P 500 has returned -32% year-to-date, and your portfolio is well below this benchmark at say -40% year-to-date, then you are under performing the benchmark. If your Adviser consistently under performs the appropriate benchmark, year after year, you may want to reconsider the advice you are getting.

6. You Never Know Who Your Adviser is Because There is Considerable Turnover at the Company

If there was ever a time to consider firing your Adviser this would be the time. High employee turnover means the following for you:

Bad service - The level of service if there was ever a level, will become nonexistent. You have to retain your employees to create a culture of service. If you have high turnover who is going to do the training? Beware of the revolving door.

There is something seriously wrong with the company. Make no mistake, the employees that left the company may know something you don't. All businesses go through changes but constant employee turnover is a red flag that there is something clearly wrong with the company or the management team.

Errors that will cost you money - Critical tasks related to your financial plan may be missed to your detriment. You have to build a history with your Adviser so that he or she can make informed recommendations. You will be basically starting from scratch with every new Adviser. Can you say missed or late distributions, account trading or reporting errors...the list can go on.

7. You Don't Trust Your Adviser

The final reason for firing your Adviser is that you simply don't trust them. The relationship you have with your Adviser should be one of mutual trust. Your Adviser should trust that you are providing him or her with all the details necessary to help you make better financial decisions, and you should trust that your Adviser has your best interest at heart. Once the trust is broken for any reason mentioned above, it's extremely difficult if not impossible to rebuild that trust again. It may just be time to say goodbye and start again. Hopefully you will take the lessons that you learned from your experience with you and avoid them with your next Adviser.

About the Author:

Cathy Pareto, MBA, CFP®, AIF® is the Founder and President of Cathy Pareto & Associates, Inc. a fee-only financial planning and investment management firm.

www.cathypareto.com

Blog http://cathypareto.blogspot.com/

Article Source: http://www.articlesbase.com/investing-articles/7-good-reasons-to-fire-your-adviser-607358.html

Capital Gains Tax Effect on Investment and the Economy

Author: Kahn, Szeliga

Tax revenue is a vital part of the United States government. The income generated from taxes allows the government to finance public works programs, build infrastructure and maintain a military. When the government needs to raise more revenue it generally raises the tax rate to create more income. The idea of raising taxes to raise revenue generally works; however, history has show that more revenue is not gained from the capital gains tax. When the capital gains tax rate rises there is less revenue generated, investment capital decreases, and the economy slows.

The capital gains tax is a tax charged to the profit realized from the sale of an asset that was purchased at a lower price. Capital gains are commonly realized from the sale of stocks, bonds and property. A capital gain is treated as an income and like any income, it is taxed. Under current United States tax code there are two different types of capital gains, short term and long-term gains. A short-term gain is considered to be the purchase and sale of an asset for a gain in less than one year. Long-term capital gain requires a year or more between the purchase of an asset and the sale of the asset for a gain. Short-term capital gains are taxed at the ordinary income tax level of the investor, however; long-term capital gains are taxed differently. Currently investors in the 10% to 15% income tax range pay no long term-capital gains tax and everyone else pays a 15% tax on capital gains. (Beach, Hederman & Guinevera, 2008)

Economic growth in America is important and relies on the input of two factors: input of capital and labor, and the productivity of the inputs. For the economy to grow capital and labor in the market must increase or a more efficient way to produce products is found, or both situations occur. The need to invest in capital is directly related to the growth of the economy by increasing the amount of capital available in the economy and by enhancing labor productivity. Labor productivity can be directly complemented capital in the economy for investment in more productive operations. (The Economic Effects of Capital Gains Taxation, 1997)

When capital gain tax rates raise the return on an investment is lowered and the cost to acquire capital increases. When the return on investment is lower there is less investment and the amount of available capital in the economy decreases. The inverse to an increase in the capital gains tax would be a decrease to the capital gains tax. A decrease in the capital gains tax rate is believed to stimulate investing and the amount of capital in the economy by producing more profitable and successful businesses, because they are able to acquire the funds required to under go new potential income projects. The trickledown effect would produce higher wages, raising the standard of living and create jobs. (Throning, 1995)

A recent study was conducted by DRI/McGraw-Hill it was estimated that the reducing individuals long-term capital gains taxes by 50% and corporations capital gains tax by 25% the level of business spending would have been $18 billion dollars higher than it was in 2007 creating the GDP of America to be roughly 0.4 percent higher. The conclusion of the study notes “the evidence suggests to almost all economists that a capital gains cut is good for the economy and roughly neutral for tax collections.”(Jorgenson, Dale, Yun & Kun-Young) The lower tax rate would only have positive effects on the economy such as higher standards of living, increased productivity and increased investment. A lower capital gains tax would increase individual wealth that could be re-invested or contributed to a personal savings account.

Over one hundred million Americans own stock, the majority of Americans that hold stock hold them in mutual funds. (Chait, 2008) In 2007 mutual fund holders paid over $16 billion dollars in long-term capital gains taxes. Congressman Jim Saxton, the ranking member of the Joint Economic Committee states: “…Under current law, if shareholders do nothing more than buy and hold mutual fund shares, they will be hit with taxes on long-term capital gains realized by the fund, even if they are immediately reinvested in the fund.”(Mutual Fund Shareholders Slammed Again by Higher Taxes, 2008) As stated that is capital transferred directly to the federal government rather than directly re-invested in the economy. One recent study by the National Bureau of Economic Research stated that the each dollar in federal tax increase has led to an additional $1.07 in federal spending. (Tax Increase Would Damage Economic Outlook, 2008)

The federal government requires large amounts of funds to continue operation and generally overspends, the current solution it to raise taxes to help pay for large expenses. Despite normal intuition a decrease in the capital gains tax rate has yielded higher tax revenues. Using historical evidence as proof that a lower capital gains tax increases revenue, in 1978 when the capital gains tax was lowered, tax revenue began to increase. When the tax was reduced again in 1981 tax revenue increased again drastically until 1987 when the capital gains tax increased and revenue began to decline. In 1986 the tax revenue generated from the capital gains tax at the lowest point it has been in fifty years, was over three times of that in 1977. The lower tax rate and higher tax revenue suggests that more investors are placing capital gaining on capital investments. With larger amounts of capital investments businesses are able to easily acquire working capital and continue operations. As stated earlier, more capital invested in the economy will increase the stand of living, increase income and lower unemployment. (The Economic Effects of Capital Gains Taxation, 1997)

An increase in the standard of living will allow households to purchase more good and good of higher quality. A higher standard of living allow for more money to be spent and an even larger inflow of capital into the economy. An increase in household income will allow for a larger household savings and investing rate. If households invested the extra income, there would be a snowball effect of new capital pumped into the economy. The circuitous effect of increasing capital into the economy would also result in a decrease in unemployment. Historically when unemployment is low, interest rates are higher, allowing for an increase in investor capital gains and one more stream for more capital gains tax revenue.

A reduction in the capital gains tax could counter the lock-in effect, which occurs when capital assets are not sold because the gains on capital are taxed at a high rate. When investors lock-in the tax base for the capital gains tax is lowered. Unlocking assets allows holders capital to sell holdings and achieve desired returns. It is estimated that there are billions of dollars of equity that are currently locked into assets. (The Economic Effects of Capital Gains Taxation, 1997)

When a decrease in the capital gains tax yields higher tax revenue it is time to examine the position of the tax rate on the Laffer curve. It is reasonable to assume that when the tax is high it falls on the downward side of the curve. When the tax rate falls on downward side of the Laffer curve the government is limiting the revenue it can receive. Investors are motivated to find ways to avoid paying the tax. To avoid paying capital gains tax investors could not enter into activities what will produce gains on capital such as stock ownership thus limiting the amount of capital in the economy available for companies to acquire. (Thorning, 1995)

With a very tenuous relationship between revenue from the capital gains tax rate and the level of investment based on the level of the capital gains tax rate and the effect on the entire economy it is important to look towards the future. With current capital gains tax law set to expire and rise by 2011 and a presidential election just around the corner, it is critical to know each candidates position on capital gains tax. What each candidate plans to do with the capital gains tax could have a critical effect on the economy.

On December 31, 2010, the tax rates on capital gains and dividends enacted in 2003 is set to expire. The current long-term capital gains tax rate of 15% will increase to 25%. With the tax higher a lock-in effect could occur where capital is not sold after January of 2011. Prior to the tax rate increase many investors will liquidate assets early to avoid paying the higher taxes. Senator Barack Obama said that he would not renew the current capital gains tax rate and allow the tax to increase. (Satow, 2008) Senator John McCain has stated he want to keep capital gains taxes at current rats. With the current credit crunch and many businesses unable to rise capital from banks they must turn to investors. If investors are motivated not to invest capital back into the economy because of higher taxes, many businesses will fail.

In all sectors of the economy there is a need for capital funding. Many businesses require funds to continue operation that are in turn repaid to the investor along with an incentive for taking the risk of lending money. When the capital gains tax rates are raised the incentive for taking the risk of investing is diminished. When there is a lack of investors the ability to raise capital for industries becomes limited and very expensive so new projects are not taken further limiting the amount of capital in the economy. When the taxes of investing are reduced it has been proven that there is more money into the economy and the government receives more from tax revenue.

References

Beach, W., Hederman, R., & Nell, G. (2008, Oct. 15). Economic Effects of Increasing the Tax Rates on Capital Gains and Dividends. Heritage Foundation. Retrieved Oct. 6, 2008, from http://www.heritage.org/Research/taxes/wm1891.cfm.

Chait, J. (2008, September 24). Capital Offense: How the rich rolled Barack Obama. The New Republic, pp. 5.

Jorgenson, W Dale, Yun, and Kun-Young. "2. Taxation of Income from Capital." Tax Reform and the Cost of Capital (0): 17-39.

Mutual Fund Shareholders Slammed Again by Higher Taxes: Damage would raise with Increasing Capital Gains Rate, a report of the members of the Joint Economic Committee, U.S. Congress, 110th Cong, 2nd sess. (C. Prt. 110-41). (2008)

Satow, J. (2008, July 15). Obama Capital Gains Tax Hike Would Hit N.Y. Hard. The New York Sun. Retrieved Oct. 6, 2008, from Http://www.nysun.com/business/obama-capital-gains-tax-hike-would-hit-new-your-hard.

Tax Increase Would Damage Economic Outlook, a report of the members of the Joint Economic Committee, U.S. Congress, 110th Cong, 2nd sess. (C. Prt. 110-40). (2008)

The Economic Effects of Capital Gains Taxation, a report of the members of the Joint Economic Committee, U.S. Congress, 105th Cong., 1st sess. (JEC). (1997)

Thorning, M. (1995). Trends in Investment and Tax Policy: Time For a Change?. Business Economics, 30, 23.

About the Author:

Student at West Chester University

Article Source: http://www.articlesbase.com/investing-articles/capital-gains-tax-effect-on-investment-and-the-economy-604744.html

How to Trade Commodities

Author: David Brown

The key to successful investing is developing your knowledge in the markets and to take things slowly and methodically. Commodities trading is no different. It is an exciting market which, if you are preapred to put in the time and effort, can be very lucrative, but always be aware that risks lurk in the shadows just like any other investment.

Physical Trading

Physical commodities trading is buying and selling the actual commodity itself not some sort of derivative instrument like a futures contract. There are obvious downsides to this method namely storage costs, insurance costs and shipping costs.

The physical market, for our purposes, focuses on those commodities that are easily stored, bought and traded for the average investor. These are such things as Gold, Platinum, Palladium and Silver.

The most popular method of trading such items on a retail basis is in the purchase of coins. There are many companies on the web that provide services for the purchase of coins for collectors and speculators.

The internet, of course, has given investors many options for the purchase, storage and trading of gold coins however, our favourite example of trading gold on the web is Bullion Vault. They allow the purchase and storage of gold in small quantities and have an efficient trading system. They hold $290mn of gold for clients and appear to have a very good reputation.

Leverage

If you didn't know the term 'leverage' before the current financial mess, you do now. For those who need a refresher, here is how it works. Let’s say you buy £100,000 of gold and whomever you buy it off only needs you to put down a 10% deposit, £10,000. Let’s say gold goes up 10%. You now have gold worth £110,000, if you sell it now you pay back the £90,000 you borrowed and you get your original £10k back along with your £10k profit. Basically you have turned a 10% gain in the price to a 100% gain on your investment.

Obviously if the price dropped 10% you lose your money, hence the mess that some are in at the moment.

Physical Commodities on Leverage.

There are still some companies around that provide leverage on physical commodities across a range of products, however, the costs associated with trading, such as interest on loans, storage and insurance fees have made the product less attractive to the active trader. Having filled a gap in the market for some time the product was overtaken by some of the instruments mentioned below.

ETFs (Exchange Traded Funds)

More accurately described as 'Exchange Traded Commodities' these instruments take into account all the fees such as storage etc associated with trading. They trade like shares are liquid.

An Exchange Traded Commodity is an investment vehicle that tracks the performance of an underlying commodity or basket of commodities. ETCs work on exactly the same principle as ETFs – with the ETC tracking the performance of a single underlying commodity or a group of associated commodities. Single commodity ETCs follow the spot-price of a single commodity, whilst 'index-tracking ETCs' follow the movement of a group of associated commodities, such as cattle, energy or livestock.

ETCs offer the commodities trader a number of inherent advantages without the associated vagaries of trading an individual stock:

Direct exposure to the commodities markets – the value of your investment will rise and fall in direct proportion to the price of the underlying commodity.

Liquidity - ETCs are ‘open ended’ securities, which are created and redeemed on-demand. This means that the supply of ETCs is unlimited and that price changes will accurately mirror developments in the price of the underlying commodity.

Stamp duty & CGT - ETCs are not shares and so trades are exempt from stamp duty. Furthermore, ETCs can be traded within ISA accounts, allowing you to shelter your profit from Capital Gains Tax.
Low dealing costs - ETCs are traded on the regular stock exchange, making them both accessible and affordable – they can be traded through your share dealing service for a commission.

Portfolio diversification – ETCs give broad representation across entire commodity sectors and different geographic regions.

Futures

A futures contract is an agreement to buy or sell your chosen commodity at a specific date in the future - at today’s prevailing market price. These markets are highly liquid and the contracts can be sold on again at any point before the final delivery date, i.e. the day when the farmer or miner will deliver the raw materials to the person holding the contract.

The producers and end-users are still present in today’s markets, but it is the traders and speculators who are now responsible for most of the volume that keeps the market liquid.
The main benefit of trading futures is that you are making a direct investment into the underlying raw material and your future profit or loss is entirely dependent upon fluctuations in the underlying commodity price.

Going back to leverage, most futures trading is done ‘on margin’, which dramatically increases potential profits (and losses, remember).

Shares

Exposure to the commodities market can be gained from buying and selling companies whose business it is to mine, distribute or trade in commodities that you are interested in.

The shares are, generally, liquid and accessible for trading, the problem, however, is that there are many other factors that could effect the share price that may not have anything to do with the underlying commodity. These could be management issues, cash flow, macro economic issues and geo-political issues.

CFDs and Spread betting.

CFDs and Spread betting are easily accessible trading instruments which are essentially derivatives of many of the above, however spreads and dealing costs can be harsh to investors.

Technical Phrases

You will hear such phrases as 'contango' and 'backwardation'.

Contango is a term used in the futures market to describe an upward sloping forward curve (as in the normal yield curve). One says that such a forward curve is "in contango" (or sometimes "contangoed").

Formally, it is the situation where, and the amount by which, the price of a commodity for future delivery is higher than the spot price, or a far future delivery price higher than a nearer future delivery.

Backwardation is a futures market term: the situation in which, and the amount by which, the price of a commodity for future delivery is lower than the spot price, or a far future delivery price lower than a nearer future delivery. One says that the forward curve is "in backwardation" (or sometimes: "backwardated").

Commodities trading has many aspects that set it apart from trading other markets and for those that become learned in the trading of the instruments it can be lucrative. Commodity traders over the last few years have seen huge swigs in price which have lead to large profits (and no doubt some large losses).

Currently the global market in commodities is in a state of flux. Gold, for example, is seen as a safe haven against inflation and uncertain times, hence it recent volatility.

Having worked in commodities for some years it was always noted that volatility is our friend, whether a price is going up or down there is money to be made, when commodities are flat there is not much action and the cost of trading out ways the potential profits.

For the foreseeable future volatility is definitely here to stay. Stock market issues and global recessionary fears on the one side and continued development of emerging markets using vast amounts of the world resources on the other, will see volatility in this market for many years to come. This, therefore, as a market to learn about and trade ,is a very interesting and potentially lucrative proposition.

As with all trading, however, there is a very real possibility that trading commodities, especially on leverage, could lose your portfolio a lot of money and you should be aware that it is highly risky. Do not risk more money than you can afford to lose and make sure you have a system that allows you to use limits and stops to contain this risk.

The online trading system available from HF Markets allows you to trade all of the above with assistance, if required, from a professional regulated broker who can guide your initial trading strategies and help you become familiar with trading this exciting area of investment.

About the Author:

The author has spent 20 years in the financial services industry trading everything from physical commodities to futures. Currently writes for a variety of sites including online trading sites and general market information sites.

Article Source: http://www.articlesbase.com/investing-articles/how-to-trade-commodities-596268.html

Investment Strategies for Beginners

Author: Joshua Geralds

Beginners are usually very zealous investors, but unfortunately also more often than not uninformed. This is a sad fact, because it is certainly no fun to lose all the money you have borrowed or save for the purpose of growing it. Although there is much to learn about trading Forex, getting a good grasp on the basics is very important. In fact the key to making money is in the basics and not all the advanced stuff.

For a new trader learning what works best is the single most important step to take. In Forex there are different types of tools that help us traders define and interpret the market data. In this article let’s explore the 2 most commonly used tools and their strategies.

First is Fundamental analysis, heavy weights like Warren Buffet and George Soros swear by Fundamental Analysis. Fundamental analysis is news, it is information that will sway the minds of people and cause them to behave in a certain manner. A savvy trader whop knows how to “read the wind” will know from which direction this “wind” is blowing and then trade accordingly. Fundamental Analysis helps define the trend and for all traders trading with the trend is always good as that increases your probability of a successful trade. For example if the trend is on a downtrend, you should look at your set ups to go short. Since the trend is already falling, there will be more sellers than buyers, if you become a buyer; you basically give your money away to the sellers! Unless you have a lot of money to spare my honest suggestion is sticking to trend trading regardless of the trading plans you use. A counter trend trade is always risky and frankly I would rather not lose any hair by taking such risk as the returns do not justify the actions.

The second newer tool is Technical Analysis, the fact that there are charts means that you are using technical indicators already! Technical analysis is defined as the study of past price actions to determine future movements. Pure technical analysts believe that history will repeat itself and look to the charts to show this as the case. In a way that is correct, as a trader you deal with people, and people tend to be fairly predictable if charted on a large scale. Individually humans are hard to guess, but when you start taking large groups of people and then track their actions over a long period of time you will see patterns emerge. That is what technical indicators do, they define these patterns and then based on what we know happened in the past, there is a high probability that it will happen in the future. For example, you use 2 indicators on your candlestick chart, a stochastic slow and 2 EMA lines. When the stochastic hits a oversold position and the 2 EMA lines cross upwards you go long (buy) when it is in reverse you go short (sell) Regardless of what sort of tools you decide to use, always integrate them with proper money management. For money management is the only way that will allow you to make consistent profits and grow your account steadily.

About the Author:

Dr. Joshua Geralds is a successful investment specialist with over twenty years experience increasing the income of people world wide. For a limited time get his free Money Management to a Million Dollars e-course here: http://www.pipsalot.com

Article Source: http://www.articlesbase.com/investing-articles/investment-strategies-for-beginners-596239.html

The 3 Bad Habits That Kill Your Profits When You Trade

Author: Joshua Geralds

There are many things that a trader can do wrong, but some are worse than others and can even reduce or make you lose all of your profits. Some of them are common mistakes that stand out like a sore thumb, other are silent killers. Be they glaring mistakes or silent ones, they contribute to your losses ultimately. Here are the top 3 worse habits that kill a trade:

First is the emotional trader, when ever the trade starts to turn against this trader, the emotional trader lets lose all feelings. I am not talking about weeping and wringing of hands instead this trader would be angry, hurt and scared. Should the trade lose there is a high possibility that the second trade would not follow the money management rules or the trading plan. Or if the trade goes so badly, the trader refuses to cut losses and run, instead the trader would stoically look as the trade hits the stop loss. Loyalty is all well and good, but sticking to your guns when the trade dies is a little too extreme, do that often enough and it hastens the death of your account. Every pip adds up you know.

Second is that the trader becomes too focused and forgets to diversify. This is pretty much like putting all your eggs into one basket. When that happens all it takes is one bad trade to set you back. Have a series of bad trades and you are completely wiped out. While it is good to focus your resources on the highest certainties, understand that there is no guarantee in the markets. The highest probability trade can (and often it does) turn against you at the strangest times. So many times I had a trade that was almost close to my profit target just missing a single pip, suddenly without reason the trade reverses and hits my stop loss, only to revert to where it was seconds later. Now if that was my only opened trade, that would mean that I am in a loss position. Now if I diversify my position I might lose one trade but then win the other. In that manner I break even and I have the capital to carry on trading. If things go well I win both trades (highly possible) that means I have advanced faster with safety.

Third is the lack of discipline, a lack of discipline in your trading kills your account faster than you can blink. There is so much to be said about a disciplined trader, and a trader with little discipline. A disciplined trader would ensure that the trading plan is followed closely. Entry and exit points are kept to strictly and money management rules are followed. The discipline would only allow trade to take place if all the indicators point in the right way. If there is even one just one indicator that is out, then the trade does not take place. Discipline in your trading will separate a profitable trader from a trader who is in danger of having an account wipe. Discipline in money management gives an advantage to the trader by ensuring the account is grown steadily and consistently. The key to making money in Forex is not large gains, but instead it is the small consistent wins per trade that finally build up. Imagine a stream, the stream flows down the side of the mountain, and soon it is joined by other streams, then they form a huge river, which rushes out to sea. This is what discipline trading will give to you. Your consistent profits will be like little streams that finally become a huge flood of money!

About the Author:

Dr. Joshua Geralds is a successful investment specialist with over twenty years experience increasing the income of people world wide. For a limited time get his free Money Management to a Million Dollars e-course here: http://www.pipsalot.com

Article Source: http://www.articlesbase.com/investing-articles/the-3-bad-habits-that-kill-your-profits-when-you-trade-596236.html

Do you rent your home? It could be in foreclosure

KVBC, NV

If you rent a home, it may be a good time to do a little investigating. Many renters in the Las Vegas Valley are learning that the homes they've been paying to live in are in foreclosure or have already been sold - and in some cases, with little time to find a new place to live.

Two days before Christmas, your mind is on gifts and spending time with your loved ones. But one local family received a rude awakening on December 23, when they learned that the home they'd been renting for about three years had gone into foreclosure six months before.

The Shaners, a family of six, thought a knock on their door was a deliveryman with a holiday package. However, it turned out to be their first notice that their home had been sold. Now, the Shaners face an uncertain future. Read More...

The 3 Investing Rules of a Billionaire Family

Motley Fool

During the second half of the 20th century, Larry Tisch and his brother, Bob, turned an investment in a New Jersey resort hotel into a multibillion-dollar conglomerate -- Loews (NYSE: L). How did they do it?

Larry, the financial mastermind, had a knack for spotting value. In 1960, the brothers took control of Loews, at that time a major movie-theater chain. But they were less interested in the movie theaters themselves, and more enticed by the real estate on which those theaters stood.

Loews is now a $10 billion company comprising insurance, hotels, and offshore oil and gas. Larry's son, James Tisch, the current CEO, recently reflected on the guiding principles on which Loews was built. Read More...

How Safe are Municipal Bonds

Author: Matthew Faery

If you're an investor that is leery about the state of the economy and the mass of credit issues facing companies then you probably are not sure where to safely put your hard earned money. One conservative yet still liquid option is to invest in Municipal Bonds (Munis) which offer a high rate of interest and principal payments received from the issuer. Munis are bonds issued by public entities below the state level in order to raise money to build and/or make improvements.

For the most part Munis are exempt from Federal Taxes and in many areas, local/state taxes as well. This is where research comes in because there are a group of taxable Munis. These often offer a higher rate of return but with taxes taken you're usually better off taking a lower yield tax exempt bond. Good websites for researching Munis and their rates are investingbonds.com and bondsonline.com

Munis are also liquid which means your money is not trapped and you can cash out of them at any time. Make sure you pay attention to the yield of the bond because if you have to sell it prior to maturity you will get the current yield rate and NOT the maturity yield. The minimum investment for most Munis is five grand, so it's affordable to most investors that want to enjoy the conservative approach while receiving predictable and steady payments from their bond investment.

One other great option of Munis is that you can sell your bonds prior to maturity in the over-the-counter market. This is especially advantages if the price of your bond has grown substantially and you can make more out of selling it in the open market than you can make from keeping it through maturity. Besides looking at tax exempt status another important issue to look for from companies that offer Munis is to make sure they have a BBB rating or better. The higher the rating the more reassuring it will be that the company will be able to pay you the principal/interest that they promised. Also remember that the highest yields are not always the best. A good rule of thumb is the higher the yield for Munis the more risk you take of the company not being able to payoff the principle/interest.

One more way to make your investment safe is to purchase Insured Municipal Bonds whereas the insurance company will pay you the principal and interest owed in the rare cases where the Muni company defaults. There is no absolute safe haven for investments. If you're looking for a very reliable investment with nice steady interest payments then I suggest looking into investing in Municipal Bonds. From my experience they offer one of the safest investment vehicles for conservative and economy leery investors. It sure beats stuffing your money under the mattress and letting it devalue over time.

About the Author:

Matthew Faery is the Senior Editor and Researcher for Crusader Investing LLC.

http://www.crusaderinvesting.com

http://www.crusaderinvesting.blogspot.com

Article Source: http://www.articlesbase.com/investing-articles/how-safe-are-municipal-bonds-594904.html

Financiers suggest works worthy of investment

Atlanta Journal Constitution

The stock market has taken investors on a wild ride in 2008, confounding experts and amateurs alike, and the economy has seen its biggest turmoil in decades.

It’s enough to send anyone to the couch with a good book containing wisdom about such matters, assuming they haven’t suffered losses so devastating they just want to turn their back on all things financial.

The Associated Press asked a handful of accomplished money managers and other financial experts for their recommendations for essential reading. Here’s what they came up with, along with their comments:

“Your Money and Your Brain,” by Jason Zweig; Simon and Schuster; 2008. Recommended by Harin de Silva, president of Analytic Investors Inc. in Los Angeles. Read More...

History of Hedgefunds

Author: Redalkemi

In 1949, Alfred Winslow Jones devised and implemented an investment strategy that would forever brand him as "the father of the hedge fund industry." While working for Fortune Magazine and investigating financial strategies, Jones decided to launch his own fund and raised a total of $100,000, $40,000 of which was his own money.

Jones employed two strategies still used heavily by hedge fund managers today: Leverage and short-selling. To avoid requirements set in place by the Investment Act of 1940, Jones limited the number of investors to 99 and set up the fund as a limited partnership.

Even though Jones garnered sizable returns in his first few years heading the fund, his strategy did not come into the mainstream until the late 60’s. When George Soros and Warren Buffet adopted Jones’ strategy and launched their own funds, hedge funds were suddenly being sought after by an elite group of investors.

What caught the attention of the investors was how these hedge funds had little correlation to the market. They were "hedged" against any downtown or slump in the economy. While the S & P was lagging, Jones’ investors continued to make money on a yearly basis. He decided to charge his clients a 20% performance fee, still used today by hedge fund managers. However, while most managers today also charge a management fee (usually 1-2%), Jones did not charge his investors anything unless the fund made a profit.

Hedge funds still enjoy limited regulation and are not required to make periodic reports with the SEC under the Securities and Exchange Act of 1934. Because of this, hedge funds have much more limited transparency than do mutual funds. While there have been recent attempts by the SEC to tighten up hedge fund regulation, they still enjoy the freedom and secrecy that other investment vehicles do not.

The SEC warns, "You should also be aware that, while the SEC may conduct examinations of any hedge fund manager that is registered as an investment adviser under the Investment Advisers Act, the SEC and other securities regulators generally have limited ability to check routinely on hedge fund activities."

The one thing they do have control over, however, is who may invest in these hedge funds. The SEC mandates that only accredited investors or qualified clients may participate in hedge funds, due to the higher risk involved. However, the typical hedge fund investor is thought to be well educated when it comes to funds, and risks are usually communicated by the hedge fund manager.

In addition, in order to keep hedge funds "private" and in compliance with the Securities Act of 1933, soliciting or marketing is strictly limited. While hedge funds may have a website, only approved, qualified investors may access the site after their net worth is confirmed.

Today, there are over 10,000 hedge funds in existence with close to $3 trillion in assets under management. While some of them still use the staple strategy of leverage and short-selling, hedge funds today employ hundreds of different strategies, and not all all of them are "hedged," as Jones’ was. Still, his business model that successfully dodged U.S regulation and his innovative investment strategy were the basis for the hedge fund industry today.

About the Author:

Articles by HedgeCo Networks 400 Clematis St. #205, West Palm Beach, FL 33401 For more articles and relevant hedge fund information please visit HedgeCo.Net

Article Source: http://www.articlesbase.com/investing-articles/history-of-hedgefunds-592789.html

What is Capital Growth Investment Strategy?

Author: NobleTrading

Capital growth investment strategy is a widely accepted and followed portfolio management strategy. As the name suggest, the strategy aims at capital growth, maximizing portfolio value, over time. Before we start, here is the danger signal – capital growth strategy is a high risk investment strategy which requires great investment discipline and money management.

A portfolio which follows capital growth strategy is mainly comprises of equities. Often more than 60 to 70 percent capital is invested in stocks, preferably growth stocks. Remaining portfolio can be constituted of low profit low risk investments such as fixed income securities, money market funds, cash, and/or precious metals like gold to limit overall portfolio risk. The exact portfolio capital allocation depends on many things like individual profit goals, risk tolerance, risk capital involved, portfolio size and investing experience.

Many times one can see capital growth portfolios which allocate more than 90 percent capital to equities. Capital growth investors often prefer small and mid cap stocks over large cap stocks, because these show greater growth and are expected to offer increased return over time. Diversification of portfolio is important in capital growth strategy and is achieved by investing in different products like stocks, options, futures, ETFs, funds, bonds, etc. Portfolios which allocate most (all) of the capital to equities achieve diversification by investing in different industry stocks, different markets, using derivatives to hedge risks, and by investing in both high growth high risk stocks and low profit low risk stocks.

Capital growth investment strategy is a long-term strategy, which may or may not require periodical reassessments and rearrangements of portfolio allocations. Investable stocks are found using various growth investing tools and strategies. Active portfolio management is recommended for experience investors, to replace low performing investments with high performing ones. But remember, active management often requires greater costs.

The advantages of capital growth investment strategy involve faster increase in asset value and better chance of profit than most other investment strategies. The disadvantages include higher risk, unpredictable returns and high volatile portfolio. With capital growth strategy, market entry and exit timings are very important; and there are too many market, risk and economical factors to be considered. The silver lining is ‘irrespective of frequent ups and downs, the equity market shows almost steady growth in long-term; which is higher than most other financial markets’.

About the Author:

NobleTrading is an online stock trading broker offering flexible commission charges and direct access to all major markets, also including OTCBB and Pink Sheet markets. NobleTrading’s daily updated stock trading blog deals with major trading strategies, indicators and terms.

Article Source: http://www.articlesbase.com/investing-articles/what-is-capital-growth-investment-strategy-590326.html

The 6 Keys to Start and Become a Great Investor

Author: Andy

Being a successful investor is not as difficult as most people may think. Making a successful investment is highly dependent on know how the market works and understanding it. Think of it as throwing a boomerang. In order for you to throw the boomerang and make it turn back towards you, you need to know which direction the wind is blowing.

Just like in investing, you need to know which direction the market is headed. This way, when the market direction changes; you can change with it.

The key thing to note is that the market is led and influenced by people. Thus, in order to understand the market, you need to understand human nature. And that is what we call the psychology of great investing.

Since 1920s, investors today still operate from the same set of emotions that investors of the past did. They all invest with hope, fear and greed. It is extremely difficult for human nature to change. And as long as it remains unchanged, market will behave like the way they did and keep repeating itself.

Here are some keys for you if you want to enhance your psychology and become a better and greater investor.

Investing On Paper

To hone your market knowledge, practise by putting investments decisions on paper first. During this period, get to know your personal investment style which is linked to your personality and lifestyle. This is one of the processes to building a strong mental state of investing.

Money Management

Money management is by far the most important factor of trading success. I cannot emphasise the importance of it. The principles behind of an investment plan are to manage your losses and gains and to preserve your capital so that you can stay in the game. Trading is a survival game. Do not ignore money management or you will regret.

Keep a Trading Diary

Whether it is on paper or digitally, just keep one. Record all your daily, weekly and monthly trades, opening and closing balances. You will be surprised how much you can learn if you put an honest effort into a personal trading journal.

Review and find your personal investing style

Each successful investor has a unique style of investing. There are many great investors in the world including Warren Buffet, George Soros, Jim Rogers and many more. But they do not invest in the same style because there is no fixed style.

Constantly acquiring Market Information

Savvy investors need to be current on market sentiment because analysts, chain of events continue to influence the institutions and move markets. Enhance your own research by acquiring market knowledge.

Knowing the Market

Finally, when it comes to investing, the market never changes because human psychology does not change. Hope, fear and greed will always be the main driving force of the markets. However, the fact that the market never changes is the key to investing success if only you are willing to do your homework.

By studying the past and learning to interpret the market, you will be able to recognise possible and predictable trends. This ability will be critical to capitalising on opportunities and protecting your gains.

While changes in market trends take place over time, a focus on its daily actions can help you understand the overall picture better.

I encourage every one of you to start investing early. The fact is that whether you want to retire at 35, 55 or 65 years old, you need money. To live relatively comfortable, you have to be realistic of how much you will need. And you need to start investing your money early so that they will start working for you earlier and keep growing until your retirement.
For every year you delay in investing, you need to save more of your earnings or income for retirement. That means lesser space for your wallet or pocket to breath.

Start investing today and if you are really serious about investing, you have to give it your best shot!

Besides investing in stocks, options trading is another instrument that you may want to consider.

If you are in search for a powerful options strategy to add into your arsenal, then I recommend you my book, Huge Profits Options Trading with Simple Analysis.

This is a no nonsense or textbook strategy book. All the information presented in this book is about sharing with you how to study the market, when to enter and when to exit and take profits. Whether you are into stocks or stock options trading, this book is for you..

Go to my website, www.BuyLowSellHighTips.com to witness this extraordinary stock options trading ebook.

About the Author:

Article Source: http://www.articlesbase.com/investing-articles/the-6-keys-to-start-and-become-a-great-investor-587291.html

Average investors are fleeing fastest

Minneapolis Star Tribune, MN

Record amounts are flowing out of stock funds while investing in money market mutual funds has increased.

The bubble pops. Stock markets tumble. Investors flee.

It is the narrative of nearly every economic boom and bust, as investors scramble to find other places -- besides underneath mattresses -- to park their money.

Investors pulled $10.5 billion out of stock funds in the week ended Dec. 10, up from $3.3 billion the previous week, according to the Investment Company Institute (ICI), a trade group for mutual fund managers. A record $72 billion flowed out of stock funds in October, according to the ICI's most recent monthly data. Read More...

Steps to Starting Investing Young

Author: Chris Sandberg

I am often asked about beginner investing, and I really think that investing should begin in childhood. As soon as a child is old enough to spend, they are old enough to invest. If you were not fortunate enough to have parents who share my view on this, you will have "re-parent" yourself into good investing habits, at whatever age you have reached now.

The first step with investing is to have something to invest. This might seem so obvious as to be not worth mentioning, but actually, it is more common than you might think for me to encounter someone with maxed-out credit cards, multiple personal loans, and a car payment, asking me how they can get into investing.

In order to have something to invest, you income must exceed your expenses. The difference between your income and your expenses is the only money you can truly say that you have "earned". Everything else may have passed through your hands, but if it didn't stick, it has no future value for you.

If you want to get into beginner investing, the first step is to apply your surplus - the income you don't spend on expenses - to reducing your debts. The only debts you want to have as an investor are investment debts - mortgages on investment properties, for example. Pay off the credit cards, and cut them up!

Once you have eliminated your consumer debt, your next step is to accumulate your "safety blanket" money. This money should be kept in a high-interest savings account, which you can access with immediate or 24-hour access. The purpose of this money is to allow you to relax and feel that you have the expenses covered, should the worst happen and you lose your main sources of income.

The amount of this money will vary from person to person. At a minimum, it should be three months of the outgoings required to maintain your current lifestyle. Ideally, it should be 12 months. Once you reach the three-month amount, you can start on other investment strategies, but keep adding to your safety blanket regularly until it reaches the 12-month goal.

Once you have reduced your expenditure, paid off your debts, and saved up a safety blanket, you are ready to start accumulating your investment nest egg.

Depending on your age and risk profile, you will do different things with this money. If you are young and reckless, you can afford to experiment with highly volatile investments like junk bonds, small cap shares, options, commodities, and foreign exchange. IF you are older, or more cautious, save those investments for a tiny fraction of your portfolio, and put the bulk of your money in blue chip shares, AAA rated bonds, and high-quality real estate investments.

About the Author:

Chris is a writer for http://getrichinvesting.com, where he gives investing tips and advice to help readers find the best way to invest money.

Article Source: http://www.articlesbase.com/investing-articles/steps-to-starting-investing-young-583217.html

Senators call for investment

Fremont News Messenger, OH

WASHINGTON, D.C. -- As Congress and the Obama administration craft an economic recovery package, a group of U.S. Senators today called for major investment in water and sewer infrastructure projects.

In a letter to congressional leadership, U.S. Senators Sherrod Brown (D-OH), Debbie Stabenow (D-MI), Robert P. Casey (D-PA), and Claire McCaskill (D-MO) this week outlined how federal water and sewer infrastructure investment can create new jobs and economic development while responding to critical public health and safety needs. Read More...

The Behavior Of Share Market And Ways To Predict It

Author: Tarun Jaswani

From experience we know that investors may temporarily pull financial prices away from their long term trend level. Over-reactions may occur so that excessive optimism (euphoria) may drive prices unduly high or excessive pessimism may drive prices unduly low. New theoretical and empirical arguments have been put forward against the notion that financial markets are efficient.

According to the efficient market hypothesis (EMH), only changes in fundamental factors, such as profits or dividends, ought to affect share prices. (But this largely theoretic academic viewpoint also predicts that little or no trading should take place contrary to fact since prices are already at or near equilibrium, having priced in all public knowledge.) But the efficient-market hypothesis is sorely tested by such events as the stock market crash in 1987, when the Dow Jones index plummeted 22.6 percent the largest-ever one-day fall in the United States. This event demonstrated that share prices can fall dramatically even though, to this day, it is impossible to fix a definite cause: a thorough search failed to detect any specific or unexpected development that might account for the crash.

It also seems to be the case more generally that many price movements are not occasioned by new information; a study of the fifty largest one-day share price movements in the United States in the post-war period confirms this.[3] Moreover, while the EMH predicts that all price movement (in the absence of change in fundamental information) is random (i.e., non-trending), many studies have shown a marked tendency for the stock market to trend over time periods of weeks or longer.

Various explanations for large price movements have been promulgated. For instance, some research has shown that changes in estimated risk, and the use of certain strategies, such as stop-loss limits and Value at Risk limits, theoretically could cause financial markets to overreact.

Other research has shown that psychological factors may result in exaggerated stock price movements. Psychological research has demonstrated that people are predisposed to 'seeing' patterns, and often will perceive a pattern in what is, in fact, just noise. (Something like seeing familiar shapes in clouds or ink blots.) In the present context this means that a succession of good news items about a company may lead investors to overreact positively (unjustifiably driving the price up). A period of good returns also boosts the investor's self-confidence, reducing his (psychological) risk threshold.[4]

Another phenomenon also from psychology that works against an objective assessment is group thinking. As social animals, it is not easy to stick to an opinion that differs markedly from that of a majority of the group. An example with which one may be familiar is the reluctance to enter a restaurant that is empty; people generally prefer to have their opinion validated by those of others in the group.

In one paper the authors draw an analogy with gambling.[5] In normal times the market behaves like a game of roulette; the probabilities are known and largely independent of the investment decisions of the different players. In times of market stress, however, the game becomes more like poker (herding behavior takes over). The players now must give heavy weight to the psychology of other investors and how they are likely to react psychologically.

The stock market, as any other business, is quite unforgiving of amateurs. Inexperienced investors rarely get the assistance and support they need. In the period running up to the recent Nasdaq crash, less than 1 per cent of the analyst's recommendations had been to sell (and even during the 2000 - 2002 crash, the average did not rise above 5%). The media amplified the general euphoria, with reports of rapidly rising share prices and the notion that large sums of money could be quickly earned in the so-called new economy stock market. (And later amplified the gloom which descended during the 2000 - 2002 crash, so that by summer of 2002, predictions of a DOW average below 5000 were quite common.)

About the Author:

Get Top Shares Tips and share market tips that work.

Article Source: http://www.articlesbase.com/investing-articles/the-behavior-of-share-market-and-ways-to-predict-it-582898.html

Guidelines for Buying Land

Author: Dave Simpson

Like a house, buying land can be a very stressful business, unless you follow certain guidelines. I aim, in this short article, to give you some tips to make the whole experience of buying land as smooth as possible.

First of all, know your budget and stick to it. Many people get themselves into serious financial problems when they buy land that is overpriced, or simply more than they can afford. You should also consider the reason for buying the land, for you may be able to pay more for land that is for investment purposes than for say, your retirement. Longer term investment in land can also affect your budget, especially if you are buying the land under a finance deal.

Another factor to consider is what is the potential future value of the land you are considering purchasing? If you are buying for retirement purposes or to build a house to live in then you probably want to buy land that is already zoned and has suitable infrastructure already in place. If you are a speculator then it may be worth checking what the future land use proposals are for you could be picking up a bargain. Always check with your local Zoning office before buying land, this can prevent nasty shocks in the future. You don't want to end up living next to a slaughterhouse or freeway!

Its a little different when it comes to land investment. If you are speculating then it may well be worth taking extra risks and buying discounted land to sell when people decide to come and settle there. Always consider local amenities and natural features such as a Lake Front, Lake View, or nearby gold course as these always attract a premium price when developed.

Finally, ensure that the deal is legitimate. Perform due diligence, get a lawyer involved if the deal warrants it and ensure that you get, for example a Warranty Deed, or a similar document to prove that you actually own the land, and of course you should ensure that the person selling you the land actually owns it in the first place!

About the Author:

If you are looking for land to buy then you should check out my website at http://www.uslandauctions.info where you will find a wide range of land for sale in every state in the US.

Article Source: http://www.articlesbase.com/investing-articles/guidelines-for-buying-land-574718.html

What Do You Know About Bonds?

Author: Uchenna Ani-Okoye

A bank or establishment will give you bonds in exchange for you lending them cash; they issue bonds that promise to compensate yourself back in the time to come including interest.

Bonds are they gamble free?

A bond has low gamble elements but it is not gamble free. If you buy corporate bonds, this means that you are buying a claim to their assets. Just like conventional persons big corporations tend to take on debt, which must be paid back, they take on debt in a trust to grow. It is possible for them to take on too much debt which they are not able to pay the loan back. Just like a conventional person being not able to make their credit payments. If a company was to file for bankruptcy they would be unable to to payoff the bonds that you bought from them. This means that the investor, which is yourself can on paper lose the bonds that you invested in them, as luck would have it bonds are not normally lost this way.

If you invest in bonds, they can be sold to the market at any time. Similar to stock bonds they have an assigned price driven by the market. If you choose to sell it on the open market, you should keep in mind that people will enquire to know the rate of interest the bonds pay out and the rate the market values it at. For example, if you own a bond paying five percent interest and you want to sell it when the interest has expended up to 9% you're going to get a lower cost than what you paid. A person could at ease get a new bond, instead of your bond.

The different varieties of bonds

Municipal Bonds: - Municipal bonds are also known as 'minis'. They signify the bonds, which have been issued by municipal corporations. Municipal bonds allow the holder to claim tax exemption.

Corporate Bonds: - Big corporate companies float such bonds. These bonds carry rather a higher gamble element no matter how big the corporate company is.

Government Bonds: - If a regime authority wants to raise cash they broadly issues regime bonds. These are generally gamble free in nature and will provide the owner with tax exemptions.

Saving Bonds: - The regime will also issues savings bonds, a huge vantage of these bonds is that you can get tax exemptions by investing in these bonds, features of mutual bonds, always important to see the features of the specific bond you may want to invest in. factors to study are Maturity period, purchase cost and fiscal constraints also deciding factors, these should all be interpreted into account when investing in mutual bonds.

In conclusion

Bonds are excellent over looked investment acknowledging the low gamble bonds have it is amazing how many people have little to no information about them. Bonds require very simply understanding; you buy them and sell them if you want to. They key to investing in bonds is to set a time frame for how long you intend to keep the bonds. Bonds are ordinarily a long term investment. When investing in corporate bonds, always read up on their current bond rating. A bond evaluation is a letter grade assigned to each bond to tell investors how high-risk it is. Don't deal with "junk" bonds.

About the Author:

Uchenna Ani-Okoye is an internet marketing advisor and co founder of Free Affiliate Programs

For more information and resource links on bonds visit: Savings Bonds

Article Source: http://www.articlesbase.com/investing-articles/what-do-you-know-about-bonds-573308.html

Few Tips for Debt Recovery to Relieve Your Worries

Author: max smith

The majority business faces problems with customers who are unwilling to pay. Recovery of debt poses a huge problem in such situations. Customers or debtors, who are fed up with your collection calls try to ignore it or in other sense, they are virtually disappeared in nominal cases.

In the scenario of global business debt collection services could be turn out to be a major concern. Interactive systems and practical debt recovery solutions will professionally handle and recover debts in real time. When you want to initiate with a collection agency these are the various measures debt recovery might not be concern. The measures being are:

1. • Billing quickly and efficiently

2. • Personal reminders to customers

3. • Ensuring feedback from customers

The adverse effects of debt recovery on the customer’s worthiness might help in debt recovery in real time. Despite many reminders or warning if the debtors do not pay back the company then it must resort to a debt recovery agency.

How does a debt recovery agency recover debts?

1st STEP -Through collection letters: The debt recovery process initiates with dispatch of collection letters to remind your customers. Generally, collection letters serve the purpose well.

2nd Step - Solicitors letter: Through a solicitors letter the debtor is given a 7 day legal warning. If not adhered to, it would result in legal action against the debtor to recover outstanding debts.

3rd Step- Legal Action: if the debtor does not adhere to any of the above means 1st and 2nd then, debt recovery agency will assist you in legal action against the debtor.

What are the benefits of Debt Recovery?

1. Your business plans saves your time and money, which you can use to enhance your business.

2. Get better cash flow and value of your business and your organization

3. Tracking the progress of debt recovery of your various customers and plan accordingly

National Assets Management and debt recovery services have proven to be a cost effective and efficient means to recover bad debts. Up-to-date details on individual cases, guide you on the various options available as a documentation format, provide information, and support when your claim is disputed in no time.

For a great resource to select best collection services needs go to: Debt Recovery Services

About the Author:

Max Smith writes regularly about finance & collection services related topics. I hope you enjoy this article.

Article Source: http://www.articlesbase.com/investing-articles/few-tips-for-debt-recovery-to-relieve-your-worries-570037.html

7 Simple and Easy Steps to Big Time Real Estate Investing Success

Author: Sean Flanagan

Too many real estate investors fail to achieve their dreams because they fail to properly launch their investing careers or because they reach a crossroads and don't know which way to turn. Confused about the next step to take, they spin their wheels, do nothing, and eventually opt to walk away from real estate completely and go back to a life of mediocrity. To prevent this from happening to you, follow this simple seven step roadmap to success.

Step One: Education – The right education is critical to your success. Before getting started you should begin learning about a variety of creative techniques. You don’t want to spend so much time preparing to invest that you never launch your investing career, but you don’t want to go off half-cocked and fire at everything that moves either. Learn enough to be able to write an intelligent offer and then make it happen. As your career advances, continue learning as you go along. There’s a ton of accumulated investing knowledge available, so take advantage of it. Keep in mind, too, that education doesn’t have to be a $2,000-$3,000 guru-sponsored super course. You can sometimes learn more from a $20 book, but never quit learning or you will quit growing.

Step Two: Planning – What steps are you taking to reach your goals? Are you sitting around with a pad of paper and a pen planning how you’ll spend your real estate profits or are you taking a series of deliberate steps to all but guarantee your success? How many calls are you going to make today, this week, or this month? How many properties will you look at? How many offers will you write? Real estate is a numbers game, so you need to plan your numbers and then you need to follow up by analyzing your activity. If you don’t keep score you won’t know if you’re winning or losing. It all starts with a plan and ends in the winner’s circle or the employment office. Planning – or failing to plan – will determine where you’ll be in a year and how much money you’ll have.

Step Three: Team Building – Major league ball teams don’t wait until the season starts to begin looking for members of their team. Their team-building effort starts months ahead of opening day. As a real estate investor you need a team of professionals in your corner. Start today with a small title or escrow company and a mortgage company. Make sure they understand creative real estate and have experience. If you’re not working with a mentor familiar with creative investing, you need to find one. He or she can shave years off your learning curve by helping you to avoid some of the stupid and costly mistakes they made.

Step Four: Circle of Influence – Who are you listening to? Your brother whose idea of creative real estate investing is buying a time share in Arkansas? If your circle of influence – people who give you advice – don’t know and understand real estate investing, they’ll constantly be taking aim on your hopes and dreams because they don’t understand the concept or because they don’t want your success to shine a spotlight on their mediocrity. Tap into as many creative – and successful – real estate investors as you can at your local REIA meetings.

Step Five: The Right Sellers – Wasting time trying to browbeat somebody into accepting your creative offer is unproductive and demoralizing. Make sure that the sellers you’re dealing with are highly motivated to sell and good things will happen. Don’t be afraid to walk away from the wrong deal even if the price is right. Know your ideal situation and then capitalize on it when the opportunity presents itself.

Step Six: Hobby/Business? – Is real estate investing going to be your pathway to prosperity? While there are plenty of opportunities for you to have fun, never lose sight of the fact that you’re playing in a very competitive sandbox. You have something going for you, though. A lot of investors lack the education, training, and mindset to prosper. If you’re one of them, you should save your money and take up stamp collecting or join the rock club. If, however, you’re serious about success and give this business the effort it deserves, your future is a blank check – and you’re holding the pen.

Step Seven: Stick with It – Real estate investing success won’t necessarily come overnight. That’s not to say that you won’t become an overnight sensation, but be prepared for the possibility that it might take 3-5 years to achieve a level of success that inspires you to throw all of your time and energy into enriching yourself. Real estate investing is easy, but it’s not simple. It takes work, effort, and a willingness to keep plodding ahead even when your big payday is years away – instead of mere days.

By following this seven step action plan you can set your sights on reaching all of your personal and financial dreams. Real estate investing is one of the most lucrative careers in the world, but you’ll have to dedicate yourself to your success. How bad do you want it?

Now go get it!

About the Author:

Sean Flanagan went from dead broke, living off Ramen Noodles and selling used pallets from the roadside for $20 a day, to a self made real estate multimillionaire in under 2 years time. He now shares his secrets with thousands of students across the country.

He has a FREE audio course titled 7 Secrets to Making Big Bucks in a Slow Real Estate Market which you can get right now by quickly visiting www.YuckyHouseSystems.com. He also gives away a coaching program for new real estate investors where he offers a risk free trial to prove to new real estate investors how much money they can make with his program at www.YuckyHouseSystems.com.

Article Source: http://www.articlesbase.com/investing-articles/7-simple-and-easy-steps-to-big-time-real-estate-investing-success-569492.html