Investing – How to Invest 500 Dollars – Make a Million Small Investments at a Time
Nov0
The Dow Industrials Average Index has risen since early March 2009, upon the emergence at that time of an unorthodox Candlestick Reversal Pattern which foretold a massive rise in prices. The advance first moved explosively, then haltingly, and has now moved explosively again as Funds and individual investors clamor for more and more investment candy while driving prices higher in manic fashion which recalls the excesses of the Tulip Bulb Craze, the South Seas Bubble, and the stock market environments of October 1929, of early 2000, and of October 2007. The principles are the same, and the outcome will be the same this time too. Manias always come to an end; and when they do, prices return to levels which are even lower than those which obtained when the mania began.
Actually, what we are seeing now is a mania within a much larger mania, which began about 1995. This state of facts obviously bodes ill for the future of stock prices.
The current mania in stocks has been accompanied by correlative manias in gold and in silver. Gold has been driven to a new all-time High; silver has not, although it is tagging along at a lower energy level. It appears that the interest in gold is founded upon a flight from the Dollar, which in turn has been caused by a perception that inflation is on the way, that there is nowhere for the Dollar to go – except down, and that safety is to be found in the comfort of the ultimate Money, which is gold.
Signs of an expiring mania in gold surround us: India exchanges billions of U.S. Dollars for gold, at what we perceive to be exactly the wrong time; Harrods now offers physical gold in various forms, “off the shelf;” an agency of the United Nations is contemplating the creation of a new international reserve currency in place of the Dollar, to be based on a “basket” of other currencies which would be “managed” by the agency (which itself is a warning signal); even famous names tout the death of the Dollar and the glories of gold; and – last but not least – public sentiment as well as the opinion of “experts” is overwhelmingly supportive of gold while demeaning the Dollar.
All of these are contrary indicators. They are beginning to be borne out now by Candlestick Patterns in several time frames in the Dow Industrials, which indicate the probability of a Reversal to the downside soon. This analysis is supported by negative inferences which we draw from Indicators other than the Candlesticks, which use the Candles as the starting point and proceed from there to visual representations which clearly show that Dow prices are fast coming to a top
Resource Author Francisco Rodriguez Higueras
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What, Who, When, Where, Why & How – Investing in Mutual Funds
Sep0
Our current economic crisis has brought down housing prices almost to the ground. The cost for obtaining a home today is the lowest in recent memory. This is an excellent opportunity to invest in real estate, to purchase it with the intent of either making an immediate sale or establishing a long term lease, but with credit no longer flowing as freely as it once did everyone is concerned about property investment finance: will the banks and creditors play ball?. The low prices are fantastic, after all, for those who can afford them, but without the aid of a creditor, who can?
What are Mutual Funds?
Mutual funds are professionally managed baskets of securities primarily consisting of stocks, bonds, and money market securities.
What is the Cost of Investing in Mutual Funds?
With the right no-load mutual funds sales charges can be zero, with less than 1% a year deducted from your account for expenses. With the wrong load funds, you might pay 5% or so in sales charges up front, and/or more than 2% a year in expenses.
It is tempting to think that banks have stopped credit entirely, but that is far from true. Yes, loans are being approved less frequently than in recent memory, but anyone who has a solid plan and a strong credit history should not have major difficulties obtaining a reasonable one.
STOCKS…for growth. If you are willing to accept risk in search of higher investment returns, stocks, commonly called EQUITIES, deserve your attention. Average investors basically make money in stocks two ways: through price appreciation, and from dividends. In other words, stock prices can go up, and many stocks pay income in the form of dividends. If you invest in equities be sure to diversify, don’t put all your eggs in one basket. You can pick your own stocks, or you can get instant diversification by simply buying equity mutual funds.
COUNTERBALANCE INVESTMENTS…for growth and to offset loses in stocks, and perhaps bonds. I view this fourth category as a broad asset class. Included here would be tangibles like real estate, gold and silver, and other commodities. In times of rising inflation, for example, bonds and stocks can both be losers. Smart investors keep an eye open for assets that benefit from rising prices.
Basic materials like iron, copper and aluminum fall into this last category, as do natural resources like minerals and oil. There are various ways to invest and keep it simple here. For example, you don’t need to select, buy, and manage real estate properties to profit from rising real estate values. You can simply buy real estate stocks or mutual funds that invest in equity REIT’s (real estate investment trusts). If the price of oil is going up, you can profit from buying oil stocks or mutual funds that invest in them.
If you want to be a long term investor with a well balanced portfolio, give consideration to all four of the asset classes just discussed.
There you have it…all of the investments in the world in a nut shell. With these investment basics in mind, it’s only a matter of getting specific within each asset class. Notice that there are mutual funds to fit your needs in all four investment categories
Resource Author Francisco Rodriguez H.
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