Investment Articles

Investors looking to diversify their portfolios and insure their wealth against the ravages of volatility in traditional markets, will most likely have come across a range forestry investments, promising to generate superior inflation-adjusted and risk-adjusted returns for the long-term investor.

But how have timber investments performed? And how does the smaller investor participate in this interesting alternative investment asset class?

Firstly let’s look at the past performance of forestry investments, as measured by one of the main timber investment indices, the NCREIF Timberland Index; according to this basic measure of investment returns in the sector, this asset class outperformed the S&P500 by some 37 per cent in the 20 years between 1987 and 2007. When stocks delivered average annual returns of 11.5 per cent, forestry investments returned 15.8 per cent.

At the same time, returns from investing in timberland and woodlands have been proven to display a much lower volatility, an attractive characteristic for today’s investor.

Previously, the majority of investment returns from forestry investments have been mopped up by larger, institutional investors such as pension funds, insurance companies and university endowments, who have collectively placed over $40 billion into timber investments in the past decade.

So on to the second question; how do smaller investors participate in this kind of alternative investment?

According to a study by Professor John Caulfield of the University of Georgia, returns from forestry investments are three-fold;

An increase in timber volume (biological growth of trees), which accounts for some 61 per cent of return on investment.
Land price appreciation, accounting for only 6 per cent of future returns.
Increase in timber prices per unit, delivering the final 33 per cent of investment returns for timber land owners.

So the best way to harness the performance of timber investments is to take ownership of trees, either directly, or through one of the array of forestry investment funds or other structures.

Timber REITs

One way for smaller investor to participate in timber investments is through a Real Estate Investment Trust (REIT). These investment structures are like funds, in that investors can buy and sell shares in the trust on an exchange, the REIT acquires and manages timber investment properties, but unlike normal companies must pay out 90 per cent of their earnings to investors through dividends.

Some examples of Timber REITs are:

Plum Creek Timber is the largest private owner of timberland in the U.S. and the largest timber REIT with a market cap of about $5.6 billion, many investors have chosen this as their route into forestry investments.

Potlatch is also a timber investment REIT while

Rayonier generates about a 30 per cent of its REIT earnings from timber.

Weyerhaeuser has disposed of its paper and packaging businesses and will convert to a REIT by year end.

The Wells Timberland REIT is not publicly listed but may be available for purchase through Wells Real Estate Funds.

Another way for smaller investors to add forestry investments to their portfolios is to buy Exchange Traded Funds that attempt to track the performance of timber returns. This is less direct than owing timberland, or investing in a timber REIT, as the ETF may also invest in shares in companies involved in the timber supply chain including processors and distributors. This means that investing in forestry through ETFs exposes the investor to some of the volatility of equity markets.

The Guggenheim Timber ETF owns about 25 stocks and REITs involved in the global timber and paper products industry with a 30% weighting to U.S. companies.

The S&P Global Timber & Forestry Index Fund holds 23 securities and is 47 per cent invested in the U.S.

Timber Investment Management Organisations (TIMO)

Those with more capital to spare can participate in forestry investments through TIMOs, although the majority of these investment specialists require a minimum investment of $1 million to $5 million and a commitment to tie up funds for up to 15 years. TIMOs essentially trade timber land assets, acquiring suitable properties, managing them to maximise returns for investors, the disposing of them and distributing profits to shareholders.

Many experts believe that the active management style of TIMOs ensures that they can be more reactive to market conditions than REITs, and therefore don’t tend to fall and rise in line with the market quite as much.

Direct Forestry Investments

Those with access to sufficient capital and the appropriate expert advice can invest in physical properties. Commercial timber plantations are complex operations that require skill, knowledge and expertise to manage effectively and maximise returns whilst lowering risk.

For armchair investors, or those with less capital to spare, many companies offer investors the opportunity to purchase or lease a small portion or plot within a larger, professionally managed timber plantation. Investors normally take ownership of their plot and trees via leasehold, whilst the timber investment company plants, manages and often harvest the trees on behalf of the investor.

Options for investors range from species to species and region to region, with current opportunities in Brazil, Panama, Costa Rica, Germany, Nicaragua and other, more exotic locations like Fiji.

Investors should be wary as many of these direct forestry investments are frontloaded with enormous commissions for salesmen and promoters, with many offering ‘agents’ up to 30 per cent commission for the sale of plots to investors, and in many cases, no due diligence even exits.

In some cases, the Author has seen forestry investment plots in Brazil packaged and sold to investors for over £100,000 per hectare. Investor should seek advice from an independent consultant with experience of this alternative investment asset class, and who is able to present a complete suite of due diligence material, including an independent valuation of the forestry investment property on offer.

Summary

Investors choose forestry investments due to their effect as an inflation hedge, and their ability to generate non-correlated return on investment in the long-term.

Performance of the asset class is driven by demand for timber, weighed against global supplies, and in the long-term we are using timber at a faster pace than we can grow it, making timber investments an attractive asset class for the investor seeking stable, long-term capital appreciation within their investment portfolio.

Investors looking into which type of forestry investment is right for them should consult an adviser that can demonstrate experience and expertise within the sector.

DGC Asset Management Limited is an alternative investments business, identifying opportunities to invest in non-correlated assets.

David Garner is Partner DGC Asset Management Limited.

Entrepreneurs everywhere want to fly with the angels – angel investors that is. But more often than not, dreams have been shattered because the entrepreneur either wasn’t ready or didn’t know what to expect when seeking investor financing. Here is what you need to know to be able to fly with the angels.

No Revenues – No Investment

Are you just starting your business? If so, you must realize that angel investors have a very low probability of investing in a company with zero revenues. They only want quality projects with experienced principals who are liquid, that have a strong management team, and that have a clear cut exit strategy. So the first lesson to learn is that angel investors want to see some history. This proves to them that your product is attractive to real customers who will pay real money.

New Investors Don’t Pay Old Investors

So to get your business started you will most likely end up putting your own money into the business or seek the help of friends and family. Most entrepreneurs then fall into the trap of thinking that an angel investor will come along with financing that will enable the business to pay back the loans from friends and family, as well as the money the entrepreneur himself has invested. It’s better to learn now that angel investors don’t want to take out other investors. They want to see 100% of their investment put into the business to make it grow. So the lesson to learn here is to focus on your business growth strategy, and that usually means re-investing all the profits and cash flow from the business back into the business. But that’s really one of the keys to growth – re-investing your profits back into the business.

Angels Take Their Time

The next thing cash strapped entrepreneurs must realize is that there is a time consuming process involved with angel investor financing. If your business plan does make it into the hands of an angel investor group, it will usually go to a selection committee first where only the best business plans meeting the criteria of the angel investor group will have the opportunity to be presented to the group. The selection committee may take 30 to 60 days to review your business plan and approve it for the investment group to actually look at. The actual investment group may only meet once a quarter, so the entrepreneur may be looking at another 60 to 90 day delay before even getting the chance to present his business plan. So if you are looking for funds to meet next week’s payroll, this is not the place to be looking.

Keep It Short and Sweet

When the entrepreneur finally does get his chance to present his story, he will not be given all the time in the world. If he is lucky, he will get a 20 minute time slot to make his presentation. You should plan on the first 10 minutes being your actual presentation and the last 10 minutes being a question and answer period. Spend your first 8 minutes focusing on your product and about 2 minutes on the investment portion itself. Limit any power-point presentations to no more than 10 slides. Here you should have only 2 slides dedicated to the product and 8 dedicated to the investment. Be confident, but truthful. These investment groups have been there done that too many times and they have developed exceptional intuition skills – so don’t even think of bluffing your way through.

Due Diligence Is A Slow Process

If you are lucky enough to receive a favorable decision at this level, the angel investment group will then start their due diligence. The due diligence process will vary for different types of companies, but be prepared to have the investment group thoroughly examine every area of your business including the financial, legal, labor, tax, IT, environment and market/commercial situation of your company. They will also be looking into intellectual property, real and personal property, insurance and liability coverage, debt instrument review, employee benefits and labor matters, immigration, and international transactions as well. You should plan on a 3 to 12 month time-frame for this process.
So if you have added all this up, you are looking at a minimum of 6 months and maybe as long as 18 months. Not exactly cash in a flash.
Funding Comes In Stages

If you have survived this far, you will be more than ready to cash that check. Now comes another realization – the funding may come in stages, not all at once. Angel investors are usually groups of high net worth individuals who join together to make the investment. This spreads their risk. It also means that the investment group will have to collect the investment funds from the members of the group and the cash is not sitting in their checking accounts just waiting to be disbursed to you. There may be as many as 10 or 15 individuals putting in an average of $30,000 each to fund the angel group investment. So expect the funding to come in stages, not all at once.

Notice something else – 10 to 15 individuals each putting in $30,000 will only add up to somewhere between $300,000 and $450,000. So the last lesson for today is that your $1,000,000 payday will not be coming from angel investors. That’s the turf of venture capitalists.

Once you learn what to expect from angel investors, you can prepare yourself to fly with the angels. If you need flying lessons, contact Performance Advisors LLC and we can help you with the process and maybe even introduce you to some real live angels in the process.

As fears of a debt crisis in the Eurozone converge with poor economic data from the US, investors turn away from volatile traditional investment assets such as equities and bonds, choosing instead to investigate a range of alternative investments that provide shelter for the value of capital, and are less affected by market ‘noise’.

Here are three alternative investment strategies that are proving popular with investors heading towards 2012.

Coins and Stamps

Numismatic investment (investing in coins) and philatelic Investment (investing in stamps) is one area that is receiving an increased attention. As with many alternative investments, the value of rare coins and stamps is driven by supply and demand. The rarer an item, the greater the value, although with coin investing the value of the metal is also a considered factor in the value of the coin, such as is the case with gold coins for example.

Investing in stamps was popular in the 1970s, but the bubble burst and prices took many years to recover. Investing in stamps, as with any type of investment in collectibles, require in-depth knowledge and skill to identify and value the assets.

With coins, many gold coins are still considered to be legal tender in the UK, and therefore offer tax advantages with regard to capital gains tax.

Timber Investments

Another of my current selection of alternative investments would be to invest in trees. As tress grow no matter what happens in the financial markets, investing in timber plantations, either directly or through an investment fund or timber business, provide the investor with growth whilst the performance of other assets may falter.

Returns from timber investments are three-fold; the majority of return comes from the tree growing into valuable timber over many years, also, the price per unit of timber (usually cubic metres) also rises, with many of the main indices in developed markets showing timber prices rising by around 6% per annum. Finally, in some cases investors may also profit from increases in the value of the land on which the plantation is established.

Forex

The third and final of this small selection of alternative investments is Forex, or foreign exchange. This is a highly risky investment strategy, and can inv9ovle betting for or against the movement in value of one currency against another.

Investors may place their bet per unit of a rise or fall in value, and can easily lose more than the value of their original stake if the currency moves the wrong way.

So, there are a great many alternative investments to consider for the investor keen to divorce the performance of their portfolio from the performance of traditional markets.

According to recent research, institutional investors are holding up to 25% of their investment portfolios in alternatives in an effort to rebuild value lost after the recent economic crisis of 2008.

Download the alternative investments report from DGC Asset Management .

David Garner is Partner at boutique alternative investment boutique DGC Asset Management Limited.

As an online entrepreneur, one thing you learn is that the competition out there is stiff and massive so when you make the first dollar, you deserve one big thumbs up. Now that you’ve minted some money online, my next question is, what are you going to do with it? Buy some online merchandise, pay your bills, save it in your bank account, donate it to a good cause, invest it or plain burn it. Whichever you choose, its still the right choice after all its your money. However, indulge me a little bit and let me show you a different way. I suggest you invest it, why? Because if you invest it, you can still do all the above with your money and some, if not more, of it will still be around to spend when you retire.

First things first, we need to ask and answer each of the following questions:

What is investing?
Who is an investor?
What is an investment?
What do I need to be an investor?
Am I an investor right now?
What should I expect when I invest?

- What is an investment? This is the act of putting money into something, in this case an asset, with the expectation that I will gain something in return.

- Who is an investor? Anyone who takes the risk to investment their money in assets with the sole objective that in the future it will pay back more than what they bought it for. To be an investor you need the financial resources and knowledge on how, where and when to invest.

- What is an asset? An asset is anything that is considered to have economic value. In other words you can exchange it for cash. Simple examples include your car, house, computer, website e.t.c. Cash is also an asset.

- What is a liability? In the context of business a liability is any obligation owed to someone else. Simple example include a loan, unpaid bills etc.

- What is capital? These are the resources required in a business to generate revenue or wealth. Simple examples include money, tools and equipment, premises etc

- What is a share? A share is a single unit of capital. Assuming you have company whose capital is worth $1,000 which in this case is 100% of the capital. A share in that company is worth $1,000/100 = $10.

- Who is a share holder? An individual or legal entity that owns shares in a company. If you own 50% of the company, your shareholding is (50/100 x 1000) x $10 = $500.

- What is a dividend? This is the portion of a company’s profits that is paid to the shareholders. Assuming Company A made $100,000 in profits and its is decided that each share holder will receive $1 per share then if you own 50% of the company you will get $50.

- What is interest? This is the compensation paid for using someone else’ assets or financial resources. Interest rate is usually calculated in percentage.

The one rule of investing you need to know is that there is always a risk involved, you could make or lose money when investing. However, an investor’s job is to mitigate the risk involved and ensure that the chances of making a loss are reduced and those of making money increased.

What are the major investment vehicles available to the layman or beginner investor?

- Stocks or Shares – This is where you buy a part of an existing company, private of public. The return in this class of investment is dividends and capital growth when the stock price goes up or there is a share split or a bonus. These can be purchased at the stock exchange either on the day to day market trading but the best time to enter this market as beginner is when a public company is offering an IPO (Initial Public Offer).

- Collective Investment Funds – In funds, many individual investors pool their money together into a pool fund which the fund manager uses to invest in one or many types of investments like stocks and real estate local and/or off shore on their behalf and also manages the investment portfolio on a day to day basis. The gains made from this portfolio is then divided among the members of the fund depending on how much each has invested into the fund. The biggest benefit in this group is that one gets to invest and benefit from assets, e.g. blue chip counters, that you would not afford if you went into it as an individual.

- Business – Business is the activity of making money or any activity carried out with the main goal being to make a profit. It could be the sale of tangible goods or provision of services. In this case you invest your money in the company that sells the goods and services and in return you get dividends as a shareholder. This is always a good place to start your journey to becoming an investor. There is enough money from the business to start building up an investment portfolio slowly and if you make a mistake and lose money you have a fall back.

- Foreign Exchange or Forex – How would you like to buy currency when is cheap and sell it again when its more expensive. for example if the USD is worth 0.9CAD today, you can buy some and a sell it after a few days or weeks when its worth say 1.1CAD thereby making 0.2CAD per dollar. Suppose you’d invested like a 1,000CAD you’d have made like 100CAD all in one transaction.

Remember, an asset brings income which means the house you live in is not an asset, though your banker might tell you otherwise. However, if you buy a house and rent it out, it becomes an asset. The opposite of asset is liability, so as an investor you should always work towards increasing assets and reducing liabilities. That way your gains increase every day else you’ll be losing money if liabilities are going up and assets down.

Are you an Investor, a Business Owner, an Employee or Self Employed? The investor earns income from his investments, business owner from his businesses, employee a salary working for the business owner, self employed from specialized skills or services to the business owner and investor.

These four individuals ways by which income is earned are part of the Cashflow Quadrant as explained by author/investor Robert Kiyosaki of Rich Dad Poor Dad fame. The Cashflow Quadrant and many more investor self help material available at the Tuwaze Duka. (Duka means ‘a shop’ in Swahili)

I suggest you start by setting some goals at the beginning of the investment journey and then maintain a diary on the investment transactions and decisions you make every day. After several months you can compare and analyze them against the achievements you will have made after several months.

More Free articles available Tuwaze Library.

The EB-5 Investor green card has been introduced with the aim of attracting more foreign investments and creating and preserving jobs in the US. The green card through investment, also known as Fifth Preference, is attainable to those persons who make investments of a certain amount of money, which would have an ameliorating effect on the US economy and would also open up a predetermined number of jobs benefiting qualified personnel within the country.

The amount of the venture capital varies depending on the nature of business it is invested into. Investments of 1 million dollars or more in a new business or aggrandizing an existing business which employs at least 10 US workers are qualified for filing for the EB-5 Investor Visa.

Direct investments of $500,000 or more in certain “targeted employment areas” are also qualified for filing for the EB-5 investor visa. This investment can be utilized to either set up a new business or to purchase and reconstitute an existing business which employs 10 full time US workers. One important detail to be noted here is that family members of the investor cannot be counted among the 10 US workers. If the existing business happens to be a debilitated one, then one may be exempted from the employment requirement of creating 10 jobs.

An interesting feature about the green card through investment is that several investors can join together to create or acquire an existing business. In such a case each investor will qualify for a green card through the single business, although the individual investments of each investor cannot be less than the minimum eligible amount. The number of new jobs to be created then would be the number of investors multiplied by ten.

The investments are to be held in the US for a minimum period of three years. The investor will be subject to US taxation even on his income from other parts of the world. The investor also requires special permission if he needs to remain outside the US for more than one year at a time.

The source of the investment funds can come from any legal foreign or US source. This includes gifts, loans, trusts and even divorce settlements. Investment funds that are borrowed qualify as long as they are not secured through the assets of the EB-5 investment business,

The green card through investment grants permanent residency to the spouse and the offspring (unmarried and under 21 years of age at the time of filing for EB-5 Visa.) of the applicant. This further gives one the option to live, work and retire in the United States. College and University education of the offspring can be availed of at the same cost as for US residents. An investor approved for the EB-5 Visa receives a conditional green card. The only difference between a normal green card and the EB-5 approved green card is that the latter needs to be revalidated or reissued every two years.

In the current climate it is important to hold a diversified portfolio of investments, and not place all of ones eggs into the same metaphorical basket.

As inflation remains high the value of cash diminishes, and so investors seek to acquire assets where the value tracks or beats inflation.

As interest rates are low, investors also require income from the portfolio to replace the lost ‘risk-free’ income from cash deposits.

As markets are volatile, the savvy investor hopes to invest in assets that continue to grow in value steadily, and do not fall in value at the slightest whiff of bad political or economic news.

Here are three types of alternative investments that do not depend on the performance of traditional assets like stocks and shares, bonds, cash or property, and display the characteristics mentioned above.

Farmland Investments

The price of agricultural land is directly related to earnings derived from the land itself. Agricultural real estate assets have been shown in studies of historical data to grow in value at 2% above the rate of inflation.

Arable land also generates annual income from the cultivation and sale of crops, or from lease payments from tenant farmers, replacing lost income when dividends from other investments fall or interest rates are low.

Farmland is in exceptionally high demand as the population grows and demands more food, but supplies of suitable land are actually shrinking due to urbanisation, land degradation and climate change. Returns form farmland investments then are driven by population growth and rising incomes/increased consumption, rather than financial markets, and as these are long-term fundamental trends, farmland generates very little volatility and is not affected by short term peaks and troughs.

Smaller investors find it difficult to access direct farmland investments due to the amount of capital required and the expertise in selecting / managing properties. There are of course farmland investment funds to consider or other, more innovative structures allowing multiple investors a stake in a larger asset through a trust or a bond.

Forestry Investments

Investing in trees used to be a preoccupation of institutional investors like pension funds and hedge funds, but now there are lots of opportunities for smaller investors to participate in direct forestry investments, as well as regulated and unregulated forestry investment funds.

Returns from forestry investments come from the cultivation and sales of timber. As trees continue to grow in size they also grow in value, so returns are driven by biological growth. This means forestry investments retain their value if other assets falter. If the stock market crashes tomorrow (again), trees are still getting bigger and more valuable.

The rate of growth of trees outstrips the rate of inflation by some margin, making forestry investments one of the best performing assets classes for 30 years, avoiding the majority of market volatility that has occurred during that period.
Smaller investors can participate in a forestry investment fund, or they can take ownership of managed plots within commercial forestry plantations growing a variety of different timber types in various global regions from Brazil to Australia.

Renewable Energy Investments

One of the most popular types of alternative investments available today in renewable energy investment. This could be investing in wind turbines, solar panels or biofuel plantations, not to mention a host of other innovative power production projects.

For the most part, renewable energy investments generate returns from the production and sale of electricity from free and unlimited sources such as wind or the sun. This means that income from direct renewable energy investments is not dependent on the markets, and income track energy prices, which rise as demand increases and supplies of traditional fuels run out.

So investing in renewable energy provides an inflation-linked income stream that is not market dependent, and where the source never runs out.

There are of course many other types of alternative investments to consider and investors are encouraged to seek advice from professional advisors that are able to demonstrate and excellent level of knowledge and a verifiable track record.

Download the Alternative Investment Report at the DGC Asset Management website

Many people who are seeing low return on their savings accounts often look to other ways they can increase the returns on their hard earned cash. And why not, money does not grow on trees or anywhere else, and it is only natural that those hours of toil put in at the workplace should translate as a nice profitable return.

Subsequently, many people have looked at the stock market and its various investment vehicles as a way of making the money do the work. One method which is often favoured by all types of investors is investing via an investment fund.

Unless you have an exceptional insight into the stock market, investment funds offer a way of investing into the market without having to pick out individual stocks and shares, which unless you have a good insight into the markets and are a highly experienced player in the game, it is probably a good idea to avoid at least in the first instance.

Investing into an investment fund involves paying into a fund which is already invested into several areas of the market. There are different types of funds which are designed for different types of investor.

A key decision to be made which will affect your investments is how much risk you are willing to take with your money. You are probably familiar with the term risk vs. return and basically the higher risk the potential for a higher, more profitable return. The lower the risk and the return is less but in some instances may offer stable growth.

However, this is a very general description of risk vs. return, as it is possible that a more cautions fund will be prone to high risk factors and vice versa.

If you are an experienced investor you may already know which funds you are going to invest into for the coming year. You will know that a fund can do well one year but no so well the next. Nonetheless, like the beginning investor, you will probably do well to at least obtain guidance on investment funds from a good fund manager.

The key to a good fund manager is to choose one which is happy to only step in when they have to. Many financial companies and advisors step in at every opportunity which is paid for by the investor, and in many instances this is the only reason they do.

Whether you are a beginner, or a seasoned investor, try and find a fund manager or fund management company that is happy for you to have as much control as possible over your fund.

Investment funds offer a good vehicle for investing for the beginner, as well as offering good returns as an investor’s investment.

Richard Teahon writes for http://www.Fundsnet.co.uk which was founded by Chairman Simon Dixon with a view to reduce the cost of financial investing. It offers a variety of financial products, including but not limited to stocks and shares ISAs, consultancy and advice, trust and pension investments, emerging markets, commodities, and unit trusts and OEICs. The product range was created to suit every type of investor.

For the new investor, participating in the stock market can be a daunting experience. Lack of knowledge and risk assessment are the major issues that face every investor, especially the beginner. Here are some ideas to consider:

Know before you go. Information is valuable. You would do well to learn about the area of investing in which you have interest. The library, the bookstore and the internet are good resources for gaining knowledge. A basic understanding of how things work will allow you to take your first steps with a greater degree of comfort.
Understand the process. Everything has a beginning, a middle and an end. What are the practical circumstances that may affect your risk and your value? How do they occur and when? Try to avoid following others blindly. Their situation may not be the same as yours. It is better to rely on your own knowledge and to build your experience level.
Read the prospectus. An investment fund has a prospectus which describes not only the objective of the fund but also the portfolio, the fees and charges incurred, the management, the nature of the risk, the valuation process, and how you put your money in and take your money out. There is an ongoing effort to make prospectuses easier for the public to read. Take some time to over the basics.
Ask questions. Someone besides you has asked the same questions before. The investment company, the broker, the regulatory organization or an informed third party knows the answer. Follow up on your concerns until you are satisfied.
Start small. You are more likely to make mistakes in the first part of your learning curve. Keep your investments small. You will pay a lower price for the cost of learning. Investing is not a guaranteed activity. Seasoned investors lose money–usually because of a risk taken rather than because they lack knowledge. Informed risk-taking is better than uninformed risk-taking. Small losses are better than big losses.
Start simple. There are many investments and strategies that are complicated. Invest in what you understand. It is not enough that someone has explained how things work. You should understand the investment completely. “I didn’t realize that could happen,” is not a pleasant admission for an investor.
Choose a suitable investment. What is your tolerance for risk? Everyone has their own answer. Determine your comfort zone and make sure that the investment choice matches. A good investment is one that you can stay with over a longer period of time.
Set a goal. How much is enough? What is reasonable? Ask yourself what you want from your investment and what is your time frame. Periodically assess your progress toward the goal. Are you on track or should you change your expectations? Further research may help you answer these questions.
Assume responsibility. When you invest your money, you are responsible for what happens. Someone else may have given you information or advice but, in the end, the results are yours. Taking ownership of your choices heightens your level of interest and understanding. You also gain useful experience.
Admit errors and make changes. Sometimes impulse prevails over reason or you make a wrong choice. A small mistake is better than a big mistake. Be honest with yourself and take action.
Follow your own advice, avoid the herd. The herd mentality doesn’t take your situation into account. Examine your investment choices from your own vantage point:–what is good for you.
Become your own expert. Information or advice from others is often incomplete or misleading. Do your own research and assessment. Develop your own reasons for making choices. When it comes to your money, you will take the best care.

Howard Feigenbaum is Registered Principal and Owner of Sharemaster, a Broker-Dealer firm that specializes in monthly dividend income funds.

http://www.monthlydividendcheck.com/

Women really do make great investors. Why? Because investing is about more than just math and numbers.

Women are becoming more and more deeply invested in their own financial success for many reasons: Careers are being pursued and marriage is being delayed, divorce rates are higher than ever, single-moms and women who are the sole or main breadwinner in the family are increasing, cost of living is rising steadily, job security is virtually non-existent…the list goes on. There are no guarantees in life and situations can change drastically in the blink of an eye. Independence and self-sufficiency are more than just words; they are a gateway to freedom. Women are no longer content or willing to be dependent on others for their quality of life.

A lot of the Myths about Women and Money floating around out there are simply false. Statistics show that women are blowing the stereotypes out of the water when it comes to money and investing: Women are MORE likely to join a retirement plan, women save on average 10% MORE than men, women actually spend LESS than men, and women are MORE likely to diversify their investment portfolio.

True power and independence happen not when you HAVE money, but when you know how to MAKE money.

Just ask any lottery winner or divorcee who has blown through a divorce settlement trying to sustain a champagne lifestyle on a beer budget! A lump-sum goes away pretty fast when there is nothing in place to replenish it. The first step is learning about Assets & Liabilities; the next step is doing something with that knowledge.

As Rich Woman Coach Nichole explains in a video Coaching Tip about Women and Investing on Robert Kiyosaki’s Rich Dad website, there’s a lot more to successful investing than just numbers and calculations. The Rich Woman coaches identified their top 5 characteristics that make women great investors:

Asking for help
Planning
Multitasking
Diligent research
Value shopping

Let’s take a closer look at these strengths, how they each contribute and add up to a Great Investor Profile:

Asking for Help. Women typically know how to ask for help when they know they need it. And in my experience, more often than not, they prefer to ask other women. Have you noticed all the networks and clubs and resources that are geared towards supporting women in financial and business endeavors? The Daily Worth, WomenOwned.com, Ladies Who Launch, National Association of Women Business Owners (NAWBO), My Wealth Spa to name a few. Many of these were created or developed just in this past decade.

Women seek and value mentors that can support and assist them in a non-intimidating, non-judgmental forum. Although men often view women’s lunchtime or evening gatherings as a sewing circle gossip session, women frequently use friends and colleagues as sounding boards for new ideas, thoughts and perspectives. Brainstorming and round-table sessions are becoming more and more mainstream, even in the ‘Old Boys Club’ organizations because there is strength and power in teams and in seeking outside opinions and help.

Planning. Most women become good planners by necessity. Often in addition to full-time employment or business ownership, women take on, or inherit by default, the monumental task of running the household, juggling kids activities, making and keeping family appointments, planning and organizing family vacations, meals, etc. It takes a lot of planning and organization to make sure everything runs smoothly from day to day and week to week.

Investing demands a similar kind of planning and organization to be efficient and get the most out of your capital. The ability to make and stick to short and long-term goals is important but having a system to monitor and track it all is priceless, especially when it comes to finance and investing.

Multitasking. Women are also known to be exceptional multitaskers. Handling several issues or tasks at once is all in a day’s work for most women. This translates well into the world of investing because there are always many different things going on in many different markets and across many different asset classes.

Women who are able to see various market factors and how they can affect an investment will be much more able to predict possible outcomes and proactively make adjustments as needed. Diversification is also easily appreciated and accepted by women who are more likely to hedge their bets as opposed to going for the glory in a single ‘Hail Mary’ home-run move.

Diligent Research. Women know how to do their homework. They are used to budgeting, comparing prices, finding the right pediatrician, school, camp, mechanic, gardener, insurance, etc. In finance and investing, this means that women know how to investigate and identify investments that will work best for them.

Investing involves a LOT of research. ‘Due Diligence’ is an investment term that refers to the process of verifying data presented, investigating the investment parameters and terms so that the investor can make an educated decision to purchase or decline. As a real estate investor, I screen and analyze literally hundreds of properties before finally deciding to offer in on one or two. Diligently investigating the investment and the people involved is a crucial step in protecting your investment funds up front and finding a good fit for your specific purposes.

Value Shopping. Warren Buffet once said, “Price is what you pay; value is what you get.” Women seem to intrinsically know how to stretch a budget and shop for bargains. They are aware of what’s available, what the going rates are and will go clear across town to get something at a discount. Women know that it makes sense to get a designer gown at half price if they are willing to find and sew on a couple of missing buttons.

Investing for value or value-add opportunity follows the same principles as shopping for any kind of bargain. You need to have a good idea of the general market value so that you have a benchmark to evaluate the investment you are looking to purchase and know when it’s priced below its true value, or when a few simple steps are all it takes to realize its potential (add value, like sewing on a button). Once you know what to look for, it gets easier to spot the gems.

Finance and investing may seem like a spider’s web of intricacy and detail but understanding the rules and knowing how to filter out the junk makes it a lot easier. Women have the skills and qualities to excel in the investment arena on their own terms. Women really do make great investors!

“A woman is like a tea bag; you never know how strong she is until you put her in hot water.” ~ Eleanor Roosevelt ~

Jacqueline Ross, CCIM is an experienced investor, educator and real estate professional. She founded Investment Strategies, Inc. to work with property owners and investors nationwide to achieve personal and financial goals through real estate and related investments. Sign up to receive eNews updates and learn more about strategies that can help manage risk, create additional income, tap into and activate ‘lazy’ equity, maximize retirement fund potential, truly diversify investment portfolios and build wealth.

By now you probably know that it takes a lot of learning and experience to be a successful investor. For many this would probably also mean learning the hard way i.e. losing money in the stock market. There are some fundamentals in your learning journey that you need to be aware of. I will share with you five tips on how you can make your stock market investment more successful.

The beginning of the journey. What is your end goal? What do you wish to achieve (e.g. how much do you want to make in 5 years)? These are some of the basic framework that you need to keep in mind. How much do you need to set aside for rainy day? How much can you set aside to invest in stock? We are not yet getting into buying stock, but first understanding your financial journey, hopefully on your way to make enough money to an early retirement. If you talk to a financial consultant they will be able to give you a basic idea of your financial situation. If you are looking at better managing your expenses, so that you have more money left to invest, there are many smart phone applications that can do just that. They help you identify and track your major expenses all the way down to the little ones that often slip our radar, and we all know they can add up to a significant amount. Being able to better manage your expense will provide you with more cash to invest.

The analysis. Stock investment is a fine combination of science (the investment fundamentals) and art (qualitative analysis). There are many resources available for you to pick up on learning the fundamentals of stock investment. However, the science of investing itself is not a simple subject to pick up let alone be an expert at it. The market erratic behavior is also something that you cannot pick up from the text book. This leads to the second piece of the jigsaw puzzle, the art piece. It is how you combine the skill of stock market science with the art of qualitative analysis, example to define when you should sell the stock.

Know yourself, your friends and enemies. What is your risk appetite? Are you the adventurous risk adverse, or you belong to a careful investor who prefers to keep your risk to a minimal. Nobody knows you better then yourself. Start with a strategy that you feel comfortable with. Be aware that there are many ‘news’ making its round in the market. Do not be blindly lead into the ‘news’ or some call it gossip. Do your fundamental analyses before you jump into a decision.

Stay the course. Stock investment is a journey and it pays to stay the course, especially when you know that you have done your due diligent. You may not see enough actions (missing out on making quick money) in the short term, but you will tend to reap better benefits holding up in the longer term.

Education. The market is uncertain and changing all the time. Invest both time and money to upgrade your skill. Education will certainly pays off, however, remember one must learn to take action after upgrading your skill, so that you can see improvement to your life.

Adhering to above strategy requires a lot of self discipline and a strong will. You are more certain to reap the benefits in your stock market investment journey if you can do that.

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