Investment Articles

When you research your investments, you may want to consider getting professional guidance to help you out. Without good advice and information, a lot of investors have made bad choices based on what they thought they knew. This is a mistake that can be avoided if you spend a little time doing some research and finding good people to put on your team.

There is an overwhelming amount on information out there pertaining to stocks, bonds, mutual funds, and just investing in general. There are TV shows, radio shows, seminars, books, newsletters. web sites, commercials, ads on the computer, magazines, and sales professionals that are trying to grab your attention. There are 3 things you can do to make sure you do the best job at picking a good source.

Evaluate the source you are looking at considering. You need to come up with questions to ask them, just like a job interviewer would do. You can get an idea of the these questions based on what you want and what you are expecting. Interview a few people before committing to anyone in particular. You will know when you meet someone who just seems like they get it at a deep level. These are the people you want on your team.

Look for attention grabbers. All this means is that there are clever marketers that put ads out just to get your attention. This can be good if there is a solid company behind the ad, but don’t base your decision of any ad that you see. This is a mistake you don’t want to make. In the same sense, you will want to watch out for hidden costs no matter who you decide to go with. Make sure you understand all the costs associated with whatever company you choose.

You will want to attend classes and seminars that will be offered by the investment firm you have chosen. You may even have to go elsewhere to learn about trading. Not all companies offer seminars, but most do today. Finding a company that provides great tools and information that is free to you, is a great company. They are trying to help you learn and grow because they know if they do, you will be with them for a long time. This is called creating a win win situation.

Darius has been writing online for a while now and has a lot of different interests. You can check out some of his websites at http://www.calphaloncontemporarynonstick.net and http://www.calphalontriply.net

This all starts with the saying we all have heard, don’t put all of your eggs in one basket. This just means that you should invest in a variety of different investments to even your portfolio. There are two parts that every investor must determine in order to make their personal investment plan. Those two factors are their time to invest and their risk tolerance. How much of price fluctuation can you tolerate in your account based off when you will need the money to retire?

If you choose a mix of stocks, bonds, and cash. The reason that you will need to choose all 3 classes is because there is no one person that can determine what the market will do. The bond market or the stock market may crash at any point in time. There are indicators and people can reason and make educated guesses what will happen, but everyone will be wrong at some point in time. By choosing a plan that involves all 3 asset classes, the investor can sleep at night without worrying about what will happen.

Investments take a great deal of time and energy. Investment firms spend a lot of time researching these 3 different asset classes and know what you will need, based on your personal situation. Use these firms to your advantage to help you get started and get on the path of least resistance.

You need to make sure you understand one main part of investing. There is one word to learn and learn well. That word is volatility. Volatility is the amount of change that you will see in your investments over a certain period of time. It is measured by different statistics, which the most common is called standard deviation. This might bother some more than others. This is why you must understand it before investing.

Some investors may be able to watch their portfolio take a 10 percent dive and be OK knowing they have made a sound decision. Other investors may not be able to look at this 10 percent and be OK. They may have trouble sleeping at night knowing they are down that much. They would have been better off finding a predetermined point to get out and cut their losses at. You must decide what is right for you and your situation.

Darius has been writing online for a while now and has a lot of different interests. You can check out some of his sites at http://www.computertabledesk.org and http://www.colemanmosquitodeleto.com

If you are interested in learning how to trade options, and are looking for resources to help you get started, Get Rich with Options by Lee Lowell is a great place to start.

This book will give you a great foundational understanding of the various options trading strategies. It will help you sharpen your trading skills by learning from the successes and mistakes of one of the best professional traders.

Lee’s credentials as a trader speak for themselves. He has spent 15 years in the trenches as an options trader. He started working on the floor of the New York Mercantile Exchange (NYMEX). Then after learning how the Market Makers trade, he ventured out on his own and opened up his own investment firm.

He has broken the book in to three different parts.

In the first part, he gives a background on what options are. He goes in depth into topics such as:

- The basic difference between a call and put
- How options are priced and why it matters
- Option Volatility and how understanding it can increase your profit margins.
- Why selling options is the key to long term success for any trader

In the second part, he explains a few different options selling strategies. These may be helpful for you, particularly if you have a stock portfolio you are looking to maximize. He even talks about his own personal favorite trading strategy (I’ll give a hint: it’s called Credit Spreads. Read about it on page 115).

Finally, in Part 3, Lee gives some specific tools that traders can go to expand their knowledge, expertise, and profit margins. He even dedicates an entire chapter to brokers and commissions and how to reduce how much you are paying.

Get Rich with Options is an excellent read for any options trader, whether you have been trading the market for years, or you are just beginning to learn.

Jeffrey Ziegler is a professional trader who shows you step-by-step how to bring in consistent monthly cash flow utilizing the power of options. View a free video about his proven system at http://www.JeffreyZiegler.com.

A key element of any investment philosophy is to invest in ‘quality’ companies. We believe quality companies deliver higher returns at a lower level of risk than low quality companies. The issue with the term ‘quality’ is defining what exactly is a quality company and what it not. Quality is a subjective measure and what may look like quality to one person is not to another. It is also difficult to measure and value. Unfortunately we cannot simply insert a line into a company’s balance sheet called ‘quality’ and attach an appropriate dollar figure.

Here are some key indicators of quality companies:

1. Track record of steady growth in earnings per share (EPS)
A quality company should be growing its earnings over time. It is important to look at EPS rather than just profits because profits can be inflated by issuance of additional equity and acquisitions. EPS is the best measure of real earnings growth.

2. Track record of steady growth in dividends per share
Nothing is more transparent than dividends. The payment of a dividend proves that a company has cash on hand and the financial muscle to produce a cash flow to shareholders. Dividend growth is the key to long-term share price performance

3. Strong balance sheet
It is a simple, but little considered, fact that companies with no debt do not go bankrupt. Some companies that have defensive businesses and high cash flows can tolerate higher levels of debt, but always look for rock solid finances, of which having a manageable level of debt is a key attribute.

4. Strong market position and pricing power
For share investors, competition is the enemy. Prefer companies that have the mettle on their competition either because they have an unrivalled brand, distribution network or product, or look for companies that face low levels of competition, like many utilities. Excessive competition puts pressure on margins and undermines profitability. Look for companies that have high levels of pricing power. Having the ability to increase prices is indicative of a company with a strong market position. Utilities sometimes have this pricing power controlled by regulation.

5. Inherently defensive business
Companies with businesses that are defensive are generally higher quality companies. Defensive businesses are those that provide goods and services for which there is a reliable and growing demand. Companies that provide these sort of ‘core’ services include, banks, utilities, oil companies, healthcare companies, and producers of food and personal hygiene products.

6. Strong management
The experience, vision, leadership skills and integrity of management can have a huge impact on the performance of a company.

Cam Watson is the Chief Investment Officer for ABN AMRO Craigs, which is one of New Zealand’s largest independent investment firms. He has over 18 years experience in the financial services industry. For eleven years Cam has been employed with ABN AMRO Craigs, becoming Chief Investment Officer in 2007.
Previously he has held Business Development, Investment Management, and Client Services roles at Tower, Southpac, Prudential and Tower Trust Services. This experience in a range of senior roles for major companies has given Cam a wealth of knowledge to draw upon and made him one of New Zealand’s trusted investment experts.
Cam holds a Bachelor of Arts Degree and a New Zealand Stock Exchange (NZX) Diploma. He has been a member of the NZX since 2001 and has a current Sharebroker Licence. As with all ABN Amro Craigs Investment Advisors, Cam is required to maintain continuous internal performance modules, covering topics such as industry and regulatory developments. He also has the support and resources of ABN AMRO Craigs global research network. http://www.abnamrocraigs.com/

A key element of any investment philosophy is to invest in ‘quality’ companies. We believe quality companies deliver higher returns at a lower level of risk than low quality companies. The issue with the term ‘quality’ is defining what exactly is a quality company and what it not. Quality is a subjective measure and what may look like quality to one person is not to another. It is also difficult to measure and value. Unfortunately we cannot simply insert a line into a company’s balance sheet called ‘quality’ and attach an appropriate dollar figure.

Here are some key indicators of quality companies:

1. Track record of steady growth in earnings per share (EPS)
A quality company should be growing its earnings over time. It is important to look at EPS rather than just profits because profits can be inflated by issuance of additional equity and acquisitions. EPS is the best measure of real earnings growth.

2. Track record of steady growth in dividends per share
Nothing is more transparent than dividends. The payment of a dividend proves that a company has cash on hand and the financial muscle to produce a cash flow to shareholders. Dividend growth is the key to long-term share price performance

3. Strong balance sheet
It is a simple, but little considered, fact that companies with no debt do not go bankrupt. Some companies that have defensive businesses and high cash flows can tolerate higher levels of debt, but always look for rock solid finances, of which having a manageable level of debt is a key attribute.

4. Strong market position and pricing power
For share investors, competition is the enemy. Prefer companies that have the mettle on their competition either because they have an unrivalled brand, distribution network or product, or look for companies that face low levels of competition, like many utilities. Excessive competition puts pressure on margins and undermines profitability. Look for companies that have high levels of pricing power. Having the ability to increase prices is indicative of a company with a strong market position. Utilities sometimes have this pricing power controlled by regulation.

5. Inherently defensive business
Companies with businesses that are defensive are generally higher quality companies. Defensive businesses are those that provide goods and services for which there is a reliable and growing demand. Companies that provide these sort of ‘core’ services include, banks, utilities, oil companies, healthcare companies, and producers of food and personal hygiene products.

6. Strong management
The experience, vision, leadership skills and integrity of management can have a huge impact on the performance of a company.

Cam Watson is the Chief Investment Officer for ABN AMRO Craigs, which is one of New Zealand’s largest independent investment firms. He has over 18 years experience in the financial services industry. For eleven years Cam has been employed with ABN AMRO Craigs, becoming Chief Investment Officer in 2007.
Previously he has held Business Development, Investment Management, and Client Services roles at Tower, Southpac, Prudential and Tower Trust Services. This experience in a range of senior roles for major companies has given Cam a wealth of knowledge to draw upon and made him one of New Zealand’s trusted investment experts.
Cam holds a Bachelor of Arts Degree and a New Zealand Stock Exchange (NZX) Diploma. He has been a member of the NZX since 2001 and has a current Sharebroker Licence. As with all ABN Amro Craigs Investment Advisors, Cam is required to maintain continuous internal performance modules, covering topics such as industry and regulatory developments. He also has the support and resources of ABN AMRO Craigs global research network. http://www.abnamrocraigs.com/

The longer one is involved in the investment sector the more you realise that being a successful investor is 20% market nous and 80% avoiding stupid mistakes. As legendary investor Warren Buffett put it; “investing is simple, not easy”.

With that in mind, Hhere are some of the more common potholes that continue to trip up investors.

Having unrealistic expectations
Shares have been the best performing investment over the past 60-70 years and have returned around 10% a year. During periods when inflation is low and rising returns tend to be more like 8% a year.

Investors gunning for returns of 15% plus will have to take huge risks to get there by putting all their money on a few shares or properties, or by using debt to gear their portfolio. The higher return you aim for, the higher the chances that you fail. As they say, aiming for the moon can mean you end up in a black hole.

Falling for con artists
There are many unsavoury characters out there that play on people’s gullibility and greed by offering unrealistic returns. Do not get sucked in. If it sounds to good to be true, it will be. I have seen return projections of 20%, 50% and even 150% a year offered to investors. Such returns are complete nonsense. They simply defy the laws of gravity. Consider $100,000 invested today and earning 50% a year. If you manage to earn this return every year you will be a billionaire in 23 years. You will then overtake Bill Gates as the world’s richest person after 35 years. Do you really think this is going to happen? High returns are simply unsustainable over long periods of time and the people offering them are guessing, at best.

Putting too much emphasis on market predictions
Within the investment industry there is an army of very smart investment analysts,economists, strategists and fund managers all getting paid to eyeball markets and come up with the next best investment idea.

Although this research is usually very interesting, and often backed up with very nice colour coded charts, much of the time it is wrong. What trips up all of these experts is not their analysis, but the fact that they are dealing with future events. The future is 100% unpredictable and even the most robust research can be proved worthless by a completely unforeseen event.

Smart investors recognise that nobody can predict the future direction of investment markets and that it is dangerous to put too much stock in such predictions.

Following the crowd
Investors have a fatal habit of chasing what’s hot. Unfortunately, past performance has no bearing on future performance and in fact, last year’s winners can often end up as next year’s wooden spooners.

Lack of balance
The biggest investment tragedies happen when people have their portfolio excessively concentrated on one investment, or one investment sector. The golden rule of investment is to have a good spread of investments across the main sectors; cash, bonds, shares, property and overseas investments.

Fees
This four-letter word has spelled disaster for generation after generation of investors who put their faith in such traditional savings products like whole of life policies and super schemes.

The costs involved with these funds have decimated returns leaving almost nothing for the investor.

Fees are arguably the biggest threat to an investor’s long-term returns. For instance, a super fund that earns 8.0% on its portfolio will have management fees of at least 1.5% then deducted then tax of 2.0%. Take off another 1.5% for advisory fees and 2.5% for inflation the investor at the end of the food chain is left with a return of just 0.5%. Reduce fees by investing directly into markets wherever possible.

Cam Watson is the Chief Investment Officer for ABN AMRO Craigs, which is one of New Zealand’s largest independent investment firms. He has over 18 years experience in the financial services industry. For eleven years Cam has been employed with ABN AMRO Craigs, becoming Chief Investment Officer in 2007.

Cam holds a Bachelor of Arts Degree and a New Zealand Stock Exchange (NZX) Diploma. He has been a member of the NZX since 2001 and has a current Sharebroker Licence. As with all ABN Amro Craigs Investment Advisors, Cam is required to maintain continuous internal performance modules, covering topics such as industry and regulatory developments. He also has the support and resources of ABN AMRO Craigs global research network. http://www.abnamrocraigs.com/

Compared to the old ways of years past, finding ways to invest your money have never been easier, faster, and more informed due to the technology of the Internet. You can earn money instantly with up to the minute stock trading with different services that offer the ability to make purchases for only a few dollars, and making commodity purchases or precious metals are just as easy.

Current tracking of your individual retirement accounts, 401Ks, or bank accounts are available over the Internet as well, when in days passed you had to wait for your quarterly report or had to wait for confirmation of where your account was when the papers were mailed. By the time you received how much damage was done it was too late to do anything about it.

Today, you can look up your accounts online, make instant changes to how your investment dollars will be working to earn money for you, and stop the bleeding of a bad investment quickly before you are sucked dry by a failing stock. This freedom to keep your own tabs on your accounts cut out any middle man trying to change your mind or cause you to steer away from your instincts. Losing money is never fun, and stopping it from happening is both satisfying as well as important to your retirement plans.

Beyond the ability to watch your own current investments instantly, the chance to gain valuable information on a company before purchasing stock or looking into speculations on a specific trend in the market can be done rapidly. You can make well-informed decisions on how to invest your money and increase your opportunities to earn money instead of lose it. When in the past you had to rely on a broker for all your information and trust he was honest, now you have a greater chance of finding out things first hand and make your own assessments.

Using the Internet to research, find, and eventually purchase an investment seems to be the trend of the future as the old broker over the phone method is beginning to go the way of the dinosaur. Earn money on your own terms instead of having to be at the whim of a brokerage or investment firm giving you less control over your money. With the implementation of the Internet you have more control over how your investment dollars are used and when they are spent.

Anthony Rivera is the author and can provide additional information on how to earn money online with our earn money online programs site.

Go to my site to see how you can start to earn money online.
http://www.earn-money-online-programs.com

So we know that gold is currently much more valuable than silver. That’s the general knowledge right now, and that’s why companies that have money to invest prefer to buy gold over silver. Because they’re buying and selling gold, their profit margins are larger.

Another reason companies invest in gold is that they know that gold is very popular. Over time, gold has always been considered one of the most valuable metals on this planet. People always traded gold. Kings wore gold all the time. Gold is used as a synonym of wealth. On the other hand silver is called “the gold of the poor”, and of course none of the big and wealthy investment firms want to work with something that’s associated with poor people. So, they select gold over silver.

But gold will decrease in value relative to silver because there will be much more of it as silver is depleted.

The main reason for which we use gold is to store value. Gold is our reserves. Gold is something that will be in demand and we will always be able to trade it for money or for anything we want. It will always be wanted and needed by almost any country in the world.

The crazy thing is that people don’t really consider silver to be a great way to store value. The reason for that is its price. If we want to have enough silver to even consider anything serious we have to have a lot of it. But as I have mentioned in the previous chapter it will not be a case for ever.

Silver will be just as good as gold as a means to store value in the very near future. We will want to buy silver from the investors because we will simply need it for our lives. This is common knowledge for many people that have interest in trading precious metals for long-term investments. Hopefully after reading this book this is common knowledge for you.

Andy Henry is the author of ‘Now Invest In Silver’ a beginners guide to investing in silver and the owner of http://www.nowinvestinsilver.com and http://www.sellingyoursilver.com the new auction site dedicated to silver buying and selling.

Forestry investment has outperformed most other assets for the last 30 years, providing consistent returns averaging 15% per annum over the last decade. Institutional investors like Jeremy Grantham have been using forestry as an effective inflation hedge for years (Grantham even holds 20% of his personal investment portfolio in Forestry), and an investment of £1 million into a managed forest in 1990 would be worth on average £16,366,537 today in 2010 (tax free in most countries too!).

So what is the best forestry investment, and how can smaller investors, who maybe don´t have access to £1 million, participate in forestry investment and take advantage of the low risk, high returns that have been enjoyed by institutional investors for decades?

There are many structures available for smaller investors, with options from Teak to Argawood, through to Paulownia and even bamboo, and there are also various locations to choose from covering most continents and all economies from frontier markets to developed economies. Choosing which type of forestry investment is for you will depend on how long you want to tie up your cash (tree type), and your attitude to political risk (where your forest is located).

After conducting some extensive due diligence on the harvest times of different timber types and their historical price performance and forward looking demand, and also settled on where you are, and are not, happy to invest, you can start to narrow down your selection of investment projects.

Deal Structure for Smaller Investors

Smaller investors can participate in forestry by buying or leasing a small part, maybe a hectare or three, of a much larger managed forest of maybe 1000 hectares. The investor will own the rights to the trees on their hectare of land, and those trees will be professionally managed, harvested and the timber sold, along with all the timber from the entire 1000 hectare site. This kind of deal structure allows retail investors the same kind of deal participation in forestry as institutional investors. These types of investment structures also suppress the ongoing costs involved with forestry in general, as the cost of professional management of your trees, harvesting, negotiating sales and transporting timber is shared amongst all investors in the site, and economies of scale apply.

There are also forestry investment structures that go a long way to mitigate risk, with land title held in trust in the UK or U.S. to protect smaller investors from company failure, and there are even forestry investment packages where all the timber is sold in advance, giving investors a pretty accurate picture of the forward revenue they will receive from their forestry investment.

So, In my opinion, the best forestry investment would encompass a deal structure that mitigated the risks of forestry investment by choosing a forest growing a timber in high demand, and a quick grower too if possible, so I could see a financial return inside five years; Paulownia fits this description quite well. There are no known diseases affecting Paulownia, and the tree doesn’t catch fire below 400 degrees, effectively removing the two greatest risks involved in forestry investment. Paulownia also grows quickly, and under the right circumstances can be harvested every five years, giving investors four cash yields over twenty years.

In my search for the best forestry investment, location figures quite highly as previously mentioned and from a climate perspective I would be looking at South America, Brazil, Panama, Costa Rica all have the relevant climates, and Panama has a favourable tax regime too so revenue earned from the sale of timber, if handled correctly, should present a tax efficient profit for a forestry investment in panama.

The best forestry investment then, as far as timescale and risk are concerned would for me, be Paulownia trees in Panama, with a deal structure in place to ensure a minimum risk level for the investor.

David Garner is Managing Partner at DGC Investment Consultants – http://www.dgc-ai.com – a boutique alternative investment firm advising a network of investors on alternative assets including agricultural investment, investing in forestry and property investment.

Securities arbitration results from the Financial Industry Regulatory Authority (”FINRA”) Office of Dispute Resolution reporting the outcomes of customer initiated investment related arbitrations against stockbrokers and investment firms have been released for 2009.

Not surprisingly, the number of FINRA customer initiated arbitration cases filed in 2009 increased 43% from 4,982 cases in 2008 to 7,137 cases in 2009. The number of these cases was initially expected to exceed 10,000 in 2009. Increases in securities prices in the 2009 have probably reduced the number of claims that would otherwise have been filed last year, given Wall Street’s more recent misconduct, as the high tide conceals that the swimmers are wearing no clothes.

Last years filings are still behind the number of presumably “tech-wreck” related annual filings in 2002, 2003 and 2004. Securities arbitration claims involving misrepresentations and omissions continue to outpace the filing of cases alleging the sale of unsuitable investments, as it is expected these cases particularly in 2008 and 2009 relate to the fraudulent sale of the preferred securities of financial institutions, structured products, bond funds, and the near cash instruments that have been manufactured by Wall Street within the last two years and sold to unsuspecting otherwise conservative investors.

Indeed, FINRA reports a 318% increase in the number of securities arbitration claims filed against brokers involving preferred securities and a 128% increase in the number of securities arbitration claims filed involving fraud in connection with the sale of corporate bonds.

Based upon the FINRA securities arbitration cases closed last year, at least 25%, or 1 in 4 of these cases were not settled or withdrawn, but were decided by arbitration panels. Of those cases decided by securities arbitration panels, investors prevailed only 43%, or less than half of the time, meaning that the chance or probability of not obtaining an monetary award or favorable outcome in an arbitration proceeding is greater than playing Russian Roulette, where only 1 in 6 times, the outcome does not favor the participant.

FINRA also reports that 7% or 310 of the cases closed last were cases “decided by arbitrators after a review of the documents,” but it is unclear if these cases were submitted to FINRA on the papers in simplified arbitration (i.e. claims for less than $25,000) or were cases dismissed by FINRA arbitration panels in advance of an evidentiary hearing. In 2009, the FINRA approved a proposal to limit significantly the number of dispositive motions filed in its arbitration forum and impose strict sanctions against parties who engage in abusive motions practices.

Although FINRA has again launched its “experimental” public arbitration pilot program allowing parties to be excused from the mandatory non-public, securities industry arbitrator required to render judgment on every arbitration panel deciding these claims involving more than $100,000, FINRA reports that of its qualified arbitrator pool, 43% or 2,696 of its qualified arbitrators are non-public arbitrators and are employed or have some significant tie to the securities industry.

If you have been the victim of investment fraud by your stockbroker or investment professional, contact us for a free evaluation at (877) SEC-ATTY. Many cases accepted on a contingency fee basis.

Nicholas J. Guiliano, Esquire
The Guiliano Law Firm
230 South Broad Street, Suite 601
Philadelphia, PA 19102
(215) 413-8223 (Telephone)
(215) 413-8225 (Telecopier)
(877) SEC-ATTY
http://www.securitiesarbitrations.com