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US Savings Bonds
http://www.profitableinvestingtips.com/bond-investing/us-savings-bonds US Savings Bonds By www.ProfitableInvestingTips.com US savings bonds are often thought of as a poor man's route to savings. Many aggressive investors and traders scoff at the idea of buying US savings bonds every payday and holding them for as long as thirty years. However, there are a number of advantages to buying and holding US savings bonds. As with all investment opportunities a little fundamental analysis of the subject is useful. So before comparing US savings bonds to dividend stocks, US Treasuries, or municipal bonds let us look at a few specifics about US savings bonds. US Savings Bonds These bonds are available in Series EE and Series I. Electronic series EE bonds are purchased via a Treasury Direct account for face value and paper series EE bonds are purchased at their face value. One earns a fixed rate of interest for the thirty year term of the bond. The treasury guarantees that the bonds will double in face value in twenty years. Series I bonds sell at face value at interest rates guaranteed to exceed that of inflation. These bonds are not tradable. The maturity periods can vary. For example, if you buy a bond with a value of $50 for $25, you'll have to wait at least 17 years to get back your investment from the government. US savings bonds are exempt from state and local taxes. Federal tax is deferred until the bond is cashed in. Interest may be tax exempt if you can document that interest was used to pay qualified higher education expenses and provide that your income falls within federal guidelines for this benefit. As with many long term investments you will commonly cash in US savings bonds when you are retired and when your tax rate is low. US savings bonds pay interest twice a year and are redeemed at par value at maturity. Savings Bonds come in eight values: $50, $75, $100, $200, $500, $1,000, $5,000 and $10,000. Why Purchase US Savings Bonds? There are certainly lots of investments that can make a lot more money over the years than US savings bonds. And there are lots of investments that can disappear in a puff of smoke during an economic downturn. US savings bonds are like money in the bank. A good rule of thumb for investing is to first pay off credit card debt, invest in your home, and put six months of savings away for emergencies. Think of US savings bonds in this context. US Savings Bonds versus Municipal Bonds Like municipal bonds, US savings bonds are free of state and local taxes. Unlike municipal bonds US savings bonds are less likely to default than when cities like Detroit declare bankruptcy. US Savings Bonds versus Dividend Stocks Dividend stocks are a common way to balance the risk in an aggressive stock portfolio. However, even large cap stocks can fall in price or fall out of favor. When markets are falling US savings bonds still maintain their value and pay interest. Buying US Savings Bonds Bonds are purchased with a Treasury Direct account. For such an account you need a social security number, a driver's license, a checking or savings account, and an email address. According to the US Treasury site: Minimum Purchase: $25 Maximum Purchase: $30,000 per person per year Interest: 90% of 6-month average of 5-year Treasury security yields, added monthly and paid when the bond is cashed Minimum Term Of Ownership: 12 months Early Redemption Penalty: Forfeit three most recent months' interest if cashed before 5 years http://youtu.be/YiLuGt62mZA
Views: 19420 InvestingTip
Investing During Deflation of the US Economy
http://www.profitableinvestingtips.com/investing-tips/investing-during-deflation-of-the-us-economy Investing During Deflation of the US Economy By www.ProfitableInvestingTips.com Recent comments by Fed chairman Bernanke indicate that the US Federal Reserve will continue its $85 Billion a month bond buying program. The cited concern is persistently low inflation. The objective of the Fed is to keep inflation above 2% as one of their concerns is economic deflation. Just what is deflation and if things go badly how does one go about investing during deflation of the US economy? Deflation: 1. A decrease in the general price level of goods and services 2. An inflation rate less than zero 3. An increase in the real value of money 4. An economic circumstance in which one can buy more goods with the same quantity of money The Problem with Deflation During periods of deflation cash is king. Deflation makes you richer if you have money in the bank and poorer if you have extensive debt. An advantage of having a slow and steady rate of inflation is that homes and businesses become more valuable over time and the debt taken on to purchase them becomes less of an issue. The reverse happens in deflation when your home and business become cheaper in relation to cash and your debt can become overwhelming. Investing During Deflation of the US Economy If the US economy heads into a period of deflation you want to be holding cash and you want to reduce your debt. Negative interest rates are a possibility. That is to say the bank may want to charge you for holding your money. Fundamental analysis of investments needs to take this into consideration. Companies with lots of cash will be popular as will high paying dividend stocks. Dividends will in fact need to keep up with the diminishing value of stocks as related to the value of cash. Are We Heading into Deflation? Historically deflation is not only possible but common. The USA had long periods of deflation during the 19th and early 20th centuries before the creation of the Federal Reserve. In the current day the concern is of a reduction in demand for goods and services which will lead producers and sellers to drop prices to continue sales. This happened in Japan twenty years ago and the Asian nation is just coming out of two decades of economic stagnation. The policy of the Fed regarding bond purchases is to keep interest rates down and help the economy recover. By pumping money into the system it also tends to increase demand for products and services. To the extent that the Fed reduces its bond purchasing stimulus program there might be a consumer and business retrenchment that could drive down prices. Businesses would compete for business on a price level and the USA could see deflation. Investing during deflation of the US economy would best be as detailed previously. However, they call them economic cycles for a reason. Into Deflation and Out Again Anyone investing during deflation of the US economy would need to remember that the Fed would likely resume monetary policies that would drive the economy back into an inflationary trend. That means that the old blood in the streets adage could apply. Wait for things to look darkest and then use your strong dollars to buy property or stocks in preparation for an inflationary and profitable surge of the economy. A conservative approach would be to diversify your investment portfolio to cover the risk of deflation and prepare for an inflationary comeback. For more insights and useful information about investments and investing, visit www.ProfitableInvestingTips.com. http://youtu.be/Vknk2oUBQuI
Views: 3289 InvestingTip
How Can I Buy Foreign Stocks?
http://profitabletradingtips.com/profitable-trading-tips/how-can-i-buy-foreign-stocks How Can I Buy Foreign Stocks? By www.ProfitableTradingTips.com A couple of years ago Chinese stocks were outperforming all others. And starting a year ago Chinese stocks started a long and painful crash. If you had been trading Chinese stocks there would have been great opportunities for profit both on the run up in prices and in the decline. So you ask, how can I buy foreign stocks? Do I have to know the language? How about exchange rates? Do I need to first purchase a foreign currency in order to buy foreign stocks? The answer is that you can buy foreign stocks as American Depository Shares or Receipts (ADRs). These are traded on American stock exchanges so you can trade them just like any other stock in your portfolio. American Depository Receipts Investopedia defines American Depository Receipt. An American depositary receipt (ADR) is a negotiable certificate issued by a U.S. bank representing a specified number of shares (or one share) in a foreign stock that is traded on a U.S. exchange. ADRs are denominated in U.S. dollars, with the underlying security held by a U.S. financial institution overseas. ADRs help to reduce administration and duty costs that would otherwise be levied on each transaction. This is an excellent way to buy shares in a foreign company while realizing any dividends and capital gains in U.S. dollars. However, ADRs do not eliminate the currency and economic risks for the underlying shares in another country. For example, dividend payments in euros would be converted to U.S. dollars, net of conversion expenses and foreign taxes in accordance with the deposit agreement. ADRs are listed on the NYSE, AMEX or NASDAQ as well as OTC. In short ADRs make it much easier to buy and sell foreign stocks but what you have is still a foreign stock prone to the benefits or risks of a foreign market and currency. You can buy and hold ADRs or you can day trade them or swing trade them. What are the sources of profit? Currency Exchange Rates One of the ways to profit from foreign stocks is to take advantage of changes in the foreign exchange rate between the stock’s currency and the U.S. dollar, USD. When the dollar is strong many investors look offshore for bargains. There are ADRs for stocks all over the world. When the home currency of the stock you have purchased begins to recover you may see that your ADR of that stock is rising as well. Swing traders can use variations in exchange rates to profit from foreign stocks owned through American Depositary Receipts. There Is Always a Bull Market Somewhere Exchange rates aside it is common that while parts of the world may be in recession, other parts of the world may be doing very well. If you can spot these trends in advance you can buy foreign stocks and ride a foreign economic expansion while the economy stagnates back home. Then when the foreign market peaks you can easily sell your ADR for dollars and find the next bull market. Options trading is also possible in trading foreign stocks with ADRs so that you can leverage your foreign investments and limit risk as well. https://youtu.be/hnRqfqCw9pw
Views: 13313 InvestingTip
How to Invest Your 401k
http://www.profitableinvestingtips.com/profitable-investing-tips/how-to-invest-your-401k How to Invest Your 401k By www.ProfitableInvestingTips.com A great way to save money and defer taxes is with a 401k plan. We consider how to invest your 401k. The limits on how much you can invest tax free each year in a 401k are higher than with an IRA. In the USA a 401k plan is a tax-qualified, defined-contribution pension account defined in subsection 401(k) of the Internal Revenue Code. Money is deducted from a paycheck before taxes and commonly is matched by a contribution from the employer. As of 2013 the maximum pre-tax annual amount allowed for a 401k was $17,500. This money can be invested in a variety of ways and can grow tax free over the years only to be taxed when the individual decides to withdraw, typically at retirement. In some 401k plans a post-tax contribution is also allowed. Post-tax contributions also are allowed to grow within the 401k account tax free until withdrawal. Make sure that you understand how your 401k works and get competent tax advice if you are confused. In this article we have a few ideas about how to invest your 401k. Remember that when you take your money out of your 401k it is taxed as ordinary income so your retirement years when you have no salary are the best times to withdraw your money. How to Invest Your 401k: How It Works When you put your money in a 401k or other tax deferred plan you are dealing with marginal tax rates. This has to do with the amount of tax paid on an additional dollar of income. The marginal tax rate for an individual will increase as income rises. When you put money in your 401k you are taking money that you would invest or save anyway. And you are not taxed for this last bit of income so long as it goes into your 401k. That can be a savings of around 25%. Then the appreciation of your investment in the 401k is allowed to increase without yearly taxes. For example, if you have a dividend stock in your 401k portfolio you will not be taxed on the dividends over the years. Likewise, if you buy a growth stock and then sell it after a big run up you will not pay capital gains on the stock while it is in your 401k. When you do pay taxes, it will be when you are retired and typically in a lower tax bracket. The exponential growth of your investments is substantially better when not taxed until it is taxed just one time on withdrawal. This is why a 401k is a preferred way to save. How to Invest Your 401k: Best Vehicles Always remember that how you invest your 401k versus investments with other vehicles has to do with the tax advantages of deferring taxes until after an investment has exponentially appreciated in value for many years. As an example you would not want to put municipal bonds in a 401k because they are already tax advantaged. In our most recent articles, Invest Your Money, we note that you should pay off credit card debts, purchase a home and have a rainy day stash in the bank before thinking about investing. To a degree this also applies to the first years of how to invest your 401k. Thereafter think of long term growth stocks, hot stocks that you can buy cheap and sell when then they run up and avoid the immediate tax consequences and stocks with a substantial margin of safety. This is because the worst thing that can happen is that you play with your 401k and lose everything. The way to save money on paying taxes on investment income is decidedly not to have any 401k withdrawals on which to pay taxes. http://youtu.be/SC8EwdM45U0
Views: 3960 InvestingTip
How Much Money Can You Make Investing in the Stock Market?
http://profitableinvestingtips.com/profitable-investing-tips/how-much-money-can-you-make-investing-in-the-stock-market How Much Money Can You Make Investing in the Stock Market? By www.ProfitableInvestingTips.com If you are looking to make money in the stock market you need to prepare. You need to develop a plan and you need to pay attention. Assuming that you learn the ropes and apply yourself how much money can you make investing in the stock market? Here are a few examples. A Million Dollars Trading One Stock Our sister site, ProfitableTradingTips.com published an article 5 years ago, How to Make a Million Dollars Trading One Stock. How to make a million dollars trading one stock! This is a great idea if you can do it. Evaluating how this could be done is a good exercise in various methods of trading. How to make a million dollars trading one stock could be relatively easy if one had one hundred million to invest and only needed to make a little over one percent return on investment with your trade in order to keep the million dollars after fees and commissions. For most of us in the real world how to make a million dollars trading one stock will have to start with a substantially smaller investment pool, stocks with significant room for appreciation, and finding ways to leverage our investment. Many learn how to trade penny stocks with this sort of goal in mind. For most investors in the real world making a million dollars on a single stock requires huge growth for the buy and hold investor or huge and repeated volatile price swings for the short term swing trader/investor. A single stock that comes to mind is Microsoft. If you had purchased 100 shares of Microsoft at $21 a share when the company went public you would have 28,000 shares today worth just under $1,500,000 today. And you would be collecting more than $40,000 in dividends every quarter. You can make a huge amount of money by picking the next Microsoft. Smart Investing Over Time in Many Stocks Although the founder of Microsoft, Bill Gates, is the richest man in the world the third richest is Warren Buffett. Buffet turned a textile business into a stock holding company in the 1960’s and turned it into an investing powerhouse. If you had purchased B shares in 1996 you would have seen a seven fold increase in your investment but if you had purchased A shares for $1,000 in 1964 your investment would be worth about $10 million today. Buffet practices buy and hold investing using intrinsic stock value as a guide. He has had many more winners than losers and is considered the most successful investor in the world. Is There a Short Route to Profits? Peter Lynch, the legendary manager of Magellan Fund, tells a story about a delivery man who noticed that one of the companies he delivered to was adding on to their plant. He asked why and was told that they had received a new set of orders and were hugely expanding their business. The delivery man bought the company’s stock for a few dollars a share and was pleased when it went up a thousand fold once Wall Street caught on. The Common Thread Buffet has said that he never invests in a company unless he understands what they do to make money and how that approach will continue to make money into the future. And he never buys at inflated prices. This is basic value investing. Whether it is picking the next Microsoft, riding along with a Warren Buffett or spotting a clear opportunity and taking advantage you can make money investing in the stock market. How much depends on your paying attention, spotting opportunities and taking advantage in a timely fashion. https://youtu.be/jkHqGdwSbuI
Views: 2762 InvestingTip
North American European Free Trade Agreement
North American European Free Trade Agreement By www.ProfitableInvestingTips.com Talk has arisen of a North American free trade agreement. Such a treaty would supplant the current treaty that Mexico has with the European Union and take the place of treaties currently being negotiated between the USA and EU and between Canada and the EU. Canada, the United States, and Mexico have had their own free trade agreement for nearly twenty years. The argument goes that by negotiating a North American European free trade agreement the North American parties could offer seamless logistics and products with components from any or all of the three parties. A North American European free trade agreement, the argument goes would be more competitive than three separate treaties with Europe by nations that already are partners in a giant free trade zone. North America and Europe face increasing competition from Asia. See our articles, Russian Chinese Energy Agreement and BRICS Development Bank Problems. A rational response might well be a North American European Free Trade Agreement instead of separate agreements between each North American state and the EU. NAFTA According to the NaftaNow web site: The North American Free Trade Agreement (NAFTA) is a comprehensive trade agreement that sets the rules of trade and investment between Canada, the United States, and Mexico. Since the agreement entered into force on January 1, 1994, NAFTA has systematically eliminated most tariff and non-tariff barriers to free trade and investment between the three NAFTA countries. It is a formal agreement that establishes clear rules for commercial activity between Canada, the United States, and Mexico. NAFTA is overseen by a number of institutions that ensure the proper interpretation and smooth implementation of the Agreement's provisions. US exports at the beginning of the decade were $248.2 billion to Canada and $163.3 billion to Mexico. These nations have been the top two purchasers of US exports. At the beginning of the decade exports within NAFTA amounted to a third of all US exports. Top exports include machinery, vehicle parts, electrical machinery, mineral fuel and oil, and plastics coming to well over $200 billion a year. The USA exports over $30 billion in agricultural products to its NAFTA partners every year. The European Union The European Union (EU) is both a political and economic union comprised of 27 member states. Unlike North America the EU nations give up a degree of sovereignty in return for membership in the trade zone. EU and North America The GDP of North American nations is around $18 trillion. That of the EU is just under $13 trillion in US dollars. The $31 trillion combined economies of North America and the EU amount to 43% of the world economy (world GDP is just under $71 trillion). The rationale for a combined North American European free trade agreement is clear. Create a free trade zone that includes nearly half of the world economy and stimulate business and economic growth on both sides of the Atlantic. If such a treaty comes to pass it could change international investment strategies for many investors. http://youtu.be/eZLJJLIoJjE
Views: 1600 InvestingTip
Dividend Reinvestment Plans
http://www.profitableinvestingtips.com/profitable-investing-tips/dividend-reinvestment-plans Dividend Reinvestment Plans By www.ProfitableInvestingTips.com If you want to see your investment gains accumulate and exponentially grow over the years, consider dividend reinvestment plans. We recently talked about dividend stocks like utilities when we wrote about stock picks for 2014. Utilities commonly pay handsome dividends and commonly offer dividend reinvestment plans. The advantage of dividend reinvestment plans, also referred to as DRiPs, is that your dividends are automatically reinvested and you receive decimal fractions of stock so that every cent of dividends is reinvested. You do not receive a dividend check but rather a statement that your dividends were reinvested. At the end of the year dividend reinvestment plans send you the appropriate information for your tax returns as well. There is no temptation to spend the dividend check and you will see steady and exponential growth of your investment even if you do not purchase new stock. And with DRiPs there are commonly no fees such as you would pay if you used your dividend checks to purchase more stock. The utilities we mentioned in our 2014 stock picks article were: Southern Company SO Duke Energy Corp DUK Dominion Resource D American Electric AEP Cleco Corporation CNL Entergy Corporation ETR NextEra Energy, Inc. NEE NRG Energy Inc NRG SCANA Corporation SCG TECO Energy, Inc. TE Xcel Energy Inc XEL There are lots of dividend stocks and lots of dividend reinvestment plans. As part of your stock portfolio consider holding conservative stocks that will continue to pay dividends in good and bad economies. Consider dividend reinvestment plans in order to profit from exponential growth of your investments. Screening for Dividend Stocks A quick and handy tool for stock screen is the Yahoo Finance Stock Screener. You can use this tool to screen stocks by sector, price, dividends and more. As a conservative example we choose stocks with a market cap of $10 Billion or more and a dividend yield of 3% or higher. We found Duke Energy Corp, which is in our list of utilities. The company has a market cap of $50.44 Billion and pays a 4.4% dividend. We googled Duke Energy Dividend Reinvestment Plan and found out that their DRiP is you do not pay purchase fees or reinvestment fees and that purchases are made every month. The stock screen in which we found Duke Energy contains ConocoPhillips (80.28B, 4.2%) Cisco Systems (119.43B, 3.4%) Dow Chemical Company (55.59B, 3.2%) Chevron Corporation (218.24B, 3.5%) Dominion Resources (41.34B, 3.4%) Note that Dominion is in our list of utilities. High Dividends Versus Staying Power The companies listed in the screening section have been around for years and are not going away. This is the point of buying dividend stocks and using dividend reinvestment plans. There are higher paying dividend stocks but sometimes the company is paying out huge dividends to disguise an intrinsic weakness in their company. If we apply the same requirement of a $10 Billion market cap but look for a dividend yield of over ten percent the screen gives us two stocks, Annaly Capital Management and Seadrill Limited. Annaly used to sell for $19 a share through most of the last decade and fell by half this last year. Think if it as a 5% dividend stock whose price fell by half and whose dividend may well be reduced as well. When we screen for Seadrill we see an investment article that notes that Seadrill will only be able to sustain its dividend if the current weakness in the oil drilling market improves. http://youtu.be/HA0z-eA8ixE
Views: 5415 InvestingTip
What Will $28 Trillion More Debt Do to China’s Economy?
http://profitableinvestingtips.com/forex-trading/what-will-28-trillion-more-debt-do-to-chinas-economy What Will $28 Trillion More Debt Do to China’s Economy? By www.ProfitableInvestingTips.com China has replaced the USA as the focus of too much debt compared to its gross domestic product. In the last five years Chinese debt levels have accelerated as its economy has slowed. In short, what will $28 Trillion more debt do to China’s economy? Business Insider writes about China debt to GDP. China's total debt is about $28 trillion, larger than that of the United States or Germany. Now the Chinese economy is slowing. But China hasn't stopped adding more debt. About five years ago, Chinese debt levels began accelerating far faster than GDP was growing. In other words, as time goes by China adds more debt and becomes less and less able to pay it off. A good portion of Chinese debt is in state owned enterprises or local government. The general consensus was that this debt was China’s problem and would not affect anyone or anything else. However that has changed. Yesterday the Chinese government again began buying stocks to prop up its plummeting stock market. No one thinks that is sustainable. And my colleague Linette Lopez noted yesterday that there is a capital-flight "doomsday scenario" being floated by BAML which suggests that China only has about a year to a year and a half of currency reserves on hand if it needs to defend a run against the yuan. China’s debt is not just going to disappear by printing money as a lot of China’s business debt is denominated in dollars. So, what will $28 Trillion more debt do to China’s economy? There Goes the Yuan The Communist managers of China’s “managed capitalism” have enjoyed support of the Chinese people because of decades of economic growth. That growth threatens to come to an end and rather than deal with secondary social unrest as factories close and people lose their jobs, China is stimulating its economy at the expense of its currency. Bloomberg Business writes about the People’s Bank of China cutting its reserve ratio. China’s latest easing move signals that shoring up growth is the government’s top priority even if doing so further weakens the yuan or adds to leverage that threatens the longer-term health of the world’s second-biggest economy. The People’s Bank of China said Monday that it’s cutting the amount of cash the nation’s lenders must lock away. That move marked the first time in four months that the central bank has used one of its traditional monetary-easing tools, despite mounting signs of a weaker economy and a stock market in near-freefall. The action came days before Premier Li Keqiang is expected to set the bar lower for gross domestic product with a 2016 target expansion range of 6.5 percent to 7 percent, compared with last year’s goal of around 7 percent. The renewed focus on growth could be at the expense of any effort to rein in ever-increasing debt: Chinese banks extended a record amount of new loans in January. Meantime, the yuan is down 3.6 percent against the dollar since October. In short what $28 Trillion more debt is doing to the Chinese economy is causing more debt, slower growth and a cheaper Chinese currency. The rest of the world will enjoy cheaper Chinese products at the expense of a trade war among low cost producers! Read more in our article, Will Capital Flight Kill the Chinese Economic Miracle. https://youtu.be/IpfhQJbWbyc
Views: 33513 InvestingTip
Deflation Era Investments
http://www.profitableinvestingtips.com/investing-tips/deflation-era-investments Deflation Era Investments By www.ProfitableInvestingTips.com The price of oil is way down and the consumer price index has fallen one percent in the last two months. Everyone is happy to be paying less to fill up their car but economists are concerned about deflation. What is deflation and what are some good deflation era investments? Deflation According to Investopedia deflation is: A general decline in prices, often caused by a reduction in the supply of money or credit. Deflation can be caused also by a decrease in government, personal or investment spending. The opposite of inflation, deflation has the side effect of increased unemployment since there is a lower level of demand in the economy, which can lead to an economic depression. Central banks attempt to stop severe deflation, along with severe inflation, in an attempt to keep the excessive drop in prices to a minimum. The risk of deflation is that producers continually reduce prices in order to maintain market share. This damages businesses running them into bankruptcy and puts people out of work. Deflation discourages investment because investors tend to simply hold on to cash which increases in value as prices go down and property and other physical assets decrease in value. During periods of deflation banks often charge a small interest rate to hold money in a checking or savings account! So cash is in effect a deflation era investment. What are some others? Deflation Era Investments The Wall Street Journal published an article, How to Invest for Deflation. Here are a few do and don’t suggestions. Do not make big purchases with long-term, fixed-rate loans as you will be paying for a long time for a depreciating asset. Do not invest in consumer-good stocks as their ability to raise prices is limited. Do not invest in highly leveraged companies. Do invest in high-quality companies that have had long histories of paying high dividends. Do invest more in high-quality corporate bond and municipal bond mutual funds. Do buy certificates of deposit - but avoid getting stuck in a long-term CD so you can be ready to pounce on the opportunity to enjoy higher interest rates when inflation inevitably returns. A basic aspect of deflation era investments is just when you believe that the economy will correct itself. If you believe that, like with Japan, the deflationary era will last decades you simply want to hold cash, short term bonds and stocks that return cash to you every quarter by way of dividends. If you want to capitalize on a turnaround you need to do your homework and pay attention. When Will Oil Go Back Up? The price of oil will go back up when consumption rises. Consumption will rise when the major economies get healthier. The U.S. Energy Information Administration lists nations by millions of barrels of oil consumed each day. United States (19.0); China (10.3); Japan ( 4.5); India ( 3.5); Russia ( 3.5); Saudi Arabia ( 3.0); Brazil ( 3.0); Canada ( 2.4); Germany ( 2.4); South Korea ( 2.3); Mexico ( 2.0); Iran ( 1.9); France ( 1.8); Indonesia ( 1.6); United Kingdom ( 1.5); Italy ( 1.3); Singapore ( 1.3); Thailand ( 1.3); Spain ( 1.2); Australia ( 1.1) Japan is in and out of recession and Chinese industrial production is cooling off. The European Union is having a hard time getting going after the recession due to its addiction to austerity measures. Brazil's stellar growth has gone south and Russia is suffering from sanctions due to their adventurism in Ukraine. The sum total of consumption by these nations each year is 28.5 million barrels a day. When these nations pick up economic steam it will be time to depart from deflation era investments and look at an inflationary future. http://youtu.be/EffWr16QITI
Views: 1012 InvestingTip
Intrinsic Value of Stock
http://www.profitableinvestingtips.com/stock-investing/intrinsic-value-of-stock Intrinsic Value of Stock By www.ProfitableInvestingTips.com Successful long term investors consider the intrinsic value of stock before buying and when deciding to sell. This approach to stock investing goes back to the black days following the 1929 stock market crash which ushered in the Great Depression. Benjamin Graham taught investors that they did not need to play the market as though they were picking numbers on the roulette wheel. Rather he taught investors to do fundamental analysis of stocks in search of forward looking earnings. At the same time investors learned to consider what features of a stock provided a safety net in times of trouble. This was the margin of safety that some stocks have in the form of money in the bank, unencumbered property, or products that are unassailable in their market niche. Successful stock investing became a matter of thoughtful analysis and not a matter of guess work. What Is the Intrinsic Value of Stock? Think of intrinsic stock value as the fundamental value of the stock. Analyze the stock to determine its price based on predicted future income and then subtract the current stock price. Calculate expected company cash flow and then discount to current dollars. Determining intrinsic value of stock is a discounted cash flow valuation. The key to determining intrinsic value of stock is getting a clear idea of the medium and long term prospects of the business in question. Successful stock investors learn to judge how well a company will manage its assets, products, costs, R&D, and marketing. When the picture is clear an investor can make an informed decision. If the market price is less than the intrinsic value of stock it is time to buy and if one owns the stock and the prices are reversed it is time to sell. A Formula for Calculating Intrinsic Value of Stock Here is the original formula that Benjamin Graham suggested as modified in 1962 and again in 1974. Preceding twelve months earnings per share, EPS A constant of 8.5 representing an expected price to earnings ratio, P/E ratio, for a company that is not growing g being an estimate of long term growth (five years) A constant = 4.4, the average yield of high grade corporate bonds in the early 1960 decade Y = The current yield of AAA corporate bonds V = intrinsic value The formula is as follows: V = (EPS x (8.5 + 2g) x 4.4)/Y Once the investor had determined the intrinsic value of a stock he compares that number to the current market price. Intrinsic value divided by current price is referred to as the Relative Graham Value or RGV. An RGV of more than one indicates a buy and an RGV of less than one indicates that one should ignore the stock or sell if it is already in one's portfolio. Practical Daily Use of Intrinsic Value Stock One needs to adjust the 4.4 value in the equation for current treasury yields. In addition one needs to use a crystal ball to determine when the Fed will cut back on its stimulus program which will send treasury rates up. Inflation is accounted for in the equation by way of treasury yields. To the extent that the Fed becomes far more influential in driving inflation to avoid deflation, devaluing the USD to promote exports, or other politically motivated acts intrinsic value of stock may be more difficult to predict. Nevertheless this is still a valid concept and along with finding the margin of safety of a stock helps long term investors make rational decisions in buying and selling stocks. http://youtu.be/LdjbTNNyfks
Views: 3525 InvestingTip
How Much Can You Make Trading Options?
https://youtu.be/f7wBcd2RBd4 http://www.options-trading-education.com/24444/how-much-can-you-make-trading-options/ How Much Can You Make Trading Options? By www.Options-Trading-Education.com Options offer several benefits to traders. Options are a good way to leverage your trading capital and options are a good way to hedge trading risk. If you are a speculator you trade options to make a profit. How much can you make trading options? There is an interesting article published on Quora.com about how much money on an average you can make trading options. The author is a professional trader and speaks from experience. He speaks from the perspective of a “smaller account” namely $5 million or less as this size of account will not generate trades that move market prices very much. With mostly non-directional short option trades with just enough directional trades to be slightly short to neutral on volatility, it is not uncommon to earn 1.5-3.5%/month. The returns can vary dramatically month-to-month (depends upon how many separate positions you are taking and how much risk you are taking on. Among a handful of other option traders (all using income strategies) I speak to regularly who I consider to be successful career traders (and including my own returns), 15-35%/year seems to be an average range. Personally, for the years I have considered myself a professional trader, my returns have been in the 20-25% range. Professional traders use options trading strategies in which they mix calls and puts and selling and buying. When a trader sells a put or call he can use the premium gained to pay for the purchases of a call or put. Many times the trader finds a situation in which the market is not efficient and offers him a sure profit simply for buying and selling the right combination of calls and puts. Professionals typically engage in non-directional options trading in order to routinely secure a profit no matter where the market is going. How much can you make trading options in this manner? This pro says that making 20-25% per year on trading capital is his experience. How about directional trading? Picking the Right Stock at the Right Time It is possible to make money in options trading without using complex strategies. If you are sufficient information and insight you can make a lot of money when a stock pops up in price. There are out of the money call options on stocks which the market believes are going nowhere. If you pick the right stock you can buy a call option for pennies. Let us say that a $100 stock has an out of the money call option for a strike price of $102. You buy a call on 100 shares for $10 or ten cents a share. The company receives a takeover bid and the share price jumps to $132 a share. You can execute the contract, buy the stock and then sell it. Your profit is $2,990 on a $10 capital outlay. That is a nearly 300 fold return on investment! This can happen but it takes work doing fundamental analysis of stocks and paying attention to the market as such opportunities come and go. Collecting Option Premiums Again and Again People who own stocks sometimes supplement their income by selling calls on the stock. When they pick the right time and price they receive a premium but never sell the stock. This process can be repeated again and again for a few hundred dollars each time.
Views: 837 InvestingTip
Profitable Leaps Trading
http://profitabletradingtips.com/trading-investing/profitable-leaps-trading Profitable Leaps Trading By www.ProfitableTradingTips.com An often used alternative to medium term investment is profitable LEAPS trading. LEAPS is an acronym. It stands for Long Term Equity AnticiPation Security. A LEAPS is an options contract with a two or three year term until expiration. There are for well over two thousand equities as well as nearly two dozen indexes available for LEAPS trading. These are available on the Chicago Board Options Exchange, a branch of the CME Group. An investor can purchase a LEAPS option instead of buying a stock. The price is less and the worst that he or she can do is lose the price of the options contract. In profitable LEAPS trading one can buy calls to lock in investment opportunity or buy puts to hedge risk in a rising stock. As not all trades are successful one must ask the question, how to trades fail in otherwise profitable LEAPS trading? The best way to avoid problems is to develop and follow a trading strategy. That having been said here is more about profitable LEAPS trading. Buying and Selling Puts and Calls in Profitable LEAPS Trading LEAPS options offer the same vehicles as regular options trading, calls and puts. When one buys a call on an equity or equity index with a LEAPS option he or she can purchase the underlying equity at any time up until the expiration date. He or she will pay the strike price, which is the contract price, whatever the price might be at the time of executing the option. Investment risk is limited to the cost of the options contract. Many investors use this approach to leverage their investment capital. If the stock in question rises in price the buyer of a call option can either exit his position and pocket the profits or execute the contract and take possession of the stock at lower than the market price. Profitable LEAPS trading requires that the trader engage in both fundamental and technical analysis of the equities that underlie the LEAPS option. When one buys a put it can also lead to profitable LEAPS trading. Investors who purchase volatile but rising stocks can purchase a LEAPS option to guarantees their gains. The buyer of a put option pays for the right to sell the stock in question at the contract or strike price no matter how far back it might fall. As with a call contract in profitable LEAPS trading, an options trader can exit a LEAPS contract at any point prior to expiration by executing the opposite trade. Selling both puts and calls is often the most profitable LEAPS trading. However, the risk of an occasional large loss typically limits the writing of LEAPS options contracts to large institutional traders and others with deep pockets. In selling LEAPS options the seller gains a profit from the sale. However, he or she also agrees to accept the risk of an unexpected market move. Whereas the buyer of a LEAPS option is under no obligation to buy or sell an equity the seller is, in fact, obligated to sell in the case of a put contract or buy in the case of a call contract. LEAPS Strategies Although techniques such as scalping in day trading can be used on LEAPS the usual reason to buy a LEAPS option is because of the time value of the contract. The more common use profitable LEAPS trading is to take advantage of the extended time frame of a LEAPS option to profit from steady and sure price movement of a stock, instead of betting on a quick market move. For more insights and useful information about trading stocks, options, futures or Forex, visit www.ProfitableTradingTips.com. http://youtu.be/yXWmzK-sgnc
Views: 3960 InvestingTip
How to Make Money in Gold Investments
http://profitableinvestingtips.com/profitable-investing-tips/how-to-make-money-in-gold-investments How to Make Money in Gold Investments By www.ProfitableInvestingTips.com It is possible to make a lot of money investing in gold and it is possible to lose your shirt in the gold market. In times of social and economic uncertainty gold is an attractive alternative to stocks or holding cash. But when the stock market is hot, gold is usually a losing proposition. How to make money in gold investments has to do with timing, your investment time horizon and the vehicle you use to invest. In August of 1999 an ounce of gold was worth $256. At the end of July in 2016 an ounce of gold sells for $1,314. How to make money in gold investment might have been to buy in 1999 and sell today but there is more to the story. Gold versus Stocks Reuters reports that gold slips as stocks rise. This is earnings week for the stock market and both the Federal Reserve and Bank of Japan are meeting. Gold fell on Monday as the dollar firmed and a recovery in risk appetite supported world stock markets near nine-month highs ahead of central bank meetings in the United States and Japan. The world's major economies pledged at a G20 meeting this weekend, dominated by Britain's vote last month to leave the European Union, to use all policy tools available to boost growth. That lifted both shares and the dollar. Spot gold was down 0.7 percent at $1,313.96 an ounce at 1400 GMT, while U.S. gold futures for August delivery were down $9.90 an ounce at $1,313.50. When stocks are hot gold tends to fall. How to make money in gold investments is obviously to invest when gold is weak and sell when it is high. But are there other options aside from buying and selling gold bullion? Gold ETFs Gold ETFs are a reasonable way to buy and sell gold. Investopedia looks at the relationship between gold and gold ETFs. Exchange Traded Funds (ETFs) give traders access to the percentage price movements of physical gold, without having to buy physical gold or futures contracts. Instead, the ETF does this for the investor. Gold ETFs are typically structured as a trust. Under this structure, the ETF holds a certain amount of gold for each share of the ETF that is issued. Buying a share means owning a portion of the gold held by the trust. The advantage of buying shares in a gold ETF is that you do not need to pay for storing your gold bars or endure a wait while you buy or sell and take or give up possession. To a degree holding gold bullion is a doomsday investment while ETFs are how to make money in gold investments without the overhead of holding gold bullion. You simply buy and sell shares of the ETF as you would common stocks. Gold Miners A common rap against holding gold is that it produces no income while you wait. With this thought in mind an alternative to buying gold or shares in an ETF is to buy shares in a gold mining company. Gold mining stocks rise and fall with the price of gold. In fact gold mining stocks typically rise faster than gold itself in a bull market but they also fall faster in a bear market. US News wrote about gold miners at the start of this year as gold started to rise. An interesting aspect of gold mining is that much of it occurs outside of the USA and the costs of operation are in local, and weaker, currencies. Day cautions would-be investors to look at corporate balance sheets of gold miners if metal prices rise. A strong move up in gold can cause the miners with the most debt and highest cost of production to see their stock values rally the most. "A small move in the price [of gold] makes a big difference if your cost of production is marginal," he says. "If you produce gold at $600, your profit doesn't go up much if gold moves from $1,100 to $1,200. But it makes a huge difference if your cost of production is $1,150." How to make money in gold investments includes careful analysis of gold mining operations and selective investments. https://youtu.be/D4UiuQkLpro
Views: 6514 InvestingTip
Investing in Value Stocks
http://www.profitableinvestingtips.com/stock-investing-tips/investing-in-value-stocks Investing in Value Stocks By www.ProfitableInvestingTips.com A good way to make a profit in the stock market is by investing in value stocks. Value stocks are actually undervalued stocks such as in today’s energy sector. Investopedia defines a value stock. A stock that tends to trade at a lower price relative to it's fundamentals (i.e. dividends, earnings, sales, etc.) and thus considered undervalued by a value investor. Common characteristics of such stocks include a high dividend yield, low price-to-book ratio and/or low price-to-earnings ratio. A value investor believes that the market isn't always efficient and that it's possible to find companies trading for less than they are worth. An easy way to attempt to find value stocks is to use the "Dogs of the Dow" investing strategy - buying of the 10 highest dividend-yielding stocks on the Dow Jones at the beginning of each year and adjusting it every year thereafter. Investing in value stocks is not just investing in cheap stocks. Good value stocks pay dividends and/or have high growth potential. These stocks commonly have a very sound business plan and return profits year after year. When there is a market rally value stocks often get left behind as investors follow rapidly growing stocks. However, when the rally corrects or the market reverses value stocks do, in fact, retain their value. Value stocks tend to outperform the overall market over the long term. Picking Value Stocks Investing in value stocks requires that you pay attention to the market. Using stock screens to find low profit to earnings ratio stocks is useful. However, investing in value stocks also requires that you understand just how it is that a company makes its money and how it will continue to do so. Often times this requires an outside the box view of stocks and the market in order to understand how global events and other factors will tend to drive stock prices in the near and midterm future. Forbes provides an example of how to do this in their article about the top ten value stocks that they see in emerging markets. A weak recovery in the U.S. and Europe has helped reduce the price to earnings ratios on a number of large cap stocks in the big emerging markets. Value investors take notice. Here are the top 10 recommendations by stock forecasters at ValuEngine.com. Examples given include AsiaInfo Linkage (ASIA) which is referred to as the backbone of China’s mobile telecom system. A second stock mentioned is the Brazil petroleum giant, Petrobas. And a third is Brasil Foods, the largest food company in Brazil. Each of the ten suggestions in the article is a solid company that is situated in a country with economic issues. The working assumption is that economies will recover and investing in value stocks in Brazil, China, India, etc. will be profitable in the long term as you are picking up deals on what in the long run will be cash cows. The Energy Sector How low will the price of oil stay down? That will be how long energy stocks will remain in the doldrums. Supply has outstripped demand and when producers cut back and the economies in China, Japan and Europe pick up steam oil prices will go up. The New York Times suggests that there is value after a plunge in the energy sector and that several hedge funds are positioning themselves to take advantage. While many investors, including Warren E. Buffett, were selling energy stocks in the final three months of 2014, several hedge funds sought to profit on the turmoil, regulatory filings showed on Tuesday. Third Point, the firm run by Daniel S. Loeb, acquired a sizable stake in the oil refinery company Phillips 66, while Leon G. Cooperman’s Omega Advisors amassed a new position in Laredo Petroleum, and Viking Global Investors, led by Andreas Halvorsen, increased its stake in Cheniere Energy by several million shares. Although hedge funds tend to jump in and out of stocks, long term investors may find opportunities for investing in value stocks that they can buy cheap today and hold forever. http://youtu.be/rGcg4psYqrM
Views: 566 InvestingTip
Three Good Ways to Invest in Mexico
http://www.profitableinvestingtips.com/investing-trading/three-good-ways-to-invest-in-mexico Three Good Ways to Invest in Mexico By www.ProfitableInvestingTips.com Mexico is the 14th largest nation in the world by land mass. Its 115 million people place Mexico in 11th place in the world by population. Mexico has a GDP of over a trillion dollars. When the cost of living in Mexico is calculated in, the GDP of Mexico according to purchasing power parity is just under $1.7 Trillion. As its economy grows there are at least three good ways to invest in Mexico. The first is to focus on Mexican companies through the Mexican stock market. The private sector is increasingly dominant in Mexican society and seaports, railroads, electric generation, natural gas distribution, telecommunications, and airports are all increasingly in the private sector and are investment opportunities. The second of our three good ways to invest in Mexico is to purchase stock Mexican companies listed on American exchanges. This route may be the most comfortable for American investors. The third of our three good ways to invest in Mexico is to do it directly. Foreigners can own real estate in large parts of Mexico. Mining is attractive as the country has rich mineral resources. For those wishing to retire in the sun, property in Mexico is cheaper than in the USA and the cost of living is lower. To a large degree investing in Mexico is like investing in the rest of Latin America. See our article, Invest in Middle Class Growth in Latin America. Now, here is a bit more about three good ways to invest in Mexico. Investing in Mexico via Mexican Stocks One can buy stocks on the Bolsa Mexicana de Valores, BMV, the Mexican stock market. It is the only Mexican stock exchange and is located in the capital, Mexico City. The stocks listed have a total capitalization in excess of $400 Billion calculated in US dollars although stocks are denominated in and traded in Mexican pesos. The BMV is second to Bovespa, the Brazilian exchange, in Latin America in size. Here are a few representative listings of our first of three good ways to invest in Mexico: América Móvil: Telecom Cemex: Cement FEMSA: Conglomerate Alfa: Conglomerate Grupo Aeroportuario del Pacifico: Airports Grupo Bimbo: Food Grupo Modelo: Beverage Grupo Financiero Santander: Retail and Private Banking TV Azteca: Television, Media Televisa: Television, Media Telmex: Telecom Walmex: Retail Mexican Stocks as ADR's For many American investors it is probably easier to look for Mexican stocks listed as American Depository Receipts (ADR's) on US stock exchanges. There are currently 89 Mexican companies available as ADR's. These stocks represent a wide range of industries and investment opportunities. Although there are many US companies that do business in Mexico, the portion of their total business may be small. So as not to dilute the Mexican part of the investment opportunity, the second of our three good ways to invest in Mexico is to stick with Mexican companies but those listed as ADR's. These stocks commonly need to provide the same level of information that American stocks do for the NASDAQ or NYSE. This provides the investor with a sound basis for fundamental analysis when choosing foreign stocks. Investing and Doing Business Directly in Mexico An American investor can do business in Mexico. He or she can own property. However, the job is easier if the investor speaks Spanish and has a good sense of the local business culture. Many investors choose the property route simply because they can buy, give the work to a property management company, and collect rental payments while devoting their time to walking on the beach. This may well be the best of our three good ways to invest in Mexico if you are set to retire. Read Foreign Real Estate Investments for more insights. For more insights and useful information about investments and investing, visit www.ProfitableInvestingTips.com. http://youtu.be/o5jzeuOPAjU
Views: 5002 InvestingTip
Cell Tower Lease Cash Flow
http://www.CellTowerGold.com Cell Tower Lease Cash Flow By www.CellTowerGold.com The best cell tower lease cash flow comes from structuring repeatedly successful deals when you buy cell tower leases and then sell them. If you buy cell tower leases and create cell tower securities you can have cell tower lease cash flow for the long term by simply managing a portfolio of securities. A very conservative approach is simply to buy out the current lease holder and collect lease checks leasing cell tower sites. To develop cell tower lease cash flow you will want to start by taking the online course offered by Cell Tower Gold. Learn how to find cell sites, discover who owns them, efficiently and successfully approach owners, and structure deals. The harder and smarter you work the better will be your cell tower lease cash flow. The more carefully and intelligently you structure deals the more secure will be your cell tower lease cash flow. Read on for more about Cell Tower Gold and how to profit from cell tower leases. Leasing Cell Tower Sites A profitable business opportunity is leasing cell tower sites. Owners of property such as tall buildings or high altitude terrain may be approached by cell phone companies. Phone companies need to place their signal relay stations in high locations. Because of the large number of sites required for a cell phone network and the cost of land, leasing cell tower sites is typically how phone companies fill out their phone grids. Although the original land owner is the person that the phone company approaches for leasing cell tower sites, it is possible to buy cell tower leases from the original owner. The new owner can continue leasing cell tower sites and collect the income. He or she can also profit from flipping these investments. If this sort of investment opportunity interests you, read more about leasing cell tower sites and consider taking the short course offered by Cell Tower Gold. Flipping Cell Tower Leases Develop a profitable cell tower lease flipping formula and enhance your cell tower lease cash flow. The old investment saying is that there is always a bull market somewhere. A profitable cell tower flipping formula can turn assets in plain sight into pure gold. When you have found a cell tower, or two or three, you will want to find out who owns the property and talk to them. Many folks will be perfectly satisfied with their situation and not interested in selling their property or their lease. However, many may be interested and for various reasons. A profitable cell tower flipping formula includes listening, creatively, to the owner of the cell tower site and owner of the lease on the cell tower. A profitable cell tower flipping formula commonly has to do with finding a solution to the current owner's problems. The current owner may have a failing business. Selling his cell tower lease may give him the necessary cash to pay bills, buy new equipment, or do other things to bring his business back to health. Or the same business owner may want to get out, lock stock and barrel. A profitable cell tower flipping formula requires that you listen and find a creative solution to buying the entire property, fixing problems along the way, and having a buyer ready on the other end. Developing this process can lead to healthy profits and over time a great cell tower lease cash flow. For more information about this amazing opportunity, please visit www.CellTowerGold.com. http://youtu.be/ENHwgy6xL8U
Views: 921 InvestingTip
Long Term Investment
http://www.CandlestickForums.com Long Term Investment By www.CandlestickForums.com A long term investment is typically thought to be a stock, bond, or other equity held longer than five years. For income tax purposes a long term investment is one that is held for a year or more and is commonly subject to a different, and lower, tax rate than an investment held for less than a year. Good long term investment stocks will typically have a strong cash flow combined with reasonable stock prices. Investors use the price to earnings ratio as a guide to whether or not stocks have been priced above their intrinsic stock value. If the market has driven a stock price too high its forward looking earnings will not be sufficient to justify its current price. Investors also look for a margin of safety in a long term investment. For example, a company with money in the bank, a low debt to asset ratio, and salable assets will be able to weather stock market crashes when other companies will go bankrupt. If such stocks are well paying dividend stocks as well, they will provide a good return on investment in quarterly dividend checks and appreciation of stock value over the years. In long term investing as well as day trading the use of technical analysis tools such as Candlestick pattern formations allows both investors as well as day traders to anticipate market trends and market reversal in buying stock and selling stock at optimal prices. A long term investment stock portfolio is normally diversified. Diversifying a stock portfolio protects the investor against localized problems in individual market sectors. The stock investing strategy of diversification can also protect the value of a stock portfolio during an economic down turn. This is because certain stocks will commonly go up in price when the rest go down in price. For example, companies selling basic consumer goods such as toothpaste and dish soap keep selling their products during a recession at the same time that families are putting off the purchase of a new car and not flying across the country for their vacation. Thus companies such as Colgate, Clorox, and Proctor & Gamble tend to see their stock prices survive or even go up as others fall in the early stages of a recession. When the investor consults Candlestick chart formations at the beginning of an economic downturn, he will commonly see certain stocks ready to fall and others remaining stable. Using Candlestick analysis the long term investor will commonly watch the fall of stock prices. Buying at the bottom he will profit from picking stocks that were previously overpriced but are now good for long term investment. The successful long term investor wants to hold stocks forever. However, a long term investment is only good so long as it is profitable. The smart long term investor will routinely do both fundamental and technical analysis of his stocks. When the fundamentals show that a stock no longer holds long term promise it is time to consult a visual and easy to read stock analysis system such as Candlestick chart analysis in order to sell stock at the best available prices and move on to a different long term investment. https://youtu.be/-_i-V5WxhOw
Views: 1086 InvestingTip
Hazards of Wholesale Funding
http://www.profitableinvestingtips.com/investing/hazards-of-wholesale-funding Hazards of Wholesale Funding By www.ProfitableInvestingTips.com Does wholesale funding make your financial life safer or riskier? What are the advantages of wholesale funding and what are the hazards of wholesale funding? If you have not been keeping up with the banking news, wholesale funding is how many large banks are now financing their operations and managing banking risk. The traditional means of running a bank is to offer depositors a decent rate of interest to get them to put their money in the bank. Then the bank offers loans at an acceptable and profitable rate of interest, using the money from depositors. Banks have traditionally needed to maintain a currency reserve. This is to protect depositors in case of problems in the bank loan portfolio. When the banking system nearly collapsed in 2008 and 2009, badly constructed loan portfolios hemorrhaged losses and the United States government stepped in with billions of dollars in loans. Along the way credit still dried up and loans for the common person became hard to find. People lost their homes as banks foreclosed. The Federal Reserve has pursued a policy of low interest rates to help stimulate the economy. However, the same low interest rates that help industry leave savers with virtually no return on bank deposits. Savers have to choose between investing in risky stocks or other questionable investments and accepting a negligible return on their banked assets. What banks did next leads to the hazards of wholesale funding. Wholesale Funding Sources Banks that cannot attract enough deposits look for Federal funds, state and municipal funds, advances from the Federal Home Loan Bank, primary credit advances from the U.S. Federal Reserve, deposits from foreign sources, brokered deposits, or money from CD listing services or via the internet. The hazards of wholesale funding are that if this backup system of bank reserves does not work a banking system collapse may be in the works. Fundamental analysis of this way of doing business may lead investors to seek more secure ways to protect their assets. Federal Deposit Insurance The most recent increase passed by congress insures bank deposits up to $250,000 per depositor. However, the reserves of the Federal Deposit Insurance Corporation may not be sufficient in the case of a major collapse. Although the FDIC says that deposits are backed by the full fair and credit of the government, a few billion in cash plus the ability to borrow $500 billion might not be enough in the situation gets really bad. And, it is not clear to what degree the government would step in if FDIC resources are breached. Concerns Voiced by the FED Chairman In a recent speak Fed chairman Bernanke noted that important risks remain in the short-term wholesale funding markets. His concern is how the system at large would respond to the failure of a single broker-dealer or borrower. The sense of this and the hazards of wholesale funding are that credit is to a large degree maintained by accessing other credit. The Federal Reserve is doing continual stress testing to see how the financial system would respond to various stresses. And, according to the Fed chairman, more work is needed to better prepare investors and other market participants to deal with the potential consequences of a default by a large participant in the repo market. He said this in the context of a possible run on money market funds. Where Else Can You Invest or Save Your Money? We wrote some time ago about three good offshore investment ideas. Although it may not be time yet to pack up and leave the good old USA, it may be time to look at investing in foreign stocks, or looking for real estate in growing markets like Panama, Colombia, and Brazil where the hazards of wholesale funding are something that you read about in the international edition of the Miami Herald but do not affect your every day or financial life. For more insights and useful information about investments and investing, visit www.ProfitableInvestingTips.com. http://youtu.be/XCbuw6iXFKM
Views: 1113 InvestingTip
Three Good Offshore Investment Ideas
http://www.profitableinvestingtips.com/investing-trading/three-good-offshore-investment-ideas Three Good Offshore Investment Ideas By www.ProfitableInvestingTips.com The worst recession in three quarters of a century has taken its toll on economies throughout the world. Some have been hit worse than others. Some countries will come back strong. And, some countries never had a recession. With this in mind we would like to present three good offshore investment ideas. There are a number of ways to invest outside of your nation of origin. You can move to another country, seek residency, learn the language and start a business. You can also set up an international business corporation in a foreign jurisdiction, bank internationally, and save you profits in a currency like the Colombian peso which has outpaced all other currencies versus the US dollar in 2012. An excellent alternative to moving away from home is to invest in companies that do business in the growing regions of the world. Think of Caterpillar, Procter & Gamble, and 3M when you looking for three good offshore investment ideas. Our own three good offshore investment ideas come from south of the US/Mexican border. Make money by investing in Latin America, specifically Panama, Colombia, and Brazil. Interested? Read our three good offshore investment ideas. Brazil: Not Just Coffee The leading coffee producer by volume in the world is Brazil. But, Brazil has gotten its economic act together, encouraged investment, developed its technological base, and found oil, lots of oil. Estimates of deep sea oil finds put Brazil's oil reserves at or above those of Saudi Arabia. The country has well-developed agricultural, mining, manufacturing, and service sectors. Brazil's economy dominates of all other South American countries and it is expanding into world markets. Real estate prices have risen along with general prosperity and the middle class is growing and becoming richer. Take a flight to Rio de Janeiro and buy a condo. Watch while your property values rise. Set up a bank account in Brazil and watch your savings grow in Brazilian Reals, the local currency. Or simply buy stock in companies like Caterpillar, Procter & Gamble, 3M, or Marriott who already do business there. These could be three good offshore investment ideas. Colombia: Better Coffee and Now Safer Too Colombia is emerging from a decades-long civil war and making use of its rich resource base, talent, and free trade connections. The nation has free trade agreements with Canada, Chile, Mexico, Switzerland, the EU, Venezuela, South Korea, Turkey, Japan, and Israel. It belongs to the Andean Community and Caribbean Community trade organizations. Colombia is historically the producer of lots of high quality Arabica coffee bearing the Juan Valdez seal of approval of the Colombian Coffee Growers association. Fly to Bogotá, Cartagena, or a city in the coffee growing district, like Manizales and buy property. Like an investment in Rio your real estate investment may well prosper. Likewise, foreigners can do business in Colombia. Or you can invest in oil companies, mining companies, or coffee exporters who do business there and count your dividends. Bank your profits in Colombian pesos and get an extra kick as the peso has outperformed all other currencies versus the dollar in 2012. These could be three good offshore investment ideas. If value investing for long term profits is your thing, think of Colombia. Panama and Passage from Pacific to Atlantic The Panama Canal Expansion will soon funnel much more trade through the old Panama Canal. The country never had a recession after 2008. When things were most bleak elsewhere Panama had a 3.5% growth rate. Buy property along the new metro line, rent to businesses, and bank you rent checks in dollars. Set up an offshore service center using skilled, English proficient workers at "offshore" rates. Or, notice the North American companies that do business here and invest in them. Again, these could be three good offshore investment ideas. In fact, if you are investing for retirement you might just consider a "pensionado" visa and retire to this tropical paradise. For more insights and useful information about investments and investing, visit www.ProfitableInvestingTips.com. http://youtu.be/g4pFgbfSHDs
Views: 1975 InvestingTip
Treasury Notes
http://www.profitableinvestingtips.com/bond-investing/treasury-notes Treasury Notes By: www.profitableinvestingtips.com Periodically congress decides to get into a fight over whether to approve the next budget or not. But rather than work on the issue of an ever increasing national debt before the fact, congress has made a habit of playing chicken with the full faith and integrity of the US government. When another high stakes game of "chicken" on Capitol Hill investors will be wondering what will happen to Treasury Notes (T-notes) if the US does not extend its ability to borrow to fund current expenses. Likewise investors in Treasury Notes may well wonder what the future is for interest rates on Treasury Notes and the value of the US dollar related to foreign currencies if the United States does not effectively deal with its long term debt. Treasury Notes are notes issued by the US government. They have maturities of two, three, five, seven, and ten years and a denomination of $100. Investors can buy Treasury Notes directly from the US Treasury, through a bank or through a stock broker. T-notes are often part of an investment portfolio for a conservative investor. They pay interest every six months until maturity at which time the owner gets back the principal. Treasury notes are also traded as their value fluctuates with prevailing interest rates. Investors can follow short term changes in T-notes and interest rates in general with Candlestick analysis just as they can follow stocks and commodities. It is important to do strict fundamental analysis of all factors involved when investing in treasury notes. Treasury Notes and Fluctuating Interest Rates It is the possibility of unpredictable interest rates that concerns investors and piques the interest of traders. T-notes are a form of interest rate investing. In long term investing a person will commonly purchase Treasury Notes and hold to maturity. In day trading one can follow fundamental analysis of interest rates and technical analysis of the interest rate market with technical analysis tools such as Candlestick pattern formations. In value investing for long term profits investors often wait until interest rates spike and then buy and hold for the long term. The Nuts and Bolts of Treasury Notes Investors and traders of Treasury Notes can place either competitive or noncompetitive bids for notes which are sold at auction or can simply buy them from their broker. Treasury Notes on the secondary market may be selling at a premium or a discount to their par value. T-notes rise or fall in value opposite to interest rates. The uncertainty of the US even temporarily defaulting on its debts has sent the stock market downward and could result in credit rating agencies, such as Standard and Poors, downgrading US debt. A lower debt rating typically drives up the cost of borrowing. That would mean that investors and traders would demand higher interest rates or would not buy T-Notes, thus driving the price up at weekly auctions. Anyone holding older Treasury Notes would continue to receive the same interest payment every six months but the value of their T-note would fall. If interest rates are going to rise in the coming weeks and months traders will be wise to sell T-notes and bonds in advance and buy T-notes or buy bonds when rates have gone up. If the powers that be in Washington are able to deal effectively with the US long term debt we could see a progressive fall of interest rates of Treasury Notes. In such a situation a trader using trading tools such as Candlestick charting to follow rates can purchase T-notes at the top of the interest rate curve and see the value of their T-notes progressively increase as rates fall. Investing in treasuries, like investing in bonds, requires that traders keep a close eye on the fundamentals that drive interest rates and use Candlestick chart formations to follow market sentiment. Smart investors pick profitable investment vehicles. Investing in high interest rate treasury notes and holding for the long term can be profitable. http://youtu.be/-izwxwpYnGo
Views: 4267 InvestingTip
Why Invest in Dividend Stocks
http://www.profitableinvestingtips.com/profitable-investing-tips/why-invest-in-dividend-stocks Why Invest in Dividend Stocks By www.ProfitableInvestingTips.com Why invest in dividend stocks? Dividend stocks are often recommended for those approaching retirement. The rationale is that you get a quarterly dividend check at a time when your income has been reduced. It turns out that investing in dividend stocks can been an excellent strategy for investors of all ages. The prospectus for the Oppenheimer Rising Dividends Fund notes the following: From 1926 through 2013, dividends have represented nearly 43% of the returns generated by the stock market, as represented by the S&P 500 index. Stocks of companies that grow and initiate new dividend payments, [such as those the Fund seeks to own] outpaced other alternatives. What makes these results even more compelling is that stocks with growing dividends have not only outperformed, but have done so with less risk. Why invest in dividend stocks? Companies that routinely pay dividends have good cash flow. They make money because they have a successful business plan. Companies that pay dividends are often easy to understand. They sell products that people want, will buy and will continue to buy into the future. And strong, stable dividend stocks typically are not bargain stocks. So, how do you find a good deal when looking for dividend stocks? Bargain Hunting Dividend Stocks The Street comes to the rescue! The publication lists their ten most undervalued dividend stocks. Dividend stocks often fall off the radars of investors looking for total returns but dividend paying stocks greatly outperformed non-dividend paying stocks from the period from 1972 through 2013. The compound annual growth rate of dividend paying stocks and non-dividend stocks from 1972 through 2013: • Dividend Paying Stocks: 9.3% per year • Non-Dividend Stocks: 2.3% per year Dividend paying stocks have been a better investment than non-dividend paying stocks over the past 40 years. Investing in dividend stocks is not the only strategy that has a long history of outperformance. Value investing has also significantly outperformed the market over long periods. Stocks with the lowest 10% of price-to-book ratios have outperformed stocks with the highest 10% of price-to-book ratios substantially from 1926 through 2013 (an 87-year study). The compound annual growth rate results: • Lowest 10% price-to-book ratio stocks: 12.6% per year • Highest 10% price-to-book ratio stocks: 8.6% per year The first suggested stock in the article is Tupperware. There is nothing glitzy about this company. It has a 14.8 P/E ratio and pays a 4.3% dividend. Read the article for more info. Those looking for solid returns over the decades look for value in well run companies that generate steady and reliable cash flow. That is why invest in dividend stocks. Picking Dividend Stocks Let us say that you are not bargain hunting but simply want the best dividend stocks for your portfolio. CNN Money has an opinion about how to pick the best dividend stocks. Disney (DIS), Starbucks (SBUX), and TJX (TJX) (parent company of T.J. Maxx) show that investing in businesses with increasing dividends and healthy fundamentals can be the key to outperforming the markets in the long term. The importance of dividend growth: According to data from Goldman Sachs, dividend stocks tend to outperform their nondividend-paying counterparts by a considerable margin over time. A $10,000 investment in nondividend stocks in 1972 would have turned into $26,417 by 2013, while investing the same amount in dividend-paying stocks would have resulted in $413,073. The point is to look for dividend growth. Companies that are solid very commonly reward their investors as sales and profits rise. Companies do not like to reduce their dividends so they only raise them when they expect continued strong cash flow. That is why invest in dividend stocks, specifically where dividends continue to go up. http://youtu.be/2dE9uN82Ar4
Views: 2139 InvestingTip
Invest in Argentina
http://www.profitableinvestingtips.com/investing/invest-in-argentina Invest in Argentina By www.ProfitableInvestingTips.com With the recent default by Argentina on sovereign debt payments it may seem a strange time to look at how to invest in Argentina. But, the old adage is to invest when there is blood in the streets. The point of this quote from Baron Rothschild is that when things look their worst that is the time to pick up the best deals. The inversions.gob.ar website from the Argentina Ministry of Foreign Affairs and Worship notes the following: From this website, you can access the Productive Investment Opportunities Database (BaPIP, for its acronym in Spanish), a vital tool designed to connect potential investors worldwide with the wealth of investment opportunities existing in Argentina. On this site you can pick a sector such as agribusiness, a subsector such as stock breeding and a province such as Pampas to start to invest in Argentina. Positive Reasons to Invest in Argentina If you want to invest in Argentina what are the advantages and disadvantages? The economy of Argentina is in trouble and foreign capital will be welcome. And the Argentine Peso has weakened so that things are cheaper there if you bring Dollars, Yen or Euros. Google Finance shows a chart of the ARS versus the USD. Ten years ago an ARS was worth 35 cents and four years ago it was worth 25 cents. It passed the 20 cent mark at the end of 2012 and the 15 cent mark at the end of 2013. As of this writing 1 ARS is equal to 12 cents. A positive reason to invest in Argentina is the weakening Argentine peso. Argentina has rich natural resources. According to The World Factbook, published by the United States Central Intelligence Agency: Argentina benefits from rich natural resources, a highly literate population, an export-oriented agricultural sector, and a diversified industrial base. Although one of the world's wealthiest countries 100 years ago, Argentina suffered during most of the 20th century from recurring economic crises, persistent fiscal and current account deficits, high inflation, mounting external debt, and capital flight. A severe depression, growing public and external indebtedness, and an unprecedented bank run culminated in 2001 in the most serious economic, social, and political crisis in the country's turbulent history. A combination of a rich natural resource base and cheap investments could make it promising to invest in Argentina. Risks of Investing in Argentina A look at the history of Argentine currencies over the last forty years or so shows why one does not want to retain earnings from Argentina in an Argentine currency. Since 1969 Argentina has gone through several currencies and essentially added nine zeros after the decimal point. This is to say that there has been trillion-fold devaluation of the Argentine currency in forty-five years. And Argentina has had the tendency to nationalize foreign industries such as when they nationalized YPF, which was owned by Repsol of Spain. This was shortly after YPF discovered the fourth-largest reserves of shale oil and second-largest of shale gas in the world in the Vaca Muerta field in Neuquén province. Chevron has cut a sweetheart deal to start developing this find as the cost of developing the entire basin will be in the $60 billion range and Argentina will have trouble borrowing from foreign sources due to its history of debt default. http://youtu.be/fHKLyD2pBKE
Views: 1116 InvestingTip
S&P 500 Futures
http://profitabletradingtips.com/trading-investing/sp-500-futures S&P 500 Futures By www.ProfitableTradingTips.com A common means of trading based on economic indicators is to trade S&P 500 Futures. The S&P 500 (Standard & Poor's 500) is a stock market index. The S&P 500 index tracks the performance of 500 leading and publically traded US companies. This index is often considered to be an indicator of the United States economy. The S&P 500 is maintained and updated by Standard & Poor's, who also do ratings of public and private debt. They are a subsidiary of the publisher, McGraw-Hill. The ticker symbols for the S&P 500 are GSPC, INX, and $SPX depending on the market you are trading in. As with many traded equities the index also is traded as S&P 500 futures. The futures trading strategy that one follows in trading S&P 500 futures may be different than what one uses to trade individual stocks. An Index that Tracks the US Economy The S&P 500 index is a composite of 500 stocks. Starting alphabetically with 3M and Abbott Laboratories, it includes Apple and Microsoft, Avon and P&G, Ford, General Electric and General Mills. Not only is the index a measure of the strength of the US economy but it is also a measure of the length and breadth of the US economy. As such, a major gain by Apple, 3M, or P&G will only move the S&P 500 and S&P 500 futures prices a small amount. When there is a market crash the entire S&P 500 falls along with futures contracts on the index. During the same time an individual bank or consumer services stock may rise in price. Trading the S&P 500 and S&P 500 is trading on the ups and downs of the US economy. Futures and Options on Futures As with all futures contracts it is often possible to trade options on those contracts. In trading futures options on the S&P 500 the same fundamental and technical analysis applies as with trading the index or its futures directly. The benefit of buying options on S&P 500 futures is that one limits risk to the cost of an options contract. Calls on S&P 500 futures give the trader the right to purchase a future at a set price no matter how high that contract price might go. Puts allow the trader to sell the futures contract at a set price no matter how low the price might fall. In each case, call or put, a futures trader is not obligated to purchase or sell and will only so if it leads to a profit. As options contracts have value up to the moment of expiration, traders often buy a call or put and then sell in order to limit loss or to insure a profit. In and Out with a Profit Many futures traders never intend to buy or sell the equity on which they are trading futures. This applies to S&P 500 futures as well. The most common approach is to exit the contract by executing the opposite trade prior to expiration. In fact, in profitable futures day trading, one enters and exits contracts throughout the day, taking small profits as able. For more insights and useful information about trading stocks, options, futures or Forex, visit www.ProfitableTradingTips.com. http://youtu.be/zJ9zWkIz3VQ
Views: 3050 InvestingTip
Make Money on Cell Tower Investing
http://www.profitableinvestingtips.com/investing-trading/make-money-on-cell-tower-investing Make Money on Cell Tower Investing There are more investing opportunities in the world than just stocks and bonds. One excellent opportunity right in your neighborhood is cell phone tower investment. Just what are cell towers and how do they translate into investment opportunity? Cell towers or cell sites hold the mobile phone masts (base receiver stations) that connect the mobile phone grid. They need to be placed close enough to each other that a person traveling across the phone grid does not lose his or her connection. That translates to hundreds of thousands of sites across North America, as well as across the world. The phone companies own a small percentage of these sites and lease the rest. A farmer leases half an acre of hilltop. A business owner leases his rooftop. Your local baseball diamond may be leasing space on the light poles for cell sites. Phone companies pay well to lease these sites and lease contracts typically have an escalation clause that increases the lease payment year by year. How Do I Make Money on Cell Tower Investing? There are a number of business opportunities as regards cell towers. If you are a property owner and have a tall building, elevated piece of land, etc. you may be able to lease your property to the phone company for a nice lease payment. However, if you have not been approached you probably will not be. So, go for a drive and look around. Cell sites are everywhere. Go talk to the owner of the property and see if he or she is interested in selling the lease or the property or both. Everyone has a price and if you can help relieve the current owner of a problem you may end up with a cell phone lease payment as part of the bargain. Many make money on cell tower investing by rehabbing properties on which the cell site is located. They sell the property, retain the lease, make money on the transaction, and receive lease payments in perpetuity. Short Term Investments Cell Tower Gold estimates that there are over a third of a million cell phone tower sites in the USA that are available for profitable cell phone tower investing. These are sites that you may well be able to buy, rehab, and resell for a handsome profit. To make money on cell tower investment you will want to learn the ropes. Consider the short course that Cell Tower Gold offers as a good way to jump start this business opportunity. To make money on cell tower investing thing of buy and hold, sub leasing, rehabbing for resale. Buy and Hold You can make money on cell tower investing by simply purchasing the cell tower site and the lease. If your goal is diversify your portfolio of investments this is a viable route. Payments are usually good and typically there is an escalation clause in the lease that will steadily increase your gains over the years. Buy Out the Lease It may be possible to purchase the lease from the owner of the cell tower property. This may include the property or may include the right to lease payments. In the second case you will pay a flat sum for the right to lease payments, in perpetuity. As with buy and hold on the property this a way to diversify your investment portfolio. Just make sure that the lease is not going expire the moment that you make payment. Consider It a Fixer-Upper If you have an eye for real estate you may well spot problems with the cell tower property. If you have a ready solution in mind, you can make money on cell tower investing by purchasing the property, lease and all, fixing the problem and selling with or without the lease for a handsome profit. If you would like more information about this amazing and unique opportunity, please join our mailing list. We will be sending more information over the next few weeks to our newsletter. For more information about this amazing opportunity, please visit http://www.celltowergold.com. http://youtu.be/QZxAaVnMCnU
Views: 3347 InvestingTip
Invest in Cuba
http://www.profitableinvestingtips.com/profitable-investing-tips/invest-in-cuba Invest in Cuba By www.ProfitableInvestingTips.com President Obama is expected to announce that the United States government is going to start on the path to normalized relations with Cuba. This will include opening a US Embassy in Cuba, the first in more than fifty years. According to Voice of America the breakthrough is part of a deal featuring prisoner exchanges and talks about normalizing banking and trade ties as part of a revamp of US-Cuba relations. U.S. Republican Senator Marco Rubio of Florida said the U.S. and Cuba were moving toward normalized banking and trade ties. He also said the U.S. was poised to open an embassy in Havana in the coming months. Our interest is how to invest in Cuba. With this thought in mind let us look at foreign companies that already do business in Cuba. Foreign Companies Doing Business with Cuba Roughly 4,500 companies do business with Cuba. Nations whose companies do business with Cuba include the following: Argentina Ecuador Mexico Australia Finland Morocco Austria France The Netherlands Bahamas Germany Panama Barbados Greece Portugal Belize Guatemala Russia Belgium Guyana Scotland Brazil Haiti South Africa British Virgin Island Holland South Korea Canada Honduras Spain Canary Islands Hong Kong Sweden Cayman Islands Ireland Switzerland Chile Israel Taiwan China Italy Turkey Colombia Jamaica Uganda Costa Rica Japan United Kingdom Czechoslovakia Lebanon Uruguay Dominican Republic Luxemborg Venezuela Denmark Malaysia The U.S. Cuba Trade and Economic Council lists companies by nation doing business in Cuba. A small sampling of some of the companies cited in the international media as currently having commercial activities, or having had some commercial activities, or discussing some commercial activities, with enterprises within the Republic of Cuba. There are currently an estimated 4,500 companies from more than 100 countries that "do business in the Republic of Cuba" within such categories as importing to, exporting from, providing services to, or having investments within the Republic of Cuba. The point being that there are already a lot of nations and many companies with footholds in Cuba. A first step toward investing in Cuba would be to take a look at who is already there and what they are doing to make money. American Companies Doing Business with Cuba According to CNBC there already are US companies doing business with Cuba. In Corpus Christi, Texas, beans are being bagged by the thousands and shipped off to a country that for decades was considered forbidden. That country is, of course, Cuba and the beans being sent there are grown in North Dakota, according to WestStar Food President Pat Wallesen. He not only can, he has. For the past nine years, Wallesen has been filling entire container ships with 10,000 bags of beans at a time. He says the last shipment he sent to Cuba was worth $3.2 million. So, how is this legal with an embargo in place? In 2000, Congress passed reforms to that embargo allowing U.S.-based companies to export approved products to Cuba. And it’s not just beans. In fact, there are hundreds of items on a United States Commerce Department list of goods that can be exported to Cuba. According to AgriLIFE Extension at Texas A&M, U.S. exports to Cuba peaked in 2008 at $711 million, but that number has declined in recent years. In 2010, AgriLIFE Extension says $94.8 million in corn, $99.8 million in frozen chicken and $17.8 million in wheat were exported from the United States to Cuba. If you want to invest in Cuba or do business with Cuba look at what others are already doing and you will be ready when relations are normalized. http://youtu.be/QkEsUXH-mD8
Views: 2477 InvestingTip
Russian Chinese Energy Agreement
http://www.profitableinvestingtips.com/investing-trading/russian-chinese-energy-agreement Russian Chinese Energy Agreement By www.ProfitableInvestingTips.com The new Chinese leader, Xi Jinping, signed a Russian Chinese energy agreement set to provide the still-growing Chinese economy with oil and natural gas for years to come. China has worked hard to secure sources of energy for its economy for years. The thriving Chinese economy and large cash reserves have been indispensable in the success of these efforts. The most recent Russian Chinese energy agreement links the first place producer of oil and natural gas with the fastest growing consumer of energy. The Russian Chinese energy agreement also secures for Russia a larger share of the Chinese market, reducing Russia's reliance on Europe as their main consumer. Although the fundamental analysis of related investment opportunities may be tricky in Russia and China due to poor transparency, there may still be the ability to make a profit for those who pay attention. Cash Flow from West to East Think of it this way. China sells products to Europe and North America, and the rest of the world. China runs a big trade surplus. China spends its money on a big Russian Chinese energy agreement. China takes energy supplies away from Europe. In addition, the Russian Chinese energy agreement includes joint oil exploration efforts offshore from Russia. Price, Always Price According to press reports, all is not well with the Russian Chinese energy agreement. There are smaller nations across the globe where China can gain oil, natural gas, and other resources a bargain basement prices in return for loans and foreign aid. However, Russia still has a larger economy to sell energy products to, Europe. According to press releases the Russian Chinese energy agreement has been agreed upon in its general terms. But, price is still an issue and not all projects may come to completion as the old communist allies haggle over price like the capitalists that they have become. Just Two BRICS out of Five The shape of the world to come is changing. Brazil, Russia, India, China and South Africa are collectively known as the BRICS nations. They have strong and growing economies that are expected to eventually reach the level of both Europe and North America. Gone are the days when first the Europeans and then the Americans dictated terms for economic agreements across the globe. In both of our articles, Three Good Offshore Investment Ideas and Investing in Foreign Stocks, we noted the opportunities of investing offshore. The new Russian Chinese energy agreement is only one example of economic activity and investment opportunity outside of North America. The fundamental issue in investing in these situations is learning and understanding the fundamentals. Because many investors do not speak Russian or Chinese, it is often more efficient and profitable to invest in Western companies that do business in these regions of the world or to invest in foreign stocks listed as American Depository Receipts on US stock exchanges. Such investments can be directly related to big news issues such as the Russian Chinese energy agreements or more often related to the rise of a significant middle class in China, Russia, India, Brazil, and South Africa. For more insights and useful information about investments and investing, visit www.ProfitableInvestingTips.com. http://youtu.be/SkI8D2qiC5E
Views: 402 InvestingTip
Should You Borrow Money in Order to Invest?
http://profitableinvestingtips.com/stock-investing/should-you-borrow-money-in-order-to-invest Should You Borrow Money in Order to Invest? By www.ProfitableInvestingTips.com The stock market keeps going up and anyone not invested is losing out. Right? We have commonly preached about having a cash reserve for living expenses and paying off credit cards before investing in the stock market. But interest rates are low and the S&P 500 has gone up 70% in the last five years. If you simply traded on margin, bought an ETF that tracks the S&P 500 you would have paid around 8% a year on your investment capital. So, should you borrow money in order to invest in stocks? How about other investments like your home? How to Borrow in Order to Invest Canadian Business discusses borrowing to invest. It’s often said that fortunes are built with other people’s money. Like many business clichés, there’s a lot of truth to that maxim. There’s nary an empire around that didn’t get started with borrowed money. Individual investors can take the same approach. Borrowing money to invest, also known as margin or leveraged investing, is an increasingly common strategy in Canada. The appeal is that borrowing allows you to buy more securities than you’d otherwise be able to, magnifying your returns. The downside is just as obvious. If your investment goes south, not only could you lose your principal, but you’ll end up owing more money on top of that. How does investing on margin work? Investopedia discusses buying on margin. Buying on margin is borrowing money from a broker to purchase stock. You can think of it as a loan from your brokerage. Margin trading allows you to buy more stock than you'd be able to normally. To trade on margin, you need a margin account. This is different from a regular cash account, in which you trade using the money in the account. By law, your broker is required to obtain your signature to open a margin account. The margin account may be part of your standard account opening agreement or may be a completely separate agreement. An initial investment of at least $2,000 is required for a margin account, though some brokerages require more. This deposit is known as the minimum margin. So, should you borrow money in order to invest? The best time to get into the market is when it is going up and the worst time is just before it corrects, crashes or simply heads down. If you are going to borrow money to invest you need a clear plan of action. Successful investors use the concept of intrinsic stock value to determine if a stock is likely to be a winner or not. An investor investigates a stock to determine if it is likely to generate returns over the years and if its price reflects that promise. When a stock is underpriced compared to its intrinsic value the investor buys the stock. In this case it might be wise to borrow money in order to invest. However, the wise approach is to sell stocks after a run up in order to reduce or pay off the margin. Thus the remaining stock generates dividends and appreciation without causing you to pay interest on the outstanding margin. Over the long haul paying on margin costs around 8% so you need be invested during a strong market upswing in order for this to work. https://youtu.be/p-FIOOu0SL0
Views: 322 InvestingTip
Realistic Stock Investment Expectations
http://profitableinvestingtips.com/stock-investing/realistic-stock-investment-expectations Realistic Stock Investment Expectations By www.ProfitableInvestingTips.com If you are investing in stocks in order to get a better return over the years than rolling over CDs at your bank you have realistic investment expectations. If you are hoping that your stock investments will put you on Forbes billionaire list you are mistaken. This article has to do with realistic stock investment expectations. In support of this thesis, Market Watch says that investing in stocks will never make you a billionaire. The article starts with the most recent Forbes list of American billionaires. And it looks at the best likely returns on investment by expert investors. What is realistically attainable in the stock market? Buffett is widely regarded to have the best long-term performance of any investor alive today, and over the past 30 years the book value of his company, Berkshire Hathaway BRK.A, +0.30% has grown at a 17.7% annualized rate. Impressive as that is, it’s not nearly high enough to enable you to make it on to the Forbes list - unless you start with a lot of money at the outset. The threshold to make it on to this year’s list, for example, is $1.7 billion. Let’s say your net worth by the age of 30 is $1 million. A 17.7% annualized return from then until age 65 would produce “only” $300 million. More importantly realistic investment expectations are that you will match the average equity fund with a roughly 8% per year growth rate. That will grow your million dollars to fifteen million from age 30 to age 65. Billionaires invest in stocks in order to maintain the purchasing power of what they have earned by founding a company, growing it and taking it public! Expectations and Risk Common wisdom is that you can accept more risk in your investments when you are young because you have time to make up for your losses whereas you should avoid risk as you approach retirement. The Motley Fool looks at investment risk. Before you can invest responsibly, it's important to take a long look at your risk tolerance -- that is, how much volatility are you willing to deal with in the pursuit of investment gains? I wish there was a simple answer to this question, but risk tolerance depends on a variety of factors, including your age, your personality, and why you're investing. Traditionally risk adverse investors buy bonds but in today’s low interest rate environment you can lose a lot of money investing in bonds just before rates go up. Realistic Expectations from the Start Years ago we wrote about learning how to invest. A beginning investor needs to think of having a stable platform from which to invest. Simply speaking this means paying off credit card debt and having sufficient cash reserves for mortgage payments, food, utilities, and other needs sufficient for several months. Realistic investment expectations need to include the possibility of substantial losses in the event of a major market crash, war or social unrest. Having your bills paid off and money in the bank for a few months of expenses is the point from which to start investing. https://youtu.be/ZOdWdx_3gzo
Views: 418 InvestingTip
How Does a Strong Dollar Hurt the US Economy?
http://profitableinvestingtips.com/investing-tips/how-does-a-strong-dollar-hurt-the-us-economy How Does a Strong Dollar Hurt the US Economy? By www.ProfitableInvestingTips.com. A picture of how a strong dollar hurts the US economy comes from the American agricultural heartland. Seeking Alpha notes that the high dollar is raising crop prices and making US farm products less competitive. Consequently farmland prices are falling. Rural bankers remain pessimistic about their local economy, primarily due to the strong U.S. dollar that continues to hamper domestic crops sales on the global market. Respondents in this month's survey suggested farmland prices were declining more quickly than in past months. The Rural Mainstreet Index (RMI) lies in the 40s indicating a slide in business and value. The Farmland price index has fallen from 39.4 to 33.4, a stronger indication of decreasing value. The strong US dollar is hurting the agricultural sector and the banks and small towns that depend on agriculture. Corporate Earnings The strong US dollar is cutting into US corporate earnings. CNN reports that US corporations need to stop relying on a weak dollar for their profits. Although the rise in the value of the dollar has been quite substantial over the past 12 months, it has only been in the last four or five months that the impact of this increase on corporate profits has been felt. The value of the U.S. dollar is expected to stay strong for the near term and even possibly rise higher as the Greek situation in the Eurozone worsens and the Federal Reserve starts to raise short-term interest rates. The issue of falling profits at multinational U.S. companies will eventually become a political problem if the weakness in earnings continues. This situation occurred in the 1980s as the Paul Volcker-led Federal Reserve tightened up on monetary policy, forcing short-term interest rates to post-World War II highs and causing a major increase in the value of the U.S. dollar. The strong dollar makes products manufactured in the USA more expensive in offshore markets and therefore less competitive. Railroads Suffer from Cheap Oil and a Strong Dollar Reuters posted an interesting article about how cheap oil and a strong dollar hurt railroads. Low oil prices and the strong U.S. dollar made for a somewhat painful first quarter for major U.S. railroads CSX Corp and Norfolk Southern Corp, and may continue to weigh on their profits. Both companies derive about a fifth of their revenue from hauling coal, which faces competition from lower-priced petroleum products. CSX, the third largest U.S. railroad, on Wednesday cut its forecast for 2015 earnings-per-share growth to a mid-to-high single-digit percentage range from double digits. Chief Executive Officer Michael Ward told Reuters the reduced outlook reflected the impact of the strong dollar, low oil prices and the weak coal market. Until the price of oil goes up anyone who can use oil or natural gas instead of coal will do so. Because railroads haul coal this is a problem. Likewise, when industry and agriculture sell less overseas due to a strong dollar the railroads haul less freight. When the Federal Reserve raises interest rates later this year it will further drive up the value of the dollar and compound these issues. Likewise economic problems in China, Japan and Europe are likely to weaken their currencies and drive the dollar even higher. http://youtu.be/Rj1-rOCLzkE
Views: 744 InvestingTip
Buy and Sell Cell Tower Leases
http://profitabletradingtips.com/trading-investing/buy-and-sell-cell-tower-leases Buy and Sell Cell Tower Leases Smart traders need not limit their endeavors to stocks, commodities, or Forex. Technical analysis skills are not limited to assessing market sentiment in the online markets. Learning about how to buy and sell cell tower leases is not altogether different from learning about how to analyze for trading a large cap company. Profitable cell phone tower trading starts by learning the basics, step by step. Cell Towers and Leases When you call someone via your cell phone the signal is picked up by a mobile phone mast on a base receiver station. This apparatus is on a tower, on the top of a building, or on a hilltop in the country. A phone company needs many of these to complete a network for any given service area. Because of the cost of buying land, especially in cities, phone companies lease land or space for more than ninety percent of their cell phone receiver stations, the cell phone towers. The profit for a trader in this business is to buy and sell cell tower leases. In all circumstances there is someone who owns the cell tower site and leases the land, rooftop, or tower to the phone company. Not all of these folks will want to sell. However, Cell Tower Gold estimates that around 370,000 of these sites in the USA may be available at the right price and under the right conditions. In addition, there are long term investors who like having this sort investment to round out their investment portfolio. The point, when you choose to buy and sell cell tower leases, is to connect willing buyers to willing sellers. This can be easy and this can require a bit of creative thinking and hard work. Where, Who and How There are cell phone tower sites in your vicinity. You may see them on building tops, hilltops, or even light towers at the local football or baseball stadium. Find out who owns the property and who owns the lease. This can be as easy as placing a phone call. How to buy and sell cell tower leases now becomes an issue of finding willing sellers. Everyone has a price. The point is not to pay a huge amount of money for a cell tower. After all, the lease pays a certain amount and you will only find a buyer for this property and lease if the rate of return on their investment is attractive. Thus you are looking for folks who own property and a cell tower lease and who need or want something. And you will want to develop a network of investors who will pay you to do the legwork and will be willing buyers at a markup that is profitable for you. Creative Solutions When you buy and sell cell tower leases you need to talk to the owner of the property and the lease and find out what he or she wants or needs. You will have the most success with distressed businesses and properties. If you have cash, a good line of credit, or a buyer willing to finance the operation, you can often name a price that is attractive to the current owner, you, and your eventual buyer. Many times when you buy and sell cell tower leases you will get into the business of rehabbing property. This may mean finding renters for a building, selling off parts of a property that are not essential to the cell phone tower lease, finding ways to reduce expenses such as property taxes, and more. For more useful insights into this business consider taking the short course offered by Cell Tower Gold. If you would like more information about this amazing and unique opportunity, please join our mailing list. We will be sending more information over the next few weeks to our newsletter. For more information about this amazing opportunity, please visit http://www.celltowergold.com. http://youtu.be/PJdS4_wrA6c
Views: 1716 InvestingTip
Will Capital Flight Kill the Chinese Economic Miracle?
http://profitableinvestingtips.com/stock-investing/will-capital-flight-kill-the-chinese-economic-miracle Will Capital Flight Kill the Chinese Economic Miracle? By www.ProfitableInvestingTips.com The business news is full of reports and speculation about capital flight out of China. Foreign investment was essential to China’s rapid growth over the last decades. Foreign investors are pulling money out and wealthy Chinese are moving their money offshore. Will capital flight kill the Chinese economic miracle? If so, how does that effect the rest of us? Bloomberg Business writes about the weak spot in China’s $3.3 trillion foreign reserve stockpile. By almost all measures, China’s $3.3 trillion foreign reserves, the world’s largest, look formidable. Except one. Compared with the amount of yuan sloshing around in the economy, a proxy for potential capital outflows, China’s firepower seems limited. The dollar reserves account for 15.5 percent of M2, a broad measure of money in circulation. That’s the lowest since 2004 and is less than levels in most Asian economies including Thailand, Singapore, Taiwan, Philippines and Malaysia, according to data compiled by Bloomberg. The low coverage on the money supply does highlight the risk that the buffer can run down quickly if capital outflows, which approached $1 trillion over the last year through November, accelerate. That is perhaps why China has tightened capital controls and stepped up its defense of the currency to damp expectations of further depreciation, which may lead to more money leaving the country. Rich Chinese who made fortunes as China’s economy grew, are not interested in seeing their wealth depreciate along with the Yuan. So, many are moving money offshore from China. This flight of capital drives down the value of the Yuan versus the US dollar making it more urgent for other wealthy Chinese to convert their wealth into dollars, yen, Euros or British pounds. $3.3 trillion foreign reserve stockpile is huge unless you consider that half a trillion was spent last year supporting the value of the Yuan and several hundreds of billion more were spent propping up their stock market. Capital flight is a symptom of China’s problems and a contributor to more trouble. But, why should we care? Capital Flight from Developing Nations Capital flight is not just limited to China. According to the South African Rand Daily Mail there is a trillion dollar exodus from emerging markets. More than a trillion dollars of investment flows has fled emerging markets over the past 18 months but the exodus may not even be halfway done, as once-booming economies appear trapped in a slow-bleeding cycle of weak growth and investment. While developing economies are no stranger to financial crises, with several currency and debt cataclysms infecting all emerging markets in waves over recent decades, leaders gathering for this year's World Economic Forum in Davos in the Swiss Alps are fearful that this episode is much harder to shake off. Seeded by fears of tighter U.S. credit and a rising U.S. dollar, and coming alongside a secular slowdown of China's economy and an implosion of the related commodity 'supercycle', there's growing anxiety that there will be no sharp rebound at the end of this downturn to reward investors who braved out the worst moments. Many emerging economies such as Brazil have suffered greatly as China’s economic miracle has slowed down. Brazil is in a recession as bad as the Great Depression. The issue for North America, Europe and Japan is that when business slows across the globe no one has any money to invest or import foreign products. As capital flight kills the economic miracle in China and elsewhere advanced economies suffer as well. https://youtu.be/Z--LKZDp66M
Views: 1532 InvestingTip
Investment Opportunity Today
http://www.ProfitableInvestingTips.com Investment Opportunity Today By www.ProfitableInvestingTips.com Where does one look for a promising investment opportunity today in our uncertain world? Investing in Russia was promising as the nation emerged from the grips of nearly four score years of Communism. Seemingly depleted oil fields came back to life with Japanese and Western technology and now the area of the former USSR is the world's largest oil producer. But, for an investment opportunity today this chance for profits is past. Often the best investment opportunity today is in areas that are overlooked or avoided because of economic or political chaos. North Africa and the Middle East come to mind here as well as the famous Blood in the Streets quote. Civil war in Libya, unrest in Syria, a brief ray of hope as the strongman of Yemen exits the country for treatment of wounds in Saudi Arabia. Any rational investor will typically avoid chaotic situations where money can disappear in an economic heartbeat. However, the best investment opportunity today is often in just those locations where chaos reigns, such as Middle East investment right now. In this regard an investment forum by Abu Dubai in China is promoting direct foreign investment by Chinese companies in the Persian Gulf and in Abu Dubai specifically. The argument put forward by the presenters of the forum is that there are already 300 Chinese companies doing business directly in Abu Dubai due to its business friendly environment and central location in the Arab and oil rich world. The point of this is that not all regions in the Middle East are unstable and not all companies doing business in and making profits from the Middle East and North Africa are located in these potentially unstable locations. The best investment opportunity today for Africa or the Middle East may well be a company located in the USA, Japan, Euro, or China looking to increase its presence in these areas. Careful fundamental analysis of first world companies doing business in the Middle East may be the best step towards exploiting the best investment opportunity today in the war torn and politically unstable Middle East and North Africa. The general downturn in manufacturing from China and Japan through Europe to North America has many investors scared. May are concerned that as the second huge US stimulus program runs its course that the lack of cash infusion will allow the recession recovery to wither and die. Hidden among the many companies that are cutting on orders and reducing production may well be the most profitable companies of tomorrow. While the doomsayers forecast another Great Depression the alert investor is picking new winners, through investment opportunity today and for the profits of tomorrow. As always we are not necessarily promoting Middle East investment or any specific company in which to invest. However, the alert investor is always on the lookout for investment opportunities. By combining sound fundamental analysis with technical analysis of market pricing an investor can often buy underpriced stocks which have good long term intrinsic stock value. For more insights and useful information about investments and investing, visit www.ProfitableInvestingTips.com. https://youtu.be/BFBV2KPOF4A
Views: 660 InvestingTip
Best Investment Newsletters
http://www.profitableinvestingtips.com/stock-investing/best-investment-newsletters Best Investment Newsletters By www.ProfitableInvestingTips.com Many successful investors subscribe to investment newsletters. What can an investor learn from a good newsletter? And, what are the best investment newsletters? MarketWatch offers advice on this subject with their article, 10 Investment Newsletters to read besides Buffett’s. How far back does that tradition extend? In the U.S., it dates at least to the 1800s. The Wall Street Journal itself began as an investment letter in 1883, when Charles Dow and Edward Jones inaugurated “The Customer’s Afternoon Letter.” Dow and Jones changed their service’s name to Wall Street Journal in 1889. (Dow Jones also is the publisher of MarketWatch.) This is more than just a historical curiosity. Of the 200 investment letters whose performance is monitored by the Hulbert Financial Digest, no fewer than 10 have outperformed Buffett over the past 15 years - since the top of the Internet bubble, in other words. In addition, each of those 10 can boast of something else besides superior performance: They are published at least monthly, if not more frequently. None of them makes you wait a whole year, as Buffett does, to get updated insights. The newsletters listed by MarketWatch are these: Nate’s Notes; Turnaround Letter; Investment Reporter; The Prudent Speculator; Sound Advice; Investor Advisory Service; Investment Quality Trends; The Buyback Letter; Morningstar StockInvestor; Utility Forecaster Assuming that you strictly followed the advice of the newsletter the best return on investment over the last fifteen years would have been from Nate’s Notes. Does this make it the best of investment newsletters? The factor common to each of the ten best investment newsletters is that they all look for value in depressed stocks. Long Term Profits The focus of the MarketWatch article is on newsletters that recommend investing based on long term value. Is this the best approach to investing or is a short term in and out approach more profitable? There are certainly investments that pay very well over a very short term. The problem is finding these opportunities and not losing money on any of them while waiting for the big payoff. Interestingly, USA Today carries an article by Motley Fool in which the best single stock to own is said to be Warren Buffett’s company, Berkshire Hathaway! In other words do not just read Buffet’s newsletter but rather invest in his company. In my opinion, the single best stock you can own is Berkshire Hathaway (BRK-A) (BRK-B). Simply put, buying Berkshire is like getting a well-diversified investment portfolio that's managed by some of the greatest minds in the investing world. Berkshire offers the only way that you can invest in companies including Geico, NetJets, and more than 50 other fully owned subsidiaries, many of which are national brands. And Berkshire's stock portfolio is a long-term investor's dream, with such favorites as Johnson & Johnson, ExxonMobil, and Wells Fargo, just to name a few. Further, I can't think of anyone I would trust more than Warren Buffett and his team of stock-pickers to invest my money wisely. A good point is that Berkshire Hathaway has several fully owned subsidiaries and the only way to invest in them is to invest in Berkshire Hathaway. Is Value Investing Conservative Investing? Value investing is based on solid fundamental analysis. If you are too conservative and afraid of changing your portfolio you may miss out on great long term profits. Money Morning suggests that investors exploit oil’s current low. If you've been eyeing a new gas-guzzling SUV as your next vehicle, you may want to reconsider that Prius once more. That's because today's low gas prices won't be around forever and oil prices aren't about to "tank" any time soon. In fact, the oil price crash has created a state of "contango," a market anomaly that savvy investors can exploit. It's presenting a rare market opportunity to profit that only comes around once every few years. These guys are not on the MarketWatch best investment newsletters list but their advice would seem to be sound. http://youtu.be/EzhW_eXuA-0
Views: 2143 InvestingTip
Investing Tips for the Next Global Recession
http://profitableinvestingtips.com/stock-investing-tips/investing-tips-for-the-next-global-recession Investing Tips for the Next Global Recession By www.ProfitableInvestingTips.com All of the worries about an overextended stock market seem to be coming true. This is especially the case with the weakening Chinese economy, falling stock market and a contagion that has spread from East to West with the rising sun. As things continue to worsen this may be an appropriate time to talk about investing tips for the next global recession. Let us look at what is happening, what is likely to be next and then some profitable investing tips for the next global recession. The Great Fall of China The New York Times reports on the market upheaval occasioned by further losses in the Chinese market. Stocks in the United States tumbled on Monday morning as another sell-off that started in China led to a cascading effect around the world. Immediately after the opening bell in New York, the Dow Jones industrial average dropped more than 1,000 points, or more than 5 percent - one of the most precipitous such plunges in recent years. The indexes pared back much of their early losses, but at midday the Dow was still down about 1.2 percent after hitting lows reached on Friday. Trading remained volatile throughout the day. Investors’ concerns over China’s economic slowdown and a souring view of emerging economies have rattled financial markets around the world in recent days, and showed no signs of letting up. The Dow is now down 9 percent since the start of the year while the broader Standard & Poor’s 500-stock index is off 6.4 percent since Jan. 1. What was a concern about slowing Chinese growth and its effect on emerging market raw material suppliers has turned into a concern that now only is China selling less to the world but is buying fewer raw materials as well as fewer finished products. Investing Tips for the next global recession will have to do with all markets from East to West. Stability versus Recovery How bad will the markets get? Where will the damage be the worst? Who will continue to prosper despite a recession? And, what stocks and other investments should an investor consider as bargains once the markets have corrected? For example, when will oil stocks bottom out and how well will they recover? The Wall Street Journal, MoneyBeat, looks at energy stocks. The price of oil plunged on Monday amid a broad commodities selloff, as sharp declines in Chinese equities and concerns about global economic growth prompted investors to sell crude down to its lowest levels in over six years. The global oil benchmark, Brent crude, fell 2.6% to trade at $44.26 a barrel on London’s ICE Futures exchange. Oversupply remains the overarching factor weighing down global crude prices, with record oil production from key producers like Saudi Arabia and expectations of higher Iranian oil exports following its recent nuclear deal. U.S. oil prices are being dragged lower as its shale-oil producers remain surprisingly resilient in the face of the falling market. Oversupply meets weakening demand which will keep oil prices low for months or a year or longer. Investing tips for the next global recession probably should not include energy stocks just yet. What Does the Expert Do? It is said that Warren Buffet’s first rule of investing is not to lose money and that the second rule is not to forget the first! Boring but steady safe haven stocks are part and parcel of the portfolio of the most famous investor in the world according to 24/7 Wall Street. As of his last 13D filing Buffett owned some stocks that have had boring but steady performances in recent years but are not parts of market bubble that has grown in the past two years. However, these are stocks in companies that are decades old, in many cases have good yields, a history of solid earnings and iron-clad balance sheets. When the market is in a turmoil the best investing tips are probably to go to safe stocks, especially consumer stocks, that will maintain their value as the high flyers take headers. Cash in Euros, Dollars, Yen or Swiss francs is not a bad idea if you want to skip the stock market entirely. And, along the way, the world economy will start to recover like it always does and there will be bargains for those who pay attention. https://youtu.be/SfvWfttAa9Y
Views: 1286 InvestingTip
How to Invest in the Energy Sector
https://youtu.be/bouXs9ZumNA http://profitableinvestingtips.com/investing-tips/how-to-invest-in-the-energy-sector How to Invest in the Energy Sector By www.ProfitableInvestingTips.com The energy sector has taken a beating since the plunge in crude oil prices. Eventually all markets bottom out and there are profits to be made on the rebound. The question is how to invest in the energy sector in preparation for an eventual recovery. According to Investopedia the energy sector is a stock category that relates to producing or supplying energy. This sector includes companies involved in the exploration and development of oil or gas reserves, oil and gas drilling, or integrated power firms. Performance in the sector is largely driven by the supply and demand for worldwide energy. Energy producers will do very well during times of high oil and gas prices, but will earn less when the value of energy drops. Furthermore, this sector is sensitive to political events, which historically have driven changes in the price of oil. A broader definition of companies providing energy is the energy industry. Although the prices of stocks in this larger definition are affected by the price of crude oil these are not all oil-related stocks. Here is a wider breakdown of the energy sector. Petroleum Industry: Oil companies, petroleum refiners, fuel storage and transport services, gas stations, oil exploration companies, companies that supply technical equipment such as for inspecting deep water drilling platforms Gas Industry: Companies involved in natural gas exploration, drilling and extraction, coal gas manufacture, storage, transport and sales Coal Industry: Coal mining companies, transport (railroads) Nuclear Power Industry: Companies that design, build and maintain nuclear power plants, uranium mining operations, spent fuel storage facilities Renewable Energy Industry: This category includes the building and maintenance of hydroelectric dams, wind and solar power facilities, biodiesel and corn alcohol operations, energy extraction from biomass such as vegetable or animal waste Research: Government funded or assisted projects such as attempts to develop nuclear fusion as a practical energy source How to invest in the energy sector will depend on where the market is in terms of the price of crude oil and the efficiency of other sources of energy in comparison. The production of so-called gasohol from corn is a case in point. The Rise and Fall of Gasohol How to invest in the energy sector can be to find an alternative fuel that is competitive with gasoline. Such is the story of gasohol. Gasohol is mixture of one part ethanol (grain alcohol) and nine parts of unleaded gasoline. This product was viewed as a God send in the America corn belt where it was expected to greatly increase the market for corn. When oil prices rose corn-produced alcohol became more competitive and the likes of Bill Gates were investing heavily in alcohol production and gasohol mixing facilities. Many of these turned out to be bad investments when the price of oil plummeted. According to AG Professional corn prices are going down next year even though more corn is going to ethanol production. Corn used to produce ethanol is projected 50 million bushels higher than in 2015/16 with a reduction in sorghum use for ethanol and higher expected ethanol blending. Exports for 2016/17 are projected 175 million bushels higher than this month’s upwardly revised projection for 2015/16. More competitive prices and reduced supplies and competition from Brazil support gains in U.S. exports for 2016/17 and 2015/16. U.S. corn ending stocks for 2016/17 are projected at 2.2 billion bushels, up 350 million from the 2015/16 projection. Investing in any part of the energy sector requires that you learn the details. In short, when the price of oil goes up all parts of the energy sector prosper and when oil falls all parts of the energy sector feel the pain.
Views: 600 InvestingTip
Long Term Investing In Pharmaceuticals
Long Term Investing In Pharmaceuticals By ProfitableInvestingTips.com Long term investing in the pharmaceutical industry has generally led to excellent returns. The standard advice over the years has been to buy "big pharma" and watch your shares rise in value while you collect dividends. In the last twenty or more years the number of new technologies being applied to treatments has grown exponentially. A question for long term investing is whether investment in one of the larger companies is your best bet or if a little homework and investment timing will allow you to take part in the early growth of new companies associated with new technologies. Long Term "Buy and Hold" Investing in Pharmaceuticals The names may change with mergers and acquisitions but the basic nature of the game in big pharmaceuticals stays the same. A company develops a medicine and then holds the patent for a few years while it recoups its investment costs and takes a healthy profit. Typically the Mercks, Lillys, and Glaxos of the world will find a variation on a current medication and develop that variation in order to extend their patent rights and profitability. Because of competition from generic drug makers when a drug goes off patent the major pharmaceutical companies need to be active in research or acquisitions in order to have a stable of profitable drugs to sell. "Buy and hold" long term investing in pharmaceuticals presupposes that the big pharmaceutical company will keep replenishing its stable of profitable drugs. Because of the increase in new technologies in the pharmaceutical world, a well run pharmaceutical giant can continue to be a cash cow into the distant future. The question for long term investing in pharmaceuticals is whether a little diversification, homework, and investment timing might not pay off even better than less thoughtful long term investing strategies. Long Term Investing in Pharmaceuticals with Investment Timing Much of the basic research in pharmaceuticals occurs in small startup companies. For long term investing to succeed in this realm one needs to be lucky, to be very diversified, and to do one's homework. On this page we suggest homework and investment timing. The obvious point is that you want to get in at the lowest reasonable price. In the United States there are a number of tests that a drug must pass in order to be approved for use by humans. Here is where investment timing for long term investing comes in. The point here is to get familiar with the testing process, namely New Drug Applications plus Phase One, Two, and Three trials as well as Phase Four when required. Stock prices fluctuate greatly just before the results of one of the drug trials is about to be announced. For long term investing the point is not to jump in and out of a stock but to time your purchase by putting in a well researched buy order. Long term investing in a winning company can lead to excellent returns. There is no reason why one should lose out on a four-fold gain at the beginning because of poor investment timing. Another advisory is that drug startups are very technical. It is wise to do your reading and to stick to one or two technologies. Long term investing in this area can be very lucrative. For example, patentable stem cell cures for diabetes, degenerative joint disease or Alzheimer's disease will make a lot of people very rich as well as provide new lives for millions, if not billions. For more insights and useful information regarding investments and investing, visit www.ProfitableInvestingTips.com. https://youtu.be/7zOqQ2M9a50
Views: 1599 InvestingTip
Buy Cell Tower Leases
http://www.options-trading-education.com/7099/buy-cell-tower-leases/ Buy Cell Tower Leases A potentially very profitable business venture is to buy cell tower leases. Cell phones are part and parcel of everyday life. The relay points in the cell phone network, the base receiver stations, are essential to smooth functioning of the mobile phone network. These base receiver stations are located at strategically placed, high, locations to assure that the network has a strong signal throughout. Phone companies pay to use rooftops of tall building and plots of land on hill tops, ridgelines, and mountain tops. These companies rarely purchase the land or space; they lease it. If you buy cell phone tower leases you buy into a long term income stream. You can, in fact, buy cell tower leases and then sell them again and pocket the profit. Where Do You Find Cell Phone Towers? Are you at the local baseball diamond? Look up. There just might be a cell phone relay attached to one of the light towers. Driving in the country? You might see them on hill tops. In the city you will certainly see these on the tops of tall buildings. If you are going to buy cell tower leases you need to find the cell towers first and then you need to find the owner of the lease, find out what he is getting, and decide what you are willing to pay to buy cell tower leases. An Ongoing Income Stream Cell phone companies lease a spot of land, space on the top of a building, etc. to place a cell phone tower or just the necessary equipment if the spot is high enough. The owner of the property receives a lease payment on a monthly basis although payment could be quarterly or even yearly. Owners of tall buildings lease roof top space and farmers lease hill tops. This practice provides a constant income stream over the years. Buying Leases A cell phone towel lease is a contract with value. There will be a rate of return on investment. Compare that to other investments that interest you and see if you want to buy cell tower leases. You will typically pay the current owner of the lease, usually the land owner, a flat sum and then assume ownership of the lease and receive payments from the user of the tower. When Is It a Good Idea to Buy Cell Tower Leases? Like any investment, a cell tower lease can be a good deal or a bad one. The lease should have some time to run and a dependable income stream during that time. If it is renewable it would be nice if you could negotiate favorable terms. It will important to have the ability to extend the lease and to have control over it into the indefinite future. It will also be a good idea to pay as little as possible for the investment. Always compare such investments to others with which you have experience in order to decide if it will pay. When Is It a Bad Idea to Buy Cell Tower Leases? If a cell tower lease has a short while to run and pays poorly you certainly do not want to pay a large sum of money for it. If it is uncertain if the company will renew the lease at the end of the contract period you will not want to pay the current owner on the basis of an ongoing income stream. If you are uncertain about how to proceed but the idea of buying cell tower leases appeals to your consider talking to someone who knows, like the folks at Cell Tower Gold. If you would like more information about this amazing and unique opportunity, please join our mailing list. We will be sending more information over the next few weeks in our newsletter. For more information about this amazing opportunity, please visit http://www.celltowergold.com http://youtu.be/tKsKnTTj-44
Views: 1008 InvestingTip
Invest in the Hong Kong Stock Market
http://www.profitableinvestingtips.com/stock-investing-tips/invest-in-the-hong-kong-stock-market Invest in the Hong Kong Stock Market By www.ProfitableInvestingTips.com. The Hong Kong stock market is at a seven year high. Reuters talks about money inflow hopes as China allows mutual funds to invest in the Hong Kong exchange. Hong Kong's bull kept raging on Monday, with the benchmark Hang Seng Index jumping nearly 3 percent to fresh seven-year highs on expectations more money will pour in to hunt for bargains. Brokerage BOC International forecast that about 100 billion yuan ($16.09 billion) will be raised by mainland fund managers and become available for Hong Kong investment as early as May. China recently allowed mutual funds to buy Hong Kong stocks under the Shanghai-Hong Kong Stock Connect scheme. On Monday, investors are also encouraged by a report in Hong Kong's Oriental Daily that speculated that the daily quota for Hong Kong stock purchases by mainlanders under the Connect scheme will be nearly quadrupled to 40 billion yuan. Is it time to invest in the Hong Kong stock market? The hype in Hong Kong is that Chinese investors will find cheap valuation and more in Hong Kong. Another reason for mainland investors to want to invest in the Hong Kong stock market are plunging real estate prices and dwindling exports. Simply put there may be better ways to make money than investing directly in mainland China these days. Is This the End of the Chinese Economic Miracle? Over the last forty years China has mimicked the economic experience of the United States in the latter half of the 19th century. China routinely experienced ten percent economic growth or better. Now economists expect China to be happy with seven percent growth this year and perhaps five percent growth by the end of the decade. The Wall Street Journal weighs in on weak first quarter growth in China. According to data released Monday by the General Administration of Customs, Chinese exports fell 15% and imports fell 12.7% last month in dollar terms as weak domestic and foreign demand weighed heavily on Chinese factories. Beijing faces growing pressure to pare interest rates, cut bank reserves and increase government spending following a string of weak property, industrial production and other economic data in recent weeks, said Mizuho economist Shen Jianguang. He said he expected first-quarter growth to be around 6.8% or 6.9%. “But the real fundamentals, industrial production, could be even weaker,” Mr. Shen added. The point is that there may be better places to invest right now than in mainland China. To invest in the Hong Kong market will give investors another more viable option. What Are the Problems in China? The Australian looks at the Chinese economy from the viewpoint of how Australia will need to look offshore as demand for raw material exports to China diminishes. China’s 2014 GDP growth rate of 7.4 per cent was the lowest since 1990, and is forecast to drop to about 7 per cent. The long-term factors behind slower growth for China include: China’s ageing population and a shrinking workforce. Rising real wages, as regional and sectorial labor shortages enhance labor bargaining power. Over-capacity in many Chinese industries, as a long-term consequence of policies that have favored investment ahead of consumption. Visible pollution of air, water, soil, food: resistance from consumers and residents increases, and pollution control will mean higher costs for many companies. As a first step many Chinese may choose to invest in the Hong Kong stock market. Other investors may wish to look totally outside China for investment opportunities. http://youtu.be/VtACcYjfZSI
Views: 1773 InvestingTip
Are We Falling into the Next Great Depression?
http://profitabletradingtips.com/profitable-trading-tips/are-we-falling-into-the-next-great-depression Are We Falling into the Next Great Depression? By www.ProfitableTradingTips.com Why didn’t the 2008 market collapse lead to another Great Depression? And are we rather falling into the next Great Depression now with rock bottom commodity prices? The Globe and Mail discusses the great depression in commodity prices. The focus is on the Canadian economy but the lessons learned apply across the world. To understand the perils facing the Canadian economy today, think about the plight of prairie farmers in the 1930s. They were selling their crops to markets at rock-bottom prices - it was the great depression in commodity prices that gave the era its name - and they could not earn enough to pay their bills. As prices for their goods continued to sink, the burden of their debts increased absolutely. That is why price depression, or deflation, is a recipe for hard times. The good news about falling prices in the 1930s was that food became very cheap at the grocery store - just as gasoline is now very cheap at the pump. All well and good for those of us with jobs and steady incomes; no help at all to those whose livelihood is being erased. If the script stays true to form, the next two scenes are, first, attempts by countries to achieve competitive advantage by devaluing their currencies - watch China; and second, the development of financial pressures as producers are unable to meet their debt obligations. Then we have bankruptcies and repudiations. In 2008 it was the failure of private corporations, such as Lehman Brothers, that caused a global crisis. What will happen when whole petro countries, such as Venezuela and Nigeria, slip toward chaos? In his poem, The Hollow Men, T. S. Elliot finished by saying, this is how the world ends, not with a bang but a whimper. If we are falling into the next great depression it is not with the bang of another Lehman Brothers bankruptcy but rather with whole nations sliding out of the world economy and into social disruption. The Third Leg of the Global Financial Crisis The Financial Times writes that the global economy is teetering between a continued slow recovery and a slide into a third leg of the global financial crisis. The sharply contrasting outcomes highlight the uncertainties surrounding the global outlook in 2016 amid fears of a slowdown in China, plunging commodity prices and high levels of corporate US dollar-denominated debt in emerging economies. Economists said the instability threatens to exacerbate the vulnerability of households and companies, which are already responding to disruptive technological changes. However, what has hitherto largely gone unnoticed in this debate is that digitization will also wipe out jobs in emerging markets countries such as China and India. And UBS’s economists argue that this displacement could be more - not less - intense in the developing world since their economies rely more heavily on low-skilled work that can most easily be replicated by robots. Are we falling into the next Great Depression? There are many problems besides slower growth in China, depressed commodity prices and war in the Middle East. Recently we posed the question if defensive stocks are really safe. If worse comes to worse the best refuge will probably be cash as Euros, British pounds, Swiss francs, American dollars or yen. https://youtu.be/9DB5rSqG92g
Views: 1624 InvestingTip
Municipal Bond Investment
http://www.profitableinvestingtips.com/bond-investing/municipal-bond-investment Municipal Bond Investment By www.ProfitableInvestingTips.com Municipal bond investment may be an attractive option for investors in the coming year. When the Fed eventually cuts its quantitative easing stimulus plan rates will go up. That will make bonds attractive. However, with higher interest rates come higher taxes. Municipal bonds have the advantage of not carrying a Federal Tax burden. Municipal bond investment may be a good conservative version of today's value investing. Municipal Bonds A municipal bond is issued by a municipality. That is local government or government agencies, not the state or federal government. Issuers can include school districts, airports, utilities, and more. The bonds can be a general obligation of the municipality to repay or may be tied to an income stream such as taxes assessed at an airport, or property tax assessed to support a school district. What makes municipal bonds attractive to those in high tax brackets is that their interest is typically exempt from federal taxes and often free of state or local taxes as well. When an investor looks at the return from taxable corporate bonds or dividends on dividend stocks he or she will calculate the return on investment after taxes when comparing the investment to a municipal bond investment. Safety of Municipal Bond Investment Municipal bond investment is historically pretty safe. That should be said as the headlines are full of news on huge state and local deficits. However, over the last decades the default rate on municipal bonds has been less than 1% while the default rate on corporate bonds has been over 10%. Nevertheless, municipal bond investment in more than one municipality in order to balance risk is not a bad idea. A fundamental analysis of municipal bonds should include a number of specifics. Not all municipal bonds are tax exempt! A bond offering will typically come with certification by a law firm that the bonds are tax exempt and to what degree. If you as the investor do not live in the municipality or state where the bonds are issued you will probably not be eligible for a local or state tax exempt status, if it is part of the bond. Bonds are rated by agencies such as Moody's or Standard and Poor's. To the extent that there is a risk of default it will be wise to make sure that the bonds have an investment grade rating. As of 2008 there had never been a default on a Moody's or Standard and Poor's Aaa/AAA municipal bond or a Standard and Poor's AA rated bond. Investment grade municipals in general have a historic rate of default of less than a fifth of a percent. As with all investments the investor should sit down with paper and pencil (or at the computer) and calculate the return on investment of municipal bonds versus other investments considering the relatively low level of risk involved. Depending upon if the stimulus program goes away rates may or may not rise. If so municipal bond investment may be an attractive vehicle for those soon to be paying higher taxes. http://youtu.be/x4jjzIC7gIs
Views: 493 InvestingTip
What Is Pre Market Trading?
http://www.profitabletradingtips.com What Is Pre Market Trading? By www.ProfitableTradingTips.com The stock market news often reports that a stock is up or down in pre market trading. So, what is pre market trading? It is trading that takes place before the NYSE or NASDAQ open. What is pre market trading for the average investor? It is a market with reduced liquidity and reduced volume in which the trader is wise to always use limit orders to protect himself from unexpected market swings. What is pre market trading compared to after market trading? They are the same thing. Pre market simply refers to price action that occurs shortly before markets open instead of just after they close. The point of pre market trading is that news breaks and things happen when North American markets are closed. One who is trading Roche and Avastin, for example, may pick up on news from the Swiss company's headquarters. The announcement may come in the morning in Switzerland. This will be during pre market hours in North America. Anyone who wants to trade coming price swings in Roche will have better luck trading in the pre market hours as Roche ADRs could open at a substantially different price from the previous day closing on the NYSE. What is pre market trading to the trader who picks up on the news and trades it successfully? It is profitable. Not all market makers and not all electronic communications networks are active in pre market trading. As such volume is lower and so is market liquidity. This is why experts suggest that a trader always use limit orders. Pre market trading can be quite profitable and it can be disastrous if the trader is out of touch with market movement or if a huge and unanticipated price jump occurs just after the trader makes a trade. Because of the lower liquidity of the pre market or after hours market trading techniques such as scalping and shaving may or may not work very well. Likewise, technical analysis software works the best when volume and liquidity are high. What is pre market trading for the technical trader? It could a pitfall, where otherwise accurate trading signals fail to warn of pending price changes. What is pre market trading for the individual attuned to its idiosyncrasies and ready to profit from breaking news? It can be quite profitable. The world is a big place and billions of folks are working while North American markets sleep. Changes in Forex, commodities, and non-North American stocks happen routinely while Americans and Canadians are in bed. For the trader willing to adjust his hours, trading the events of the world, in that thinly traded market, could just be the best way to make profits. As in all trading, the trader will need to develop a trading strategy appropriate to the pre market. A pre market trader will certainly need to learn how to trade stocks online as brokers are not waiting to take calls in pre market hours. As in all trading, focus is important. Not all opportunities in pre market trading are equal. Knowing where to look for market opportunity in the pre market can be as important to profits as executing skillful trades. For more insights and useful information about trading stocks, options, futures or Forex, visit www.ProfitableTradingTips.com. https://youtu.be/oLTyzOT6Bi8
Views: 5884 InvestingTip
How Does the Stock Market React to Presidential Elections?
http://profitabletradingtips.com/profitable-trading-tips/how-does-the-stock-market-react-to-presidential-elections How Does the Stock Market React to Presidential Elections? By www.ProfitableTradingTips.com The presidential election campaign is turning the corner with the Democratic convention this week. In four months the country will elect a new president who will take office in January 2017. From a trading viewpoint we wonder how does the stock market react to presidential elections. Kiplinger looks at the presidential election and its effect on stocks. Since 1833, the Dow Jones industrial average has gained an average of 10.4% in the year before a presidential election, and nearly 6%, on average, in the election year. By contrast, the first and second years of a president’s term see average gains of 2.5% and 4.2%, respectively. A notable recent exception to decent election-year returns: 2008, when the Dow sank nearly 34%. Looking back to 1900, Democrats have been slightly better for stocks, with the Dow up an average of nearly 9% annually when the Democrats are in control, compared with nearly 6% per year during Republican administrations. There is an opinion not borne by the facts that a divided government is good for business and for stocks because such a situation saves each party from following through on its worst instincts. However, it turns out that the market does about the same when one party controls both the executive and legislative branches as when control is split. Will it make a difference this year if Trump and the throw the bums approach wins or Hillary Clinton with years government experience prevails? Trump and the Stock Market Our sister site, ProfitableInvestingTips.com asked what would a Trump presidency mean for stocks. Although it’s impossible to know who will win, many speculate that a Trump presidency would send the economy and stock market into a downward spiral. Experts are also drawing parallels between the audacious Trump campaign and the recent Brexit vote. His supporters, like leave voters, are tired with the status quo and would do anything to see that change. If the offbeat republican happens to win the White House, there are few themes investors should watch. On the other hand if he builds the wall it will help construction stocks. Clinton and the Market Because of her long record of public service more is known about Hillary Clinton and more might be guessed about what a Clinton presidency would mean for stocks. Kiplinger offers 7 suggestions based on policies that would be implemented in a Clinton administration. • Cognizant Tech Solutions • Hospital Corporation of America • Lockheed Martin • Marriott International • Sun Power • Toll Brothers • Wal-Mart Stores Although one can more easily predict what Clinton will pursue in the oval office as opposed to Trump there is the issue of Republican resistance to every single thing that she proposes. A true Clinton presidency will probably require democratic control of both houses of congress which might be a stretch. The Flip Side Turn the question around and you can ask how do presidential elections react to the stock market. That one is easy. A bull market favors the party in power and a bear market favors the party that has been out of power. Clinton will want the current strong market to continue and Trump will be hoping for a crash. https://youtu.be/Xhy_Wc1tMYY
Views: 1734 InvestingTip
When to Buy Oil Stocks
http://www.profitableinvestingtips.com/profitable-investing-tips/when-to-buy-oil-stocks When to Buy Oil Stocks. By www.ProfitableInvestingTips.com Oil prices have been on a five month slide. Nymex crude hit $64.74 which is the lowest in five years. The last time oil was priced this low was the depth of the great recession. The US oil fracking boom is partly to blame as there is a glut of oil in North America. But, in addition, OPEC is not cutting back on production, which is what the cartel usually does to prop up prices. As a result oil stocks have taken a beating. Is this when to buy energy stocks? One would usually expect to see investors picking up great deals at this point but that is not the case. As an article in the Wall Street Journal notes, energy stocks have few buyers even at bargain basement prices. Energy stocks are on sale following a five-month plunge in crude oil, but so far few investors are heeding the temptation to bargain-hunt. Portfolio managers and analysts covering the sector are bracing for a wave of dividend cuts, share-repurchase delays and capital-spending reductions that will likely ripple across an industry reeling from the 38% tumble in U.S. crude futures since June. Distressed-debt investors are circling a handful of deeply indebted U.S. shale-oil producers that are deemed unlikely to survive further oil-price declines without mergers or overhauls. It would appear that perhaps too many companies in the energy sector were too highly leveraged and are in trouble due to falling prices. And, it may well be that prices will continue to fall. When to buy oil stocks is when the price of crude bottoms out but that is not yet the case. Factors That May Signal a Turnaround Oil prices respond to the laws of supply and demand. Supply is high with the US fracking boom and OPEC refusing to cut back. Demand may be weakening. The Chinese economy is slowing and that means less need for raw materials and energy. When to buy oil stocks is probably not when there is still the risk of another recession in Europe and a slowdown in China. When to buy oil stocks will be when OPEC signals a cutback and when North America, Europe and China are all well on their way out of a recession. Not Just Oil Stocks It is not just oil stocks that are hurt when signals of economic weakness come out of the USA, Europe or China. World stocks and not just oil are down due to weak Chinese economic data and even news of a weaker than expected start to the North American holiday shopping season. CHINA FACTORIES: A survey by HSBC Corp. showed Chinese manufacturing activity weakened in November, adding to signs an economic slowdown is deepening. HSBC said its purchasing managers' index declined to 50.0 from the previous month's 50.4 on a 100-point scale on which numbers below 50 show activity contracting. The bank said domestic demand was sluggish and new orders were weak. China's economic growth slowed to a five-year low of 7.3 percent in the latest quarter. BLACK FRIDAY: Early discounting, more online shopping and a mixed economy meant fewer people shopped over Thanksgiving weekend, the National Retail Federation said Sunday. Overall, 133.7 million people shopped in stores and online over the four-day weekend, down 5.2 percent from last year, according to a survey of 4,631 people. Total spending for the weekend is expected to fall 11 percent to $50.9 billion from an estimated $57.4 billion last year. Oil stocks weaken with the economy and rise with good economic news. When to buy oil stocks will be when the news is better. Picking Bargains If weak oil prices persist we can expect to see mergers and acquisitions in the oil sector. An early example is the purchase of Baker Hughes by Halliburton. Halliburton (HAL) said Monday it will spend $34.6 billion to acquire Baker Hughes (BHI). The deal between the second- and third-largest companies in the industry would form an energy giant with more than 136,000 employees. The best places investors to pick up deals when the time comes to buy oil stocks are those already in the energy sector. http://youtu.be/3bQemwYeEsk
Views: 2566 InvestingTip
Why Buy Penny Stocks?
http://profitableinvestingtips.com/penny-stocks/why-buy-penny-stocks Why Buy Penny Stocks? By www.ProfitableInvestingTips.com Penny stocks are cheap but are they good investments? Why buy penny stocks? For that matter what is a penny stock? According to Investopedia: A penny stock typically trades at a relatively low price and has a small market capitalization, usually outside of the major market exchanges. These stocks are generally considered highly speculative and high risk because of their lack of liquidity, large bid-ask spreads, small capitalization and limited following and disclosure. They often trade over the counter through the OTCBB and pink sheets. So, why buy penny stocks? Most penny stocks deserve their low price but there are diamonds in the rough. Trendshare poses the question, should you buy penny stocks? You must do your research to find any good stock. Plenty of stocks are undervalued, but to prove that you must understand their business. Why is the stock price so low? Is the company struggling? What are the chances it will succeed? Most of these businesses are risky gambles, and they're obvious even after a few minutes of looking. That's why penny stocks are bad. Your research time could pay for itself. Because so many penny stocks are bad investments and even subject to pump and dump price manipulation most investors avoid this entire market niche. That having been said there are good penny stocks that will make a lot money if you find them. How does that work? You can do all of the research yourself or you can use the advice of market analysts. Penny Stock Suggestions Money Morning routinely offers penny stock suggestions. Here are their 5 top penny stocks from a recent article. Today we're bringing you our updated list of the top five penny stocks this week. All of the penny stocks in this week's list delivered market-busting gains last week, with the top-performing stock rising over 170%. Money Morning updates our top five penny stocks list every week for readers. We only add stocks from the most reputable exchanges, like the NYSEMKT or Nasdaq, to our list. That's because these exchanges require more rigorous financial standards than Over-the-Counter (OTC) markets. It is important to note that they do not pick penny stocks from OTC markets but rather stocks that are held to higher financial reporting standards, which makes analysis more accurate. These are their most recent picks. Lucas Energy, LEI International Shipholding, ISHC Ekso Bionics Holdings Inc., EKSO Novavax Inc., NVAX Neonode Inc., NEON Lucas Energy is a depressed energy stock while International Shipholding is a maritime shipper and a turnaround play. Both of these stocks get better if the economy improves. Ekso is a fast growing company that makes exoskeleton devices or wearable robots. If this stock succeeds it will be phenomenal. But remember what Warren Buffet says about picking stocks in fast growing sectors. You can predict that the sector will grow but it is hard to predict the individual winners. Novavax is a biotech company that makes vaccines with a proprietary synthetic gene method. Like other biotech companies this one could soar to huge profits as the biotech sector grows but picking individual winners is tough. Neonode develops optical sensing technology that turns surfaces like tabletops into touch screen surfaces for smart devices. The same promises and cautions apply to this stock as to other high techs. With all the trouble picking winners why buy penny stocks? Adding a reasonable number of well-chosen penny stocks to your portfolio offers the possibility of investing a home run or two with one hundred fold or even a thousand fold gains. https://youtu.be/VzsCmqF65sE
Views: 158 InvestingTip
Smart Cell Tower Investing
http://www.profitableinvestingtips.com/investing-trading/smart-cell-tower-investing Smart Cell Tower Investing An investment that fits into the skill set of a smart long term investor is cell phone tower investment. A cell phone tower or cell site is where the phone company places a base receiver station or mobile phone mast. This technology allows for use of cell phones throughout the entire service area of the provider. Cell phone service providers own less than ten percent of these installations. They lease the rest. There are hundreds of thousands of these relay stations in the USA and Canada as well as throughout the world. Cell Tower Gold estimates that there are roughly 370,000 of these sites available for purchase, ownership, and resale in the USA alone. Smart Cell Tower Investing Smart cell tower investing, like all investing, starts with sound fundamental analysis. Where are the sites? Who owns them? Are they willing to sell and if so, for what price? Are there factors that might complicate a sale and are there ways to fix the complications to make the deal more profitable for you? Can you get financing if you buy? Do you have cash to invest? Do you have a list of eventual buyers who want to add to cell phone site leases to their investment portfolios? Start with a Sunday drive and look up at building tops, towers, hill tops, etc. Take a map with you and mark down the sites. Go online and visit www.AntennaSearch.com. You will find many cell sites listed on this web site. Then go and find out who owns the property on which the cell tower is located. The next part of smart cell tower investing is to talk to the owner and find out if he or she is interested in selling the property or even just the lease portion. If you run into a business owner who is strapped for cash you might be able to provide him with a cash infusion in return for his lease on a rooftop cell tower. If you find a failing business you may be able to help rehab the property and business in return for the lease or even purchase the entire property for eventual resale. Buy and Hold versus Middleman If you are looking for a sound long term investment comparable to dividend stocks, consider smart cell tower investing. Cell phone technology is likely to stay around for a long time. Cell phone leases are steady and commonly have a yearly increase built into the contract. Smart cell tower investing also includes flipping these assets. This is not a matter of day trading assets like stocks but is rather a matter of short term investing. In smart cell tower investing one finds cell sites that are in some way distressed. Especially now when it still may be difficult for some businesses to get credit, someone with cash or credit could pick up a number of these sites, fix any problems like rehabbing offices to attract renters or working to get overly high tax rates decreased. A viable approach to smart cell tower investing is to find long term investors who will pay you a percentage as well as for your time and costs to find these properties and bring them to the point of sale. A good way to gain excellent insight into this business is the short course offered by Cell Tower Gold. If you would like more information about this amazing and unique opportunity, please join our mailing list. We will be sending more information over the next few weeks in our newsletter. For more information about this amazing opportunity, please visit http://www.celltowergold.com. http://youtu.be/dAUvbBJpk4E
Views: 789 InvestingTip
Foreign Direct Investment
http://www.profitableinvestingtips.com/investing-tips/foreign-direct-investment Foreign Direct Investment By www.ProfitableInvestingTips.com Follow the money is age old advice for knowing why something is happening. In this case we would like to follow the money that goes into foreign direct investment. Foreign direct investment is done by folks with lots of money and the intention to stay on course and make a profit. If you are looking for offshore investment ideas, take a look at where foreign direct investment goes year after year after year. There have been changes afoot regarding where foreign direct investment is going. A very useful reference in this regard is the just published United Nations study, World Investment Report 2013. We have used 2007 and 2012 as bookend comparison years as 2007 was just before the onset of the worst recession in three quarters of a century and 2012 is the most recent year reported. Of note is that direct foreign investment has fallen in the large majority of nations but there are exceptions that should help guide investors with their fundamental analysis of where to put their money in the years ahead. First take a look at the data and then read about foreign direct investment. Foreign Direct Investment Comparison of 2007 and 2012 In Billions of USD Taken from the United Nations World Investment Report 2013 Nation 2007 2012 European Union 859 323 UK 200 71 France 96 37 Germany 80 67 North America, incl. Mexico363 408 Canada 117 54 USA 216 329 Mexico 31 26 Japan 23 123 China 84 84 China, Hong Kong 62 83 South Korea 9 33 India 25 9 South Africa 6 4 Russian Federation 57 51 Brazil 35 -3 The largest gain in foreign direct investment on our chart is in the USA followed closely by Japan (113 billion to 100 billion). As a percentage increase Japan out performs everyone with an increase of more than 400%. Other significant performers are South Korea with a more than 200% increase in foreign direct investment and Hong Kong with a twenty-five percent increase. It is significant that the BRICS nations which were thought to be ready to move up economically lost as a group. China stayed put at $84 Billion. Russia fell from $57 Billion to $52 Billion and South Africa fell from $6 Billion to $4 Billion. Brazil fell off the charts going from $35 Billion in direct foreign investment to a negative $3 Billion because investors are taking money out of the country! Direct Foreign Investment: What Is It and Why Do It? In general, foreign direct investment includes mergers and acquisitions, the building of new facilities, reinvestment of profits earned overseas and cross border loans within offshore operations. Basically companies invest offshore because they expect to make a profit over the long term. Because of the long timeline needed to research new projects and develop them, this sort of investment is typically well thought out. Reasons to invest offshore aside from expected profits include low taxes, tax holidays of the twenty-five year or longer variety, preferential tariffs, investment loan subsidies, free land or land subsidies, R&D support, proximity to profitable markets and more. Can You Follow the Money and Make a Profit? There are some useful lessons to be learned from reading the results of the World Investment Report 2013. A lot of the hype about Brazil and the rest of the BRICS nations was largely that, just hype. Brazil is attached at the hip to China and when events in China trigger the next big stock market crash Brazil will suffer. Money is going where there is economic, social and political stability, high end technology, democracy instead of dictatorship and nations that are interested in getting foreign investment instead of driving it away. Hong Kong is preferred over China because of the democratic residual from British colonial days. Japan is in an economic resurgence and Korea is largely keeping pace. The USA remains the most economically open economy and thus benefits the most from direct foreign investment during troubled times. When you decide where to put your money look for growing economies and economic sectors, tax advantages to your investment in a given economy and political stability so that the next government does not decide to confiscate your investment. http://youtu.be/pmqXFPWG87s
Views: 12599 InvestingTip
What Happens to Their Economy When Mexico Runs Out of Foreign Currency Reserves?
http://profitableinvestingtips.com/profitable-investing-tips/what-happens-to-their-economy-when-mexico-runs-out-of-foreign-currency-reserves What Happens to Their Economy When Mexico Runs Out of Foreign Currency Reserves? By www.ProfitableInvestingTips.com Mexico is struggling to keep their currency from falling too far and too fast. The problem is that buying pesos with dollar reserves is not helping and it is eating up their currency reserves. Bloomberg says Mexico needs new peso-saving tools. Mexico’s central bank, struggling to lift the peso from its record lows, is getting backed into a corner after spending $2 billion last week with little effect. Recent dollar sales aren’t helping boost the currency, foreign reserves are faltering and economists expect policy makers to raise interest rates again in February after five hikes last year. While some analysts say Mexico could try dollar swaps or increasing its credit line with the International Monetary Fund, they warn against depleting reserves. That could undermine investors’ confidence and intensify the market selloff. All of this has to do with president elect Trump declaring war on trading partners such as Mexico and China. Where will Mexico sell its products if Trump slaps huge tariffs on exports to the USA or tears up NAFTA? What happens to their economy when Mexico runs out of foreign currency reserves? When a Country Goes Bankrupt The Economist discusses what happens when a country goes bust. The point is that when a country runs out of hard currency it cannot pay its debts. When a country fails to pay its creditors on time, it is said to go into “default”, the national equivalent of going bankrupt. But sovereign defaults are quite different from business bankruptcies as it is far harder for creditors to repossess the assets of a sovereign entity than to repossess the assets of a company. A common solution is to write down debt with bond holders rather than default. But these so-called “haircuts”, where the original value of a bond is reduced, can be much more painful for the holders of government bonds than a simple clip of the scissors. When Greece defaulted in 2012, bondholders were forced to take hits as high as 50%. In less severe cases, countries may choose to restructure their debt by requesting more time to pay. This has the effect of reducing the present value of the bond-so it isn’t entirely pain-free for investors. If you are holding Mexican bonds you ought to be worried that Mexico will run out of currency reserves. And when a country has to write down its debt it commonly must agree to austerity measures in order to balance its books. These measures commonly include reductions in social spending. That can bring on political and social unrest and result at the least in a change in which party rules and a worst in total political and social chaos that leads to revolution. If Trump is unhappy with imports from Mexico he might think twice when the country of Mexico dissolves into social unrest violence and political chaos. The Trump formula for success supposes lower taxes, less regulation and more money in everyone’s pocket. It does not suppose a civil war south of our border. https://youtu.be/lUTxyHd5Ahs
Views: 4868 InvestingTip
Futures Market Trading
http://profitabletradingtips.com/trading-investing/futures-market-trading Futures Market Trading By www.ProfitableTradingTips.com Futures market trading involves standardized contracts for buying and selling specified quantities of commodities, equities, or other financial instruments. Futures market trading of these derivative contracts allows businesses and speculators to hedge investment risk as well as profit from market fluctuations. There are futures exchanges located in nations around the world. Each has its own rules and procedures for standardized contracts and procedures for futures market trading. The quantity of grain in a wheat contract or number of shares of stock in stock futures contract may vary from market to market. However, the principles of futures market trading do not vary from market to market. In each locale traders buy or sell the right to take or make delivery of the underlying asset as of the expiration date of the futures contract. As many use futures markets to hedge risk they often exit their futures contract before expiration, either with profits in hand from a profitable future trade or because they have no interest in taking delivery of a herd of live cattle. The trader simply executes the opposite trade in order to exit his position. When a contract is created it is referred to as open interest and when a trader exits his or her position with the opposite trade the open interest and contract disappear. Futures Market Trading for Businesses Businesses that buy or sell commodities, for example, use futures market trading to hedge investment risk. As an example, a gold mining company may be concerned that the price of gold bullion, and their profits, will fall in the coming year. The company will sell futures on gold bullion as a means of guaranteeing a given price for their product. Likewise a company that buys a lot of gold may choose to purchase gold futures in order to have a set price for the coming year. The same works for agricultural producers and their buyers. Futures Market Trading for Speculators Many trade the futures markets in search of profits and not in order to hedge risk for an existing business. These traders pick and choose which things on which they want to trade futures. The advantage of this approach is that some parts of the futures market may be very quiet and some parts may be very volatile. It is the volatile market where futures market trading can be the most profitable for speculators. Futures Market Clearing, Settlement, and Options Futures market trading proceeds in an orderly fashion because of the companies that guarantee efficient, orderly, and transparent trading. Settlement of trades is typically handled by institutions that guarantee payment and eliminate counterparty risk for traders. Because of the risk of a bad trade exceeding the ability of one party to pay the other, traders need to put money in a trading account and trade on margin. When potential losses approach the size of the margin account the trader receives a margin call and must replenish his trading account or have his account closed and contracts sold. An alternative to dealing with margin accounts is trading futures options. In this case the trader buys puts or calls on futures contracts. He or she only executes a futures trade if doing so is profitable. The extent of possible losses is the cost of the options contract. The later aspect makes options a popular futures trading strategy. For more insights and useful information about trading stocks, options, futures or Forex, visit www.ProfitableTradingTips.com. http://youtu.be/5IREPSiogzw
Views: 3648 InvestingTip
Stock Trading Terms 101
Stock Trading Terms 101 http://profitabletradingtips.com/trading-investing/stock-trading-terms-101 Stock trading terms have to do with general aspects of the market and things that are specific to trading stocks. Stock trading terms 101 has to do with general terms that apply to the stock market and trading stocks. First let us look at trends, the bull and bear markets. Trends: Is the Market Rising or Falling? The bulls are in charge the pundits say when the market is going up. A bull market is one in which prices are rising on an ongoing basis. A so called bear market is one in which prices are falling. These terms refer to market trends and not day to day price changes. A secular trend lasts more than five years. A primary trend lasts for more than a year but less than five. A trend that lasts for a few weeks or months but less than a year is called a secondary trend. Understanding these stock trading terms and what they imply is important for successful stock trading. For example, if you engage in range trading (repeatedly buying at the bottom and selling at the top of the market for a stock whose price cycles up and down) you need to have a clear idea of when a stock will hit its peak and when it will bottom out and head back up. If you are in a long term bull market the general range in which you will steadily head upwards causing you to continually adjust the channel in which you trade. But, knowing more precisely when the market will turn requires analysis of evolving market sentiment. What Is the Sense of the Market? The stock trading terms that apply to unfounded beliefs about stock prices are market (investor) sentiment and technical analysis. Before virtually every stock market crash there seems to be a period of euphoria in which naive investors pour money into the market. They appear to believe that since the market has been going up for a month, year, or five years that it will continue to go up. This is investor sentiment at its worst. Its twin is when the market falls and everyone sells, just as many excellent bargains appear in the market due to panic selling. Many successful stock traders take advantage of unfounded investor sentiment. They use technical analysis. This is the statistical analysis of price patterns. Because price patterns often repeat themselves stock traders can read the first part of a pattern and then trade accordingly with the assurance that the second half of the pattern will develop. This method goes back centuries to tulip bulb trading in Holland and rice trading in Japan. The Japanese method, Japanese Candlestick trading, is still in existence today. Technical traders commonly jump in and out of the market as opportunities rise. Stock Investor or Stock Trader Although we are considering stock trading terms, the general principle of understanding the fundamentals that drive trends and market sentiment that drives usually bad decisions applies to trading as well as investing. Many successful long term investors only purchase stocks when those stocks are undervalued and only sell when it appears that fundamentals will change and a stock will likely to go into a long term decline. When the market does not make sense long term investors get out. When the market does not make sense from the viewpoint of fundamentals the stock trader jumps in and takes advantage of misguided market sentiment. http://youtu.be/LuLbcNrqMFU
Views: 2600 InvestingTip
Invest in Post War Syria
http://www.profitableinvestingtips.com/investing-trading/invest-in-post-war-syria Invest in Post War Syria The tide has turned in the grueling Syrian Civil War. Opposition forces have taken another town in the North. United States has stated its willingness to provide non-lethal support for the rebels. The Syrian Opposition is already receiving arms from the likes of Saudi Arabia. Many believe that it is only a matter of time before Bashar Assad steps down from power and flees the country or is assassinated. Once the Assad family is no longer part of the picture negotiations between the remaining government and rebel forces may be possible. Baring that scenario, the increasingly well-armed opposition may simply win the war, much like what happened in Libya. Assuming that the war will come to an end in the next year or so, is it possible to profitably invest in post war Syria? How does one do fundamental analysis of such a situation? Here are a few thoughts on how to invest in post war Syria. Invest in Post War Syria through Its Historic Trading Partners When the war ends in Syria people will need to eat. Refugees will return. There will likely be international aid on a large scale. However, Syria has trading partners. Turkey, Jordan, Lebanon, and Iraq all share borders with Syria. Syria has been, to a degree, a client state of Russia. It remains to be seen how much influence Russia will retain if the Syrian government falls without a peace agreement. Local trading partners will likely resume business with their old business partners in Syria. Manufacturers, wholesalers, and trucking companies in Turkey will benefit and will likely investing post war Syria by beefing up their operations at home or investing directly in Syria. The same applies to Iraq, Jordan, and Lebanon. We previously wrote about Three Good Offshore Investment Ideas in the Western Hemisphere. A fourth good idea might be to invest in post war Syria. NASDAQ carries a Turkish ETF that outperformed most others across the world in 2012. If peace breaks out on the nation's borders it could further stimulate the Turkish economy and raise the value of Turkish stocks traded as ADR's in the USA. Who Wins and Who Loses in the Syrian Civil War If you want to invest in post war Syria there are two caveats. One is the famous "blood in the streets" statement by Baron Rothschild from the 19th century. The best time to invest is when there is blood in the streets even if it is your own. When things are darkest is the best time to pick up deals. However, the second caveat is to know who will win and who will lose in the broader context if the Syria Civil War continues, if the government wins, or if the rebels win. The background for this conflict and for much of the Middle East is religious. The main branches of Islam are Sunni, Shia, Sufism, Kharijite, Ahmadiyya, and Quranism and there are successively smaller sects. The largest group is the Sunni followed by the Shia. Although the Shia branch comprises only ten percent of all Islam they are the majority in the countries of Iran and Iraq and are the largest Islamic group in Lebanon. Syria is 87% Muslim and 74% Sunni. However, the ruling party is Alawite Shia is only 13% of the population. From a religious standpoint it will be a loss for Iran, Iraq, and Lebanon it the Shia led government of Syria falls and a Sunni majority takes over. It remains to be seen how relations will fare based on religious affiliation but to the extent that religion dominates, picking sound investments in the area will probably have to do with picking local entities that understand the culture and business of the region and its people. http://youtu.be/WyXii-S-KUg
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