Ways to Invest and Profit on the Internet: Online Share Dealing and Spread Betting
Jul0
The current financial crisis is set to be on a par with some of the biggest crashes of the 20th century, and all outlooks for the future look pretty gloomy. But there are still great opportunities out there for financial-minded people to make good money using the wide range of online trading websites that are taking the stockbroking industry by storm.
The history of our global boom and bust economy shows that the periods of downturn always mean the weakest links in the chain don’t survive. Only those who are the most able to adapt and be efficient have a chance of survival. The same goes for individual investors. In the past, if an individual wanted to buy and sell on the stock market, the fees involved could become exhorbitant. There are brokers who would take a 20% cut on investment profits in addition to a 2% fee annually. That can turn a 10% return into just 6% – even less depending on your management fees. The issue becomes worse when you consider the constriction of profits caused by the recession. The truth is, many investors today finding it increasingly hard to maintain their profit margins using traditional channels of accessing the stock market.
This situation, however, is evolving. As the digital age matures, we’ve got access to instant real time information, high speed internet and sophisticated trading software. What this means is that you are now able, to a certain extent, to cut out the guy in between taking a cut of your profits, and trade directly on the market. Online sharedealing websites mean you can take control of your investment porfolio for very little cost.
Taking a long term, strategic perspective on your investment decisions is also something that becomes easier and more manageable with online trading. It’s a far smarter approach than only looking at the short term quick wins
A consequence of the lack of predictability of the markets in the current financial climate, means that trading techniques such as financial spread betting are also on the rise. This involves betting on a rise or fall in share prices and doesn’t involve stock purchase at all. This is rightly known as the more risky side of trading, and losses can be big – but so can gains, if you do things right. A variant of financial spreadbetting is CFD trading, or Contracts for Difference. These involve an agreement between two parties to pay out on the difference between an opening and closing share price. Spread betting and CFDs are both attractive alternatives to actually purchasing and selling shares amongst investors, particularly as you can profit from falling prices just as much as rising ones. They are both also really simple to get into online, which has also lead to the increasing usage of online CFD trading and spread betting of late.
So what is the conclusion to all this? Just as the biggest companies and conglomerates are having to shape up, reduce costs and prove their versatility during the economic downturn, so must the individual investor. As far as safeguarding yourself against the slings and arrows of outrageous recession is concerned, the strongest tool in your belt might be to switch to online trading.
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Investing in Gold to Balance Your Portfolio
Jul0
In times of economic crisis, some investors turn to gold as an investment hedge (a sort of financial “insurance”) to protect their investment portfolios. That makes a lot of sense today, given the current value of gold.
Gold as an investment will rarely lose it’s value and will help add stability to your investment portfolio. That is why investors have traditionally turned to precious metals in times of widespread financial woe.The lustrous shine will always shine brightly.
Considering the current financial climate, one might consider if it is a good time to buy gold. Even people who have very small or nonexistent investment portfolios are considering purchasing some gold.As Gold prices continue to skyrocket is seems pointless not to have a small investment?
Unfortunately, there is no straight answer to that question. For some people, now is absolutely the time to buy gold. For others, it is not a good time. So how do you know if it is a good time for you to buy gold?
Do you have a significant amount of consumer debt such as credit card balances or car loans? If so, you would be better off applying any extra money you have to your debt. Are you overly concerned with the short-term performance of your investment portfolio?If this is the case, then it may not be a commodity for you. This is because gold does not generally have a good return.
“How can that be?The price of gold is high! If I had bought gold years ago, I could sell it for so much more now!”
True, but all those years you would have kept gold in your portfolio, you would have been paying to keep it there. No matter how you hold your gold investment, it does cost something to keep it. If you keep your gold in exchange-traded funds (ticker symbol GLD), you pay a small fee to handle the price of “storing” the gold, and you pay your broker a fee on whatever you make on your gold. If you keep your gold in a safe-deposit box, you pay for the safe-deposit box and for the insurance you would need to protect your investment. The same goes for storing the gold in your home. The very thing that makes gold so attractive (the fact that it is tangible) is the thing that makes it so risky. If someone steals it, it is gone.
The ways mentioned above are the best ways to invest. It is not wise to invest in gold stocks – you are really investing in the company that mines the gold, so while you get partial ownership of that company’s gold, you are still vulnerable to that company’s business practices and financial pitfalls.
Even buying gold coins, bullion, or bars is potentially risky. You want to make sure you have the purest form of gold if you invest. Paying full price for a precious metal with fillers is a real possibility in a market that is flooded with questionable merchants pushing gold at every opportunity.
With so much to consider, one might be inclined to skip the current “gold rush.” Not so fast. For some investors, now is a great time to buy gold. If you have some extra money for investing and know how gold will affect your portfolio, gold is a great addition that will round out your portfolio and reduce fluctuations.As a long term investment strategy, adding gold to your portfolio is a wise decision.
Additionally, if you have a reputable dealer and some place safe to store it, you could buy gold to store yourself. There is something to be said for having assets you can touch.
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