Is There a Future in Gold?

by: admin - January 27th, 2012   Filed under: Investing in Gold Add Comment

Gold, everyone is talking about it and wondering whether or not they should enter the market. There is no doubt that gold has proven extremely popular over the last few years, and that popularity is continuing. Gold became sought after following the collapse of the financial markets in the late 2000s, as it led to security from the failing financial institutions. As all commodities grew in popularity, so did their price, and gold prices rose to unprecedented levels. With gold currently trading at around $1700 per troy ounce, is it realistic to expect success in future? Or will gold face a fall in price as people move to other investments?

A Positive Future

Some commentators believe that we haven’t seen the peak in gold prices yet, and investors should still consider gold as a viable option. With the economy faltering, and investors and governments not sure over how to deal with the various financial issues that are in the offing, gold is a strong security. If the Western countries end up in a situation where, for example, the Eurozone collapses, and economies fall into a double dip recession, then gold will retain its importance. As investors will need to continue their push into gold the price will rise and they will continue to buy gold. If this happens then gold has a strong future, and investing now should be a priority. Even though you are probably kicking yourself for not buying gold in 2007, making any profit now should not be missed. You could still potentially make large profits.

A Negative Future

Conversely some commentators are claiming that gold has seen its hey day, and a collapse is just around the corner. If the global economy recovers to a situation where investment markets are clearly making profits, then this may be the case. Although it is still unlikely that this will happen within in the next two years. When the global economy does recover, the gold prices will certainly tumble. A similar occurrence happened in the mid 1970s where gold price almost doubled, only to fall back to a price of around $400 per troy ounce, a price that stayed stable until 2006. At some point gold prices will fall, but it is directly linked to how the economy performs. The point at which you see a plateau and gold prices do not seem to be rising at all is hard to point out, and as these commentators would like you think, the gold markets could collapse tomorrow, although it is extremely unlikely.

Potential

Picking the moment to step away from gold will be extremely hard, and only the top investors will be able to set the trend. There is no doubt that gold will retain a high price for the foreseeable future as economies recover, but the future could be even brighter for gold investors if economies falter once more. For short term investors gold may seem an unreliable idea, and if gold prices continue to float around $1700 per troy ounce. If economies falter, and there are major concerns that this may happen, then gold certainly has a future, and a profitable one.

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Real Estate Investment

by: admin - December 15th, 2011   Filed under: Investment Tips, Real Estate Investments Add Comment

Real estate investment can be a safer way to make money than investing in the stock market. During an economic downturn when property values and interest rates are both at record lows, real estate investment can also be a great way to take advantage of a market where you can find great bargains. Of course, real estate investment is not without risk, so you need to make sure you are prepared and understand what you are getting into.

There are a few reasons why real estate investment is largely considered to be a safer investment than other types of investments such as stocks. For one thing, real estate is a tangible asset that is unlikely to ever be worth nothing. It has actual value in terms of both the land and the materials that were used to build the property.

While stocks have value, it is possible for them to go to zero if a company goes bankrupt, if a company suffers great losses, or if the company was reporting incorrect financial information to the public. In other words, there are certain risks in stocks based both on the way the market works and on the different nature of the investments that causes them to have additional risks as compared to real estate.

In real estate, it is also possible to insure against anything that could cause a total loss. For instance, you can buy fire insurance or flood insurance or tornado insurance. You cannot buy insurance against your investment in a stock going bankrupt. Once again, this means that you can more fully protect yourself in real estate.

One of the clearest examples of evidence that real estate is less risky than stocks comes from the fact that banks allow you to borrow money to invest in it. If you went to a bank and asked the bank to give you money to buy stocks, or even to buy bonds or mutual funds, the bank is not going to give you a loan for those express purposes because the bank recognizes that there is too great a chance of loss. The bank will, however, lend you money to buy a home or an investment property because the bank knows that the asset is always going to have some value to guarantee the loan.

The fact that the bank lends you the money also gives you more leverage to make larger investments. You`ll be getting the opportunity to invest with other people`s money – the bank`s – but you get to keep all the profits when the property goes up in value. This reduces the amount of risk you are actually taking in order to earn rewards and also reduces the amount of cash you have to tie up in the investment.

If you want to invest in real estate and take advantage of these benefits, as well as of the opportunities that exist in the down market, it is important to educate yourself. You need to know what gives a property a good value and what makes it a bad one. Location plays a major role in this, so pay attention to up-and-coming areas or areas where property values appear to be on the upswing instead of stagnant or moving downward. A look at comparable sales as well as rental rates and the amount of months it would take to sell all current properties in a given market are all useful metrics used by real estate investors.

Finally, make sure you don`t get in over your head financially. Use a mortgage calculator to find out what you will owe each month and make sure you can pay it back. Don`t count on rental income or low teaser rates when making this decision either or you can get into financial trouble.

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Investment Options for Beginners

by: admin - December 6th, 2011   Filed under: Investment Tips

Investing can be scary for beginners. Committing your hard earned money to an endeavor that may never show a return is an intimidating proposition, especially if you have only a basic understanding of how the process works. Though it`s daunting, investing your money wisely is one of the best ways to prepare for the future.

It`s important to realize that investing isn`t guaranteed to make you rich anytime soon. It happens occasionally, but for most of us it`s a way to steadily build a nest egg that we can use for life`s big expenses, such as college and retirement. The best way to navigate the confusing world of investing is to develop an understanding of the best options for beginners.

Buying stock is often the first area of focus for new investors. It`s a great way to gradually build wealth through careful choices. As with any other investment, there are gains and losses but arming yourself with knowledge about the companies you will potentially invest in is a must.

Many people choose to use a brokerage firm to guide their investment decisions and this is a good idea for those learning to navigate the stock market. Keep in mind, however, that there are stiff commissions involved that decrease the amount of profit you ultimately make. Many companies allow you to purchase stocks directly from them, which is an option you may want to consider as your experience and confidence increases.

Mutual funds are another good investment option for those just getting their feet wet. They work by combining the money of many investors into one fund, which is then invested by a professional manager into various endeavors, such as stocks, bonds and CDs. This allows you to diversify your investments without spending hours researching each option. It also allows you to buy interest in companies you wouldn`t normally have access to, as they require a much larger initial investment than most beginners have access to. As with stocks, you can purchase mutual funds on your own or hire an advisor to help with the decision.

Forex, or the Foreign Exchange, is another investment opportunity that beginners may want to consider. Simply put, Forex allows one currency to be traded for another and is the most constantly changing market in the world. Individual investors most often trade Forex through the spot market, which exchanges actual currencies and is influenced by interest rates, anticipated future performance and even political environment.

Forex investors can choose to go it alone, but without in depth knowledge this option could take several years to master. Unless you have the time to spare, obtaining the services of a Forex investment broker is the best option. You can choose from full service brokers, who not only give advice, but actually buy and sell the currency on your behalf, or an online broker who provides information and tools for trading. Full service brokers charge a heftier fee, but are a good investment until you develop a solid understanding of this investment option.

Choosing the best way to invest your money is not a decision to take lightly. Learn all you can about the various opportunities before sinking your cash into any of them and always use well-known brokerage firms to avoid being scammed. Fortunately, Moneysupermarket.com offers financial advisors who can help to navigate the wealth of investment opportunities and offer suggestions based on your individual situation.

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Financing your first investment property – Is it a hard deal?

by: admin - October 21st, 2011   Filed under: Investment Properties

Are you looking for your first investment property? If answered yes, the first deal can often be a tough one as the lenders will not lend you with the proposed amount without certain qualification. Though financing your first investment property can be a daunting task, yet you can easily turn the whole experience into a favorable one if you remain careful while taking the required steps. When it comes to investing property, you should be very careful as the amount involved is a huge one. The interest rates that you have to pay on the credit options like mortgage loans are the biggest payments that you make in your life and therefore it is always better to take the steps that can lower the rates on the financing option. Here are some vital considerations to take into account.
Check your credit score: No matter how well you’ve managed your finances previously, if you have a poor credit score, the financing company will not give you a loan within your means. The credit report or rather the credit score implies your financial worth and without this you can never convince the lender about making timely payments on the loan. If you want to grab lower rates on the loan, you must go for credit repair so that they can’t refrain from offering you low rates within your budget.
Decide the amount of loan you need: By judging the value of your property and your budget, you must also decide the amount that you can borrow from the lender. When you’re investing in a property, remember that this is the biggest investment in your life. If you take any wrong decision, this will boomerang you in the future and you can even go through a forced foreclosure of your property. Thus, always assess your affordability before deciding the loan amount so that you don’t default later.
Understand the game of numbers: Apart from your credit score, your DTI ratio or the debt-to-income ratio is yet another factor that is taken into consideration by the lender in order to make sure whether or not you can make timely payments on the loan. A commercial or a personal mortgage loan will ask for a high monthly payment and if you have too many debts in accordance with your monthly income, they will become skeptical about your repayment ability.
Offer a large down payment: If you offer a large down payment on your mortgage loan, the interest rates will be much lower than what you could have thought. However, make sure that the down payment amount is also within your budget so that you don’t have to fall back on the monthly payments of your other debt obligations.
Thus, when you want to invest in a property for the first time, take all the needed steps so that you don’t make it a bad deal. Take out an amount of credit that is within your budget and repay it sooner to become debt free.

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How To Hire An Investment Firm To Manage Your Investments

by: admin - January 21st, 2011   Filed under: Investment Tips

Looking into hiring an investment firm to help manage your investments can br a very difficult process to go through as you need to be sure you hire the right people. You are likely to make a mistake or two along the way and yes it can end up costing you some money if you happen to make a mistake along the way.

Here are some savvy suggestions to selecting an Investment Firm.
One of the most important factors you should be looking for when looking for someone to handle your investments is integrity. You have got to be able to trust the people that handle your money as much as you trust your personal health care provider as both individuals will have your future in their hands.

You need to be completely honest from the start as to what your financial goals happen to be. In order for an investment firm to be successful in managing your money they need t know what you hope to accomplish with your investments. If you are unsure about any part of the investment process the best investment firm for you will be the one that will explain things until you understand them completely..

A good investment firm will have advisors that will want to help you learn more about what is being done with your money. You should know what is going on with your investments every step of the way. It is part of their job after all.The rates of the investment firm that you select should be willing to negotiate their rates depending on what your level of wealth happens to be.

The investment firm that you select should be 100% upfront about all of their fees as well as the commissions that they make. There is absolutely nothing wrong with your investment advisor making money as it is what they do to provide for themselves and their family. It is however without a doubt ok if you question their being a lower rate for each choice that is put in front of you. If a higher rate makes the most sense for your particular investment situation the investment firm should be able to spell out why.

The last thing that you should keep in mind when you are looking to select an investment firm is if you ever feel not so good about anything that is going on with the investment firm and what they are doing with your money them find another firm. It is up to you to be the main person looking out for you and your family’s best interest.

Article Source: http://www.articlesbase.com/investing-articles/how-to-hire-an-investment-firm-to-manage-your-investments-794125.html

About the Author

Scheirer Wealth Management is the leading Orlando Financial Planning and private wealth management company. They have the reputation as Orlando’s favorite retirement planning agency.

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Boutique Investment Firms Re-Emerge As Banks Stagnate

by: admin - January 17th, 2011   Filed under: Investment Tips

There seems to be a common misconception among many outside the financial sector: your money is safe with the bank. In reality, your money is no safer with the industry giants than it is with any number of smaller players, case and point Merrill Lynch and Lehman Brothers.

It is names like Bernard Madoff and Charles Ponzi that scare people away from boutique investment firms, but the fact is, your money may be safer in these institutions than they are when investing with a large financial institution. Boutique investment firms offer a significant competitive advantage when compared to industry giants, especially the banks.

Though definitions vary, boutique investment firms usually have less than $2 billion in assets under management. They are typically employee-owned with key investment personnel being founders or significant owners. Thus, because these investment managers tend to have significant personal assets tied up in the business, their interests are closely aligned with shareholders.

This article outlines six competitive advantages boutique investment firms have over banks and large financial institutions.

Advantage #1: Continuity and Consistency of Investments:

One large reason boutique firms offer better performance is because they tend to be owner operated, which offers greater continuity. Portfolio managers at large investment firms or banks tend to get promoted, recruited by another firm, or leave, thus leaving your investments to another manager with different ideas and strategies. This is much less likely to happen with an owner-run fund. In fact, 11 of the top 20 performing equity funds in the last 10 years are managed by their founders.

Advantage #2: Agility and Flexibility

Since boutique firms are smaller, they have the agility and flexibility to make quick decisions, that larger investment firms do not because they are encumbered by layers of management and bureaucracy. Smaller firms are able to focus entirely on investment management. They are less focused on personnel and the bureaucratic issues that come up with a larger firm.

Advantage #3: Customized Service

For many retail banks who offer private banking services, private wealth management is only one of their divisions. They often have to share IT legacy systems, company policy, and customer relations, making it difficult for them to handle bespoke requests. Boutique banks are built to serve a few important clients. The company’s IT system, culture and service model are designed to meet the needs of highly demanding clients.

Advantage #4: Relationship Based on Trust

Boutique banks tend to treasure their relationship with clients, as the account means more to them than it does the bank. Many private bankers at boutique firms aim to cultivate strong relationships with their clients, where selling becomes secondary to maintaining long-term relationship. Many private banking clients therefore make decisions together with their bankers, instead of just placing market orders through them. Private bankers usually have a deep understanding of their clients, their family history, risk tolerance and investment philosophy; these types of insights are not commonly provided by the advisors at retail banks.

Advantage #5: No Conflict of Interest

Large retail banks will often put you into their own products, like mutual funds and growth funds, not because it is in your best interest, but because the bank gets management fees from both portfolio management and fund management. With boutique investment firms, the investment choices are based on what is best for you.

Advantage #6: Lower Management Fees

Because boutique investment firms have lower overhead, less administration, and less bureaucracy than commercial banks or large investment firms, they typically can offer a competitive investment management fee. Not only do clients get a higher level of service and competency, it also costs less.

Many see the re-emergence of the boutique investment firm as part of a natural progression. As we exit this recession, the Feds are realizing that mega financial institutions are not sustainable nor are they necessarily in the best interests of society. Nimble, focused, high touch firms are the bedrock of capital formation and not ‘too big to fail’ financial institutions.

Article Source: http://www.articlesbase.com/personal-finance-articles/boutique-investment-firms-re-emerge-as-banks-stagnate-3993098.html

About the Author

Jeff Kaminker is licensed as a Portfolio Manager by both the Ontario and Alberta Securities Commissions. He holds an MBA and Engineering Degree (With Honours) and is a member of the CFA Institute and the Professional Engineers Society.

Jeff has over 15 years capital markets experience. Prior to founding Frontwater, he served as Senior Director, George Weston Limited where he led mergers and acquisitions and was responsible for running a $500 million commodity portfolio using advanced derivative strategies and risk management techniques. Jeff currently works with a number of large corporations in structuring risk management and hedging programs.

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Is foreign exchange trading the best investment out there?

by: admin - January 12th, 2011   Filed under: Foreign Exchange Trading, Investment Tips

You can bet that at least a handful of participants in the forex market would swear by it as the best investment they have ever made. The question is whether or not such a sentiment is shared by the rest of currency trading investors in the world. This article can only venture a speculation. However, we can still make an objective assessment of how foreign exchange investments and other forms of investments fare against each other.

To say that one financial instrument is the best investment over the rest is as much a risky business as investing itself. For one investor, stocks may be the best investment there is. Another investor might only stick to property investments as his ideal. For yet another investor, forex may be the holy grail of investing. This is only to illustrate that when it comes to financial investing, the most applicable maxim would be to each his own.

But from the point of view of an outsider, no single investment program can ever claim to be the best. There are several reasons for this and we will attempt to enumerate them in the following part.

All investments carry risks. Stocks, bonds, mutual funds, properties, forex – you name them and they have it. Any form of capital investment includes the risk of loss. Investing is always a gamble; you hope to gain based on what most other investors would consider sound financial parameters.

Some investment advisors would say that certain investment instruments carry more risks than others. That is however only one side of the coin. The other side points to an individual investors risk tolerance or the level of one’s acceptance for the possibility of financial loss. Therefore, while all investments do have risks, people’s risk tolerance vary such that for some low risk investments are their cup of tea but others would consider high risk programs as the best investments.

Taking forex again as an example, the foreign exchange market is highly volatile which accounts for many novice investors’ failure in it. Still, investors who can stomach such losses and are financially able to continue to play the currency trading game will at some point find success. The same analogy should hold true for other form of investments.

Flexibility of FX investments. With investments, flexibility may refer to a number of different things not all of which are related to each other. Flexibility in capital requirement is one; having flexibility in terms of liquidity is another. Forex investments are said to have both. But not only that – FX trading is also flexible insofar as trading hours is concerned due to the global scope of the FX market.

Now these things may seem to be advantages for FX investments, however there are also cons opposite these pros. Flexibility may also be perceived as inconsistency of the market to produce wanted results, which again points to the high volatility of the FX market.

In conclusion, forex is just like any other investment with its particular downsides and upsides. Claiming that it is the best investment is purely a subjective opinion and should not be the basis for making a decision to dive into FX investments.

Article Source: http://www.articlesbase.com/finance-articles/is-foreign-exchange-trading-the-best-investment-out-there-916962.html

About the Author

To help you make the best investment decisions on forex investments and other types of investments, browse our other reference guides.

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Three Reasons Not To Believe Free Investment Advice

by: admin - December 16th, 2010   Filed under: Investment Tips

How many times have you heard the old saying if it sounds too good to be true it probably is? Well the same goes for free. Free is nice but sometimes you get what you pay for so check out these three reasons not to believe free investment advice.

Of the three reasons not to believe free investment advice training is very important. The internet has changed how we do a lot of things including investments. We can buy and sell stocks all with just a couple of keystrokes. It’s very easy to open a business as an investment advisor for free.

But who says what kind of training they have if any at all. Are they just playing with your money and risking it all. After all they have nothing to loose right? If they offering their service for free be skeptical about their training and be wondering about agenda. Of the three reasons not to believe free investment advice this one really needs your attention!

Number two of the three reasons not to believe free investment advice is that they will often offer you free investment advice that points you towards a specific stock or stocks. The advisor may be pushing stocks that they might have a vested interest in or they making money off your buys which is how brokers get paid. What ever their motive there’s a good chance that you are no more than a pawn in a game and there’s a really good chance that you are not going to benefit from the experience which is of the three reasons not to believe free investment advice this could be the most important.

We said there were three reasons not to believe free investment advice so here is number three. What type of information are they asking for? Personal information? Credit card information? When someone offers up free investment advice make sure you know what the real cost is. Of the three reasons not to believe free investment advice this was has the biggest potential for damage to you personally.

There are plenty of other reasons other than these three reasons not to believe free investment advice but I’m sure you get the picture. Trusting your money with free investment advice is rather like trusting your life with an unlicensed doctor.

These three reasons not to believe free investment advice are probably the most important of all the reasons.

Article Source: http://www.articlesbase.com/investing-articles/three-reasons-not-to-believe-free-investment-advice-104188.html

About the Author
Joel Teo is the owner/webmaster of http://www.GlobalProsperity.info/ the free financial article directory. .

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Retirement Investing Advice

by: admin - December 13th, 2010   Filed under: Investment Tips

Baby boomers look for retirement investing advice as they should. Since this generation is living longer and healthier than their parents and grandparents, they need to have enough to support them or return to the work force. In today’s economy, many companies are not providing company pensions or a 401K.

 Unless you inherit a large sum of money or win the lottery, you will need retirement investing advice for sure. Social Security will not be enough to live the way you want.  We are hearing that Social Security that we are relying on may not be there by the year 2047. In additions, how many jobs will be available for you at your age?

Retirement investing advice is serious. There are only a few ways to save for retirement in qualified (being tax deferred) plans.  They are:

1)    Company sponsored 401K plan. This is considered ‘FREE’ money.

    The money comes out of your paycheck pre-tax. So contributing

    6% doesn’t make too much of difference in your take home pay.

    What you contribute is tax deductible and taxes are deferred. So,

    you don’t pay taxes until you withdraw funds. Usually, your tax

    rate us much lower when you reach here. Also, your company is

    also contributing to your 401K up to a certain percentage. That’s

    why it’s ‘FREE’ money to you. When you are seeking retirement

    investing advice, jump on this 401K if you are fortunate to work

    for a company that offers it. Retirement investing advice can be

    offered by the company or the third party firm who administers

    the 401K plan. You have many options. Risk (younger age ),

    conservative or as we mature in age, guaranteed funds.

2)    Traditional Individual Retirement Plan (IRA). This plan is also funded with pre-tax or tax deductible dollars. There are maximum amounts that can be contributed each year. Starting in 2005, it is $4,000.   If you are over 50, you can use what is called ‘catch up’ amounts to contribute each year. If you are also a part of a 401K, you will be restricted as to how much you can contribute to a traditional IRA. If you file your taxes separately from your spouse, you can avoid restrictions by having the IRA in your spouses name.

3)    Roth IRA is another retirement investing advice tool. This however, is funded with post (after) tax dollars. You will not get a tax deduction the year you make your contribution. The good thing is that Roth IRA’s are not taxed ever again, including earnings on the investment. For this to happen, you must have the Roth IRA for a minimum of five years and be over 59 ½ years of age.  There are allowances to use the funds without penalty before retirement, such as major medical expenses, down payment on your FIRST home or education.

Retirement  advice may include changing your lifestyle before your retire. Why? To get acquainted with the lifestyle you may have to embrace. Retirement investment advice indicates that you may have to downsize and change old habits.

* Hold off on home improvements or do them yourself.

* Stop eating meals out. Start planning menus.

* Trim your wardrobe. Get used to wearing clothes longer. Purchase a        hand steamer instead of sending clothes to the dry cleaner.         Sending clothes to the dry cleaner ( in my experience) shortens              the life of the garment.

* Don’t buy books. Get a library card and visit the library.

* Only keep one credit card for emergencies only.

* Don’t purchase a new car. Seek pre-owned dealer warranted auto’s

* Keep thermostat lower

This is only a few area’s for your retirement investment advice for your to consideration.  Retirement investment advice takes a lot of diligence on your part.  Always seek professional retirement investment advice from a qualified specialist.

Article Source: http://www.articlesbase.com/investing-articles/retirement-investing-advice-3286356.html

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Timing The Market for Your Mutual Funds

by: admin - July 31st, 2010   Filed under: Investment Tips

When investing in bonds, stocks, or mutual funds, investors have the opportunity to increase their rate of return by timing the market – investing when stock markets go up and selling before they decline. A good investor can either time the market prudently, select a good investment, or employ a combination of both to increase his or her rate of return. However, any attempt to increase your rate of return by timing the market entails higher risk. Investors who actively try to time the market should realize that sometimes the unexpected does happen and they could lose money or forgo an excellent return.

Timing the market is difficult. To be successful, you have to make two investment decisions correctly: one to sell and one to buy. If you get either wrong in the short term you are out of luck. In addition, investors should realize that:

1. Stock markets go up more often than they go down.

2. When stock markets decline they tend to decline very quickly. That is, short-term losses are more severe than short-term gains.

3. The bulk of the gains posted by the stock market are posted in a very short time. In short, if you miss one or two good days in the stock market you will forgo the bulk of the gains.

Not many investors are good timers. “The Portable Pension Fiduciary,” by John H. Ilkiw, noted the results of a comprehensive study of institutional investors, such as mutual fund and pension fund managers. The study concluded that the median money manager added some value by selecting investments that outperform the market. The best money managers added more than 2 percent per year due to stock selection. However the median money manager lost value by timing the market. Thus, investors should realize that marketing timing can add value but that there are better strategies that increase returns over the long term, incur less risk, and have a higher probability of success.

One of the reasons why it is so difficult to time correctly is due to the difficulty of removing emotion from your investment decision. Investors who invest on emotion tend to overreact: they invest when prices are high and sell when prices are low. Professional money managers, who can remove emotion from their investment decisions, can add value by timing their investments correctly, but the bulk of their excess rates of return are still generated through security selection and other investment strategies. Investors who want to increase their rate of return through market timing should consider a good Tactical Asset Allocation fund. These funds aim to add value by changing the investment mix between cash, bonds, and stocks following strict protocols and models, rather than emotion-based market timing.

About the Author:  Dana Silva invites you to visit her Caring For Dogs website to learn about dog dementia and dog dental care.

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