While the $700 billion dollar bailout is being worked on, Wall Street had to stay patient this week. But, as you may already know, patience is not their forte. For the week, the S&P 500 fell -3.33%, Dow -2.15%, the…
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While the $700 billion dollar bailout is being worked on, Wall Street had to stay patient this week. But, as you may already know, patience is not their forte. For the week, the S&P 500 fell -3.33%, Dow -2.15%, the…
Read more…
Mail this postPopularity: 83% [?]
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By Jim Nettleton
In these days of the ever-present Internet, there is almost nothing that we can’t do online. Making and managing your investments is no exception. Online investing offers many benefits as compared to traditional methods. For one thing, decisions can be made instantly and transactions are swift, allowing the investor to take advantage of rapidly changing conditions.
Another advantage of online investing is the commissions on trades are frequently much smaller. If you’re an active trader, that can add up to substantial savings in any given month. With an online account, you can study your portfolio at any time, instantly, twenty-four hours a day from anywhere in the world that has Internet access.
There is, of course, a downside to all this convenience and instant trade orders. You need to exercise discipline because online investing does make it extremely easy to plunge into a bunch of trades pretty much all at once. Depending on your risk tolerance, this can be a very dicey proposition.
In any case, step number one is choosing a broker. You’ll need to choose either a full service or a discount broker. If you’re looking for help and advice, the full service broker should be the choice. Their commissions are typically higher, but if you’re new to investing, especially investing online, you might feel more comfortable with a safety net that such brokers can provide.
If you’re experienced, the discount broker may be the way to go. Discount brokers usually don’t provide the research and insight that full service brokers do, but if you know what you’re doing it’s the more economical way to go.
Most of the major, household name type brokerage houses offer online investing. There are many others who have blossomed since the advent of online investing and specialize only in virtual investing. Communicate with several of both varieties before settling on the broker you feel most comfortable with. For in depth information about the fascinating world of online investing, visit my site through the link in my resource box below.
The amount of money that you must deposit to open an account varies widely from broker to broker. Allowable margin accounts also vary greatly. You’ll have to do your homework to gather information on these topics with the various brokers you contact. Here, too, you don’t have to talk with anyone if you don’t care to. Most of the information you seek is available online.
The world of online investing is a modern day adventure that can bring great rewards is the waters are navigated intelligently. Exercise caution in your investing and follow the old advice to never invest more than you can afford to lose.
So perform your due diligence, open an account and start trading the modern way and the smart way – start trading online. Good luck.
About the author:
Jim Nettleton is a radio and TV professional with wide-ranging interests and who loves to day trade. Visit his online investing guide at http://www.jaynetinc.com/SmartOnlineInvesting
Mail this postPopularity: 79% [?]
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Mail this postPopularity: 78% [?]
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By Jim Nettleton
Currency trading has gained much popularity in recent years. Once thought to be the playground of the rich investor, it has become apparent lately that the currency trading market is accessible by investors of all levels.
Forex has now become an often-used term as opposed to just a few years ago when most people had never heard it. Now, the advantages of Forex trading are readily appreciated as more and more investors devote the major portion of their investing activity to the Forex market. The trading of currency involves simultaneous purchasing of one currency and selling of another.
It is the world’s largest market, with trades every day totaling over three trillion dollars, a staggering amount. It’s no wonder then that investors have flocked to it given the enormous amount of money changing hands and the opportunities presented by that volume.
One of the best things about this arena is that one can practice at will and play games online to improve skills and knowledge. Pretend, or phantom trading is referred to as ‘the game’ in the Forex field. This, of course, allows you to risk no funds while you thoroughly learn techniques through constructive practice.
To locate sites that supply practice training simply do a Google search for ‘Forex Trading’ and many sites will be presented. By the way, the term ‘Forex’ is derived from the formal name of the trading type, Foreign Exchange. The trading practice is also sometimes referred to as just ‘FX’.
For a complete overview of the Forex market, visit my web site through the link in my resource box below.
A major difference in this market, as opposed to the stock market, is that trading is not accomplished through a central point, such as the New York Stock Exchange. Trading in the Forex market is done on a direct basis, that is, between the two parties who are making the trade. Another major difference is that trading takes place twenty-four hours a day, through trading centers all over the world. The market trades continuously from Sunday night at 20:00 GMT to Friday night at 22:00 GMT. That gives investors a chance to make trades based on financial developments in the news without having to wait for a market to open the next day.
Many times, trades are done without commissions coming into play, a distinct advantage over the stock market. Still another advantage is the liquidity of the market, which translates into a constant supply of sellers and buyers, so there’s always a trade in the making around the clock. The market is constantly in flux and presents trade opportunities no matter whether a particular currency is moving up or down. The Forex market also offers the investor great leverage. An investor can control a position that is as much as one hundred to one more than his margin deposit.
Currency trading is a fascinating field and one that should be looked into if you are searching for an opportunity to invest and a chance to seriously increase your net worth. Check it out carefully and do practice investing before you make the plunge. And, of course, never risk money you can’t afford to lose. Visit my site listed below for much more information.
Good luck.
About the author:
Jim Nettleton is a radio and TV professional with wide-ranging interests. Visit his thorough Forex site for information in depth, real time quotes on currency pairs and free conversion tools.
http://www.jaynetinc.com/ForexMaster.
Mail this postPopularity: 61% [?]
There are some people that will tell you that forex trader training will work for any person, but I have found this to be completely untrue. I think that many systems work most of the time, but the absolute best ones work even more often. Some are meant for newbies, and others are meant for people who know what they are doing. If you need to make the most of your trades, then it is important to obtain the best forex trader training that you can. This is definitely a very important step of your trading career.
One of the first steps for finding forex trader training is figuring out where exactly you are in your trading career. Do you have very little experience trading, or are you almost an expert? Is money a bit tight right now, or are you just looking for some extra cash? It is important to ask these questions if you really want to find the best forex trader training you can. Only use your money on things that will be beneficial to you forex trading. Once you know what kind of trader you are then you will be in a much better position to find the right kind of forex trader training.
Another thing to think aobut is how much money you will be able to put into good forex trader training. Although many of these programs have similar features, a few have things that only expert traders will understand and be able to use correctly. If you can survive with a cheaper training program than you will definitely save some cash. Be sure that the training actually helps you make money, but also make sure you have enough money in the first place to get training. If you don’t, you probably should think about not doing forex until you are ready. This just means that you should have some extra money just in case the trading is a bit rough. In this type of investment, you really can’t know whats coming next.
You can finally choose the best forex trader training program for you once you know exactly what you can spend on it. The training should hopefully work pretty well for you. Once you have good, solid proof that the training will definitely improve your trading, you will be ready to start. The is the final step to find your forex trader training. You are ready to make money trading forex now.
In my experiences, I have found that overall, forex trader training that works for the most amount of people is the Forex Brotherhood. I would seriously recommend this to almost all traders who want forex trader training. As a member of the Brotherhood, learning forex will be much easier.
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Stocks should be the cornerstone of your investment portfolio because have averaged around a 10 percent return over time. They generally rise when the economy is doing well and fall when the economy is weak. In fact, stocks are leading indicators insomuch as they rise before the economy picks up and they fall prior to a downturn in the economy.
Bonds behave a little differently. First, historically, bonds and bond funds have fared much less favorably than stocks over the same time horizon. They rarely beat inflation. There is a situation, however, where it’s not only prudent to buy bonds and bond funds, but it’s downright the smart thing to do.
When inflation rears its ugly head, the Federal Reserve raises short-term interest rates with the objective being that higher rates leads to lowered money growth and a slowing economy. This pretty much kills bond returns. However, if you know a little history, you’ll soon find that interest rates usually peak at a certain figure and stay there a short time, and then begin to fall again.
It’s when rates begin to fall that bonds increase in value. Why is this? You’d think a bond would be most valuable at its highest interest rate. But say you bought a bond that yielded 8 percent for 30 years for $100. If rates are now 12 percent, and you wanted to sell your bond, you’d have to take less for it than face value, such that its yield was 12 percent.
Rising interest rates = falling bond prices
Falling interest rates = rising bond prices
If you time your buy and sell just right, you can make a ton of money. Further still, if you buy the right kind of bond or bond fund, you can make a killing. Zero coupon bonds have maturities that range from 1 year to 40 years.
To illustrate an example of how leveraged a zero coupon bond is, note that a 30-year zero that yields 9 percent will rise in price from $71 to $171 if interest rates fall to 6 percent. A 33 percent drop in interested rates caused an effective gain of 140 percent. This is not an unprecedented event. Back in the late 70s and early 80s, rates rose to 18 percent of so, then fell quite drastically. Bond prices went through the roof.
Zeros are very volatile. Unfortunately, interest rates can – and do — rise and cause major downswings in bond prices.
Leverage is a two-way street
All sorts of entities offer zero coupon bonds. However, the easiest, and least likely to be called are US Treasury zeros. And buying through a zero coupon bond fund is very easy and convenient.
If you do some thoughtful analysis and research, keeping an eye what the Fed does and is going to do with short-term interest rates, you will be able to determine, with some level of certainty, the direction of long-term interest rates. You may not be able to pick the top or bottom, but that’s not as important as finding the direction.
After all, you want to pick your zeros at a high enough rate to lock in a solid gain if you hold to maturity, but the point is picking them at a rate that will fall enough to give you the sky-high returns that they promise because of their leverage and volatility.
So, pick up shares in a zero coupon bond fund when the time is right (NOT NOW, by the way, as interest rates are pretty low, making this precisely the wrong time to invest in zeros) and watch your portfolio balloon.
Mail this postPopularity: 65% [?]
Not investing in the stock market means you’re leaving a lot of potential money on the table. The prudent investor, even in tumultuous times like we’re currently experiencing, is nearly fully invested all the time. As Jim Cramer of Mad Money fame says, “There’s always a bull market somewhere.” What he means by that is that there is always a market, an industry, country, or region that is outperforming the market in total.
One of the best ways to invest in sectors, countries, and regions is through Exchange Traded Funds, better known as ETFs. They’re especially useful for lump-sum purchases, as you pay one low commission per trade. There are two things you must do in order to purchase an ETF: You’ll need to decide which one(s) to buy and once you know what you want to buy, you’ll need to execute that buy.
This article will focus on the execution of the buy order. Selling, for the most part, is the opposite, just like stocks.
ETFs act like mutual funds but are bought and sold like stocks. Like mutual funds, an ETF is a collection of stocks bought and sold according to changes in the underlying index it is replicating. ETFs are passively-managed just like index mutual funds; only when an index changes does the fund manager buy or sell securities. Like stocks, buying and selling an ETF incurs a commission. You can also short an ETF as well as buy them on margin (unlike mutual funds).
In essence, ETFs offer the benefits of both mutual funds (low fees, instant diversification) and stocks (low commissions, instant liquidity).
The first thing you’ll need to do is open an account at a brokerage. I suggest that you use an online, discount broker like eTrade, Zecco, or TradeKing. These offer very low commissions (around $7-20 per trade), fast execution, and several flavors of limit orders.
Once you’ve established an account, you’ll need to fund it. There are a multitude of ways of doing this; I’ll mention a few.
I prefer the last method, as it incurs zero cost and gives a good compromise between the first and second options in terms of getting your money to the brokerage in a reasonable time (usually 2-4 business days).
Once funded, you can decide what kind of order to place. Generally, on the buy side, you’ll want to execute a market order, which means that you will purchase the ETF at the price it’s at when you place the order. It’s akin to going to the store and buying milk: You pay the current price.
A limit order, on the other hand, is like waiting for a sale. You tell the brokerage that you will make the buy only at a certain price. In a bull market, placing a limit order sometimes effectively takes you out of the run-up because the price never declines until many months later, on the way down.
However, placing a limit buy order does ensure that you pay what you think it’s worth. It’s just that your estimate of worth may differ from the market for a long, long time.
After you’ve decided whether to place a market or limit order, you now simply must place the order. Doing so online is a snap. Input the particulars of your order: How many shares, what kind of order, etc. Most online brokers ensure that you review your order before you place the order. Review the order carefully, ensuring that all of your specific order instructions have been made, and then
PLACE THE ORDER
Congratulations, you’ve now invested in one of the hottest securities going: Exchange Traded Funds!
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Investing in stocks is one of the best things you can do with your money. Purchasing individual stocks requires skill, time, and a certain mental fortitude, as well as a considerable capital investment to ensure ample diversification. You certainly don’t want to put all of your eggs in one basket.
Stock mutual funds take a lot of the guess work out of picking individual stocks. Fund managers have more time and skill than you do, and they pool your money along with thousands of others, to attempt to create that diversification that is so necessary to mitigate risk. Of course, you can never eliminate market risk; that’s where you seek to allocate your assets among other investments like bonds, metals, currencies, and real estate, to name a few options.
Certainly, the cornerstone of your stock portfolio is index funds. These are passively-managed mutual funds that replicate the performance of the index they follow. They are considered passive because there is no active fund management; if the index changes, the fund changes. Index funds with the lowest fees always perform closer to the index than higher-fee funds.
It’s vitally important, then, to purchase low-fee index funds. You’ll simply get better performance.
There is another factor you should consider when buying index funds: The initial and subsequent investment amount. Vanguard offers some of the lowest-fee index funds in the mutual fund world. However, their minimum initial investment is usually $3,000. T. Row Price, on the other hand, often has much lower initial minimums, sometimes as little as $50 if you establish an automatic investment schedule with them. Going this route accomplishes two things: First, you can put your money to work right away, even if you don’t have $3,000 to start. Second, you are practicing the time-honored principle of dollar-cost averaging, where you make regular fixed purchases of a security over time, buying more shares when prices are low, thereby minimizing your average cost.
You’ll want to investigate various indexes. Did you know that the S&P 500 has averaged over 10 percent for a hundred years? Nowhere else can you get that kind of return. You will absolutely want to invest a good chunk of your investment dollars in an S&P 500 index fund. But if you simply invest all your dollars there, you will miss most of the world’s markets, like Europe, Japan, China, Latin America, and Russia, to name a few countries and regions where there are major stock markets and potentially higher returns.
You may wish to consider index funds in those countries and regions. But you may want to invest in actively-managed funds that specialize there. These are funds that are managed by fund managers. As in everything, there are good ones and bad ones. Good ones can beat the market, and bad ones generally do not. Therefore, it is crucial to pick mutual funds that have demonstrated market-beating performance, and the way they do that is by retaining top talent. Peter Lynch, former manager of the Fidelity Magellan Fund, routinely beat the US market averages; he was a stellar fund manager. When he left, the fund took a downturn and has never returned to its former glory.
It’s very difficult to consistently beat the market; in fact, today almost nobody does. However, it’s your money at stake, so it behooves you to find the best fund managers possible.
The last factor to consider when choosing stock mutual funds is the commission: Many funds are no load, which means there is no sales commission, or front-end load. Stick with these. Funds that charge a load put you in the hole right away. For example, say a fund you’re considering buying charges a 5 percent load. If you were to invest $1,000 in that fund, you’d write a check for $1,000 and the fund would deposit $950 in your account and pocket $50 for the privilege to taking your money. You just bought the fund manager a nice steak in almost any city. There is no evidence that load funds perform any better than no-load funds; in fact, the evidence is quite the opposite.
To summarize, choose stock mutual funds considering these factors:
Now, get out there and buy some stock mutual funds! Your future depends on it!
Mail this postPopularity: 39% [?]
There are some people that will tell you that the best forex trading software program will work for any person, but I have found this to be completely untrue. The best systems are specific to different kinds of forex traders, while many of the worse systems just don’t work right. Some programs are meant for newer traders and some are meant for the experts who have been trading for a while. If you really want to make good money in your trading, then you must get access to the best forex trading software that works for you. This is an important step in your forex trading career that cannot be ignored.
You first step in finding the best forex trading software if for you to look at yourself and figure out how exactly you conduct your trading. Are you a newbie, or a little bit more experienced? Are you looking to replace your income or just make a bit on the side? These are definitely crucial questions to ask yourself if you want to find whats good for you. If you don’t have much money to experiment with then it is important not to waste it. Once you are aware of how exactly you trade you will be much more ready to find the right software for you.
Another thing you must determine is how much do you have to spend on the best forex trading software program for you style of trading. Although many of these systems do similar things, a few do things that only expert traders will understand and be able to use correctly. A good deal of these software programs are very expensive so it is great if you can find a cheaper on the works great for you. The most important thing is that the software helps you make money, but it is also important that you have enough money to invest in that software. If you don’t, consider not trading forex. This means that having money stashed away just in case you take a loss. You never know what could happen in this kind of business.
You can decide what is the best forex trading software that you should use once you know what you can afford. Be sure that you actually have some proof that the software works before you invest in it. If you are sure that is till work then go ahead and buy. The is the last step. Now you can make great money trading forex.
In my experiences, I have found that overall, the best forex trading software that works for the most amount of people is the Forex Tracer. I would easily recommend this program to almost all traders. If is incredibly powerful but it is also very easy to use. All traders should get a copy of the Forex Tracer if they really want to use the right program.
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