SECRET FEES MAKE MUTUAL FUNDS BILLIONS AT YOUR EXPENSE! by Dr. Scott Brown, Ph.D.
Many investors think that investing in mutual funds is free. What nonsense! Funds collect more than $50 billion a year in fees from investors. That is truly a ton of money. The first way you get hosed in a mutual fund is due to high fees charged. These fees can dramatically reduce your returns over time!
The way that these fees are deducted automatically from a fund’s returns makes them invisible because you never see an invoice or have to write a check. If you invest $10,000.00 in a domestic stock mutual fund with an expense ratio of 2% and a sales load of 3%, and let’s imagine that you get annual returns of 7.5% for twenty years, your money would almost triple to $27,508.00.
The bad news is that you would have lost $14,970 in fees and foregone earnings over the twenty years. Yikes…that really hurts! Why not just bypass the system and buy your own stocks as I teach finance students and home study investors?
These funds are also sold and managed on pure hype, short term trading, and with key information withheld from the public. All of these factors I teach finance students and investors to avoid! The industry confuses investors by focusing on past performance, which should not be a factor to consider. Many mutual funds are able to cheat the public with excessive fees because investors don’t understand how these big costs destroy their profit. Mutual funds have no interest in educating investors because it is easier to hoodwink the ignorant!
Don’t put your trust in mutual funds unless they are fully indexed. Indexing means that the mutual fund simply uses a computer to buy and sell stocks in the mutual fund portfolio so as to mimic the composition of a major stock market index like the S&P 500. This means that there is no fund manager sucking out needless fees. A good example is the first fully indexed mutual fund called the Vanguard 500 (VFINX) which is also now the largest of its kind.
About the Author
ABOUT THE AUTHOR: Dr. Scott Brown, Ph.D., the Wallet Doctor, is a successful investor. Dr. Brown holds a Ph.D. in finance. The Wallet Doctor is sought after for investment advice and coaching. For more information visit Dr. Brown’s site at www.BonanzaBase.com or sign up for his investment tips at www.WalletDoctor.com
Wednesday, July 27, 2005
Monday, July 25, 2005
Are You Really A Twenty First Century Investor?
Are You Really A Twenty First Century Investor?
Real Estate Investors that educate themselves about CURRENT MARKET TRENDS will reap huge returns NOW!!! Information concerning NEW TRENDS in financial resources will open new and more profitable real estate opportunities for your business.
Today’s residential real estate market for investors has become very competitive in most major markets. The vast majority of real estate investing seminars and clubs are encouraging you to search out desperate home owners or distressed properties to be rehabbed.
Not to mention the fact that today’s disillusioned stock investors have now realized that residential real estate investing offers better returns, with less capital risks. As you seek to identify your lucrative real estate opportunities, have you noticed that the good deals are getting harder to find? I am not here to discourage you from investing in real estate, but would like to share real estate investment opportunities and information with you…..opportunities that only a few people are aware of and regularly participate in. That’s right; I am referring to a niche investment market that has VERY LITTLE competition. This unique information is currently setting new trends within the commercial real estate investment community!
I know you are ready for me to tell you about this quiet niche investment market, so I will...... it is….……. ………..Commercial Real Estate. There are HUNDREDS, maybe THOUSANDS of niche market investment opportunities within Commercial Real Estate. And by the way........ the main reason why so few investors go after commercial real estate, and that might include yourself, is that you're not convinced that you would qualify for commercial financing ! ! Most investors are lead to believe that a 20% down payment is required to start the process for purchasing commercial properties. WELL, THIS IS NOT TRUE!
Let’s do the math now…… financing a property that cost $5 Million dollars with 20% down would require you to put down $1,000,000 and you would still have to add in legal fees and closing costs. Yes, I know that only a few investors or even investment groups are able to meet these down payment requirements. Your first mistake as an investor would be to go to your local bank to seek financing, or worse, go to private or hard money lenders. First, remember the banks are regulated by the federal government and they are required to underwrite conforming loans and second, bank loans tend to be very structured and are generally inflexible to your project needs. In most cases, THESE LOANS will require a 20% DOWN PAYMENT OR MORE! The only benefit of using private or hard money lenders is when" NO OTHER FINANCING OPTIONS EXIST FOR YOU!"
FINANCING is the key ingredient to identifying lucrative real estate investment opportunities, yet, so few people truly understand the power of knowing WHERE to find the right financing and HOW to get it! WHAT IF you had several lenders, today, that would only require you have 2 to 3% down payments (on certain qualified projects)… WOULD THIS BE OF INTEREST TO YOU? A $5,000,000 loan with 2- 3% down payment equates to putting down $100,000 to $150,000. As an individual investor, this down payment would still be pretty steep for you however, today, many residential investors are already joining and forming Investment clubs to increase and enhance their purchasing power. TO ALL residential real estate investors....... the REAL MESSAGE here is that you are closer to buying commercial real estate than you think! This example should make it clear to you that finding the right financing is the FIRST step and the key ingredient to your real estate investing…….. however, there is a PROBLEM.
The problem is that as an investor, you have been trained to shop for properties FIRST, and almost never for financing. Finding the right financing FIRST will save you and make you more money over time, than you purchasing the undervalued properties and selling them later at or above market prices. I will repeat this….. MOST REAL ESTATE INVESTORS DO NOT UNDERSTAND THE IMPORTANCE OF FINANCING within the investment equation. The ability to save on the amount of the interest rate you are being charged…. month after month….. year after year… 2 or 3 % or more is huge. You may also find out what I already know….. . by securing the financing first…..THIS OPENS UP NEW INVESTMENT OPPORTUNITIES!
Let’s review some of the BENEFITS that come with purchasing Commercial Real Estate:
1. Unlike residential real estate, commercial real estate’s only purpose is to make money for its investors. If there was a 7% cap rate on the $5,000,000 sample property, it would cash flow $350,000 annually.
2. Do you think you would enjoy having professional tenants with long term leases?
3. Would it excite you if your investment projects qualify for Non recourse financing?
4. You can totally eliminate the process of rehabbing properties.
5. How about this…… YOU no longer have to chase tenants down to collect rent.
6. You no longer have to pay penalties to lenders for not being in owner occupied properties.
7. Expand your investment search throughout all 50 states.
8. Last and probably the MOST BENEFICIAL of all of the perks….You can qualify to purchase these properties using your commercial tenant's credit rating, business cash flow and their long-term rental leases!
In an era where information rules, the small to medium sized real estate investor can NOW be a "Front Runner" AND a major player within the commercial real estate market!, says Steven Battle
We are searching for like -minded real estate investors and investment clubs that would like to join a Commercial Real Estate Investor Forum. We welcome that you come and ask your commercial financing questions and share your investment experiences with the group. Go to www.amoneybroker.com/ and click on "Join Our Investor Forum."
About The Author
Steven Battle, Commercial Financing Specialist with Amoneybroker.com, has over twenty years of experience in financing, property management, real estate investing, and direct sales.
www.amoneybroker.com/
Real Estate Investors that educate themselves about CURRENT MARKET TRENDS will reap huge returns NOW!!! Information concerning NEW TRENDS in financial resources will open new and more profitable real estate opportunities for your business.
Today’s residential real estate market for investors has become very competitive in most major markets. The vast majority of real estate investing seminars and clubs are encouraging you to search out desperate home owners or distressed properties to be rehabbed.
Not to mention the fact that today’s disillusioned stock investors have now realized that residential real estate investing offers better returns, with less capital risks. As you seek to identify your lucrative real estate opportunities, have you noticed that the good deals are getting harder to find? I am not here to discourage you from investing in real estate, but would like to share real estate investment opportunities and information with you…..opportunities that only a few people are aware of and regularly participate in. That’s right; I am referring to a niche investment market that has VERY LITTLE competition. This unique information is currently setting new trends within the commercial real estate investment community!
I know you are ready for me to tell you about this quiet niche investment market, so I will...... it is….……. ………..Commercial Real Estate. There are HUNDREDS, maybe THOUSANDS of niche market investment opportunities within Commercial Real Estate. And by the way........ the main reason why so few investors go after commercial real estate, and that might include yourself, is that you're not convinced that you would qualify for commercial financing ! ! Most investors are lead to believe that a 20% down payment is required to start the process for purchasing commercial properties. WELL, THIS IS NOT TRUE!
Let’s do the math now…… financing a property that cost $5 Million dollars with 20% down would require you to put down $1,000,000 and you would still have to add in legal fees and closing costs. Yes, I know that only a few investors or even investment groups are able to meet these down payment requirements. Your first mistake as an investor would be to go to your local bank to seek financing, or worse, go to private or hard money lenders. First, remember the banks are regulated by the federal government and they are required to underwrite conforming loans and second, bank loans tend to be very structured and are generally inflexible to your project needs. In most cases, THESE LOANS will require a 20% DOWN PAYMENT OR MORE! The only benefit of using private or hard money lenders is when" NO OTHER FINANCING OPTIONS EXIST FOR YOU!"
FINANCING is the key ingredient to identifying lucrative real estate investment opportunities, yet, so few people truly understand the power of knowing WHERE to find the right financing and HOW to get it! WHAT IF you had several lenders, today, that would only require you have 2 to 3% down payments (on certain qualified projects)… WOULD THIS BE OF INTEREST TO YOU? A $5,000,000 loan with 2- 3% down payment equates to putting down $100,000 to $150,000. As an individual investor, this down payment would still be pretty steep for you however, today, many residential investors are already joining and forming Investment clubs to increase and enhance their purchasing power. TO ALL residential real estate investors....... the REAL MESSAGE here is that you are closer to buying commercial real estate than you think! This example should make it clear to you that finding the right financing is the FIRST step and the key ingredient to your real estate investing…….. however, there is a PROBLEM.
The problem is that as an investor, you have been trained to shop for properties FIRST, and almost never for financing. Finding the right financing FIRST will save you and make you more money over time, than you purchasing the undervalued properties and selling them later at or above market prices. I will repeat this….. MOST REAL ESTATE INVESTORS DO NOT UNDERSTAND THE IMPORTANCE OF FINANCING within the investment equation. The ability to save on the amount of the interest rate you are being charged…. month after month….. year after year… 2 or 3 % or more is huge. You may also find out what I already know….. . by securing the financing first…..THIS OPENS UP NEW INVESTMENT OPPORTUNITIES!
Let’s review some of the BENEFITS that come with purchasing Commercial Real Estate:
1. Unlike residential real estate, commercial real estate’s only purpose is to make money for its investors. If there was a 7% cap rate on the $5,000,000 sample property, it would cash flow $350,000 annually.
2. Do you think you would enjoy having professional tenants with long term leases?
3. Would it excite you if your investment projects qualify for Non recourse financing?
4. You can totally eliminate the process of rehabbing properties.
5. How about this…… YOU no longer have to chase tenants down to collect rent.
6. You no longer have to pay penalties to lenders for not being in owner occupied properties.
7. Expand your investment search throughout all 50 states.
8. Last and probably the MOST BENEFICIAL of all of the perks….You can qualify to purchase these properties using your commercial tenant's credit rating, business cash flow and their long-term rental leases!
In an era where information rules, the small to medium sized real estate investor can NOW be a "Front Runner" AND a major player within the commercial real estate market!, says Steven Battle
We are searching for like -minded real estate investors and investment clubs that would like to join a Commercial Real Estate Investor Forum. We welcome that you come and ask your commercial financing questions and share your investment experiences with the group. Go to www.amoneybroker.com/ and click on "Join Our Investor Forum."
About The Author
Steven Battle, Commercial Financing Specialist with Amoneybroker.com, has over twenty years of experience in financing, property management, real estate investing, and direct sales.
www.amoneybroker.com/
Thursday, July 21, 2005
Real Estate Bankruptcy
Real Estate Bankruptcy
Although real estate bankruptcy cases no longer dominate the bankruptcy courts' dockets as they did in the early nineties, but they continue to be filed with great frequency in UK. At its essence, the real estate bankruptcy is a two party dispute between mortgagee and mortgagor. Real estate bankruptcy cases are typically filed after a foreclosure sale has been set. Upon learning of the bankruptcy filing, a secured creditor has a number of available options, all or some of which should be exercised, depending on the facts of the case, to maximize loan recovery.
A lender can ask the court to dismiss the bankruptcy case as a "bad faith" filing. A creditor asserting bad faith must prove the subjective bad faith of the debtor and that any reorganization by the debtor is objectively futile. For subjective bad faith, the court will examine whether the debtor invoked the protections of the Bankruptcy Code without either the intention or ability to reorganize its financial affairs. To determine objective futility, the court will examine whether there is indeed a "going concern" to preserve and whether there is any realistic chance for the debtor to reorganize. Most courts require a very strong showing to dismiss a case for bad faith at the outset of a case.
Under the Bankruptcy Code a motion for relief from stay will also be granted where the secured creditor can prove that there is no equity in the real property over and above the secured claims, and that the property is not necessary to the debtor's effective reorganization. This basis for relief is typically alleged as an alternative to bad faith, in the same motion. Almost all controversies surround the value of the real property, making the expert report and testimony of a licensed real estate appraiser essential to the successful prosecution of a motion for relief from the automatic stay on these grounds. The same factors relied upon to support objective futility in the bad faith filing analysis are used to establish that the property is not necessary to an effective reorganization.
An alternate ground for relief from the automatic stay is lack of adequate protection of the secured creditor's interest in the property. For example, if the real property is deteriorating in value and the lender is not receiving post-petition payments, the lender's security interest in the property is not adequately protected. A creditor holding a properly perfected assignment of rents has a lien on "cash collateral" under the Bankruptcy Code. If the assignment of rents was properly perfected pre-petition, it usually attaches to the post-petition rents generated by the debtor's real property. A debtor may not use cash collateral without either a court order or the consent of the secured creditor. While it is common in nonsingle asset realty cases for a debtor to negotiate a cash collateral agreement with the secured creditor before filing for bankruptcy, in single asset real estate cases, which are typically filed at the eleventh hour for the express purpose of stopping a foreclosure, such negotiations are virtually nonexistent.
Unless, within the first day or two of the case, the debtor requests a cash collateral agreement with the lender, or files a motion with the court to authorize the debtor's use of post-petition rents, a lender should immediately advise the debtor in writing that it may not use cash collateral absent an agreement. If an agreement is not reached, the debtor will usually petition the court for authorization on an emergency basis. The lender can also petition the court to deny authorization on the basis that the debtor lacks the ability to adequately protect its interests in the rents. In the final analysis, most secured creditors share the same objective when faced with a real estate case: to extract their collateral, including rents, from the bankruptcy as quickly and inexpensively as possible.
About The Author
Writer of this article is working as a webmaster of www.ukadvice.com. Also writes business related articles for different article sites. For further details and free bankruptcy advice:
Naylor Parkes Associates Ltd.
Lawford House, Lawford Close
Birmingham
B7 4HJ
West Midlands
United Kingdom.
http://www.ukadvice.com
Although real estate bankruptcy cases no longer dominate the bankruptcy courts' dockets as they did in the early nineties, but they continue to be filed with great frequency in UK. At its essence, the real estate bankruptcy is a two party dispute between mortgagee and mortgagor. Real estate bankruptcy cases are typically filed after a foreclosure sale has been set. Upon learning of the bankruptcy filing, a secured creditor has a number of available options, all or some of which should be exercised, depending on the facts of the case, to maximize loan recovery.
A lender can ask the court to dismiss the bankruptcy case as a "bad faith" filing. A creditor asserting bad faith must prove the subjective bad faith of the debtor and that any reorganization by the debtor is objectively futile. For subjective bad faith, the court will examine whether the debtor invoked the protections of the Bankruptcy Code without either the intention or ability to reorganize its financial affairs. To determine objective futility, the court will examine whether there is indeed a "going concern" to preserve and whether there is any realistic chance for the debtor to reorganize. Most courts require a very strong showing to dismiss a case for bad faith at the outset of a case.
Under the Bankruptcy Code a motion for relief from stay will also be granted where the secured creditor can prove that there is no equity in the real property over and above the secured claims, and that the property is not necessary to the debtor's effective reorganization. This basis for relief is typically alleged as an alternative to bad faith, in the same motion. Almost all controversies surround the value of the real property, making the expert report and testimony of a licensed real estate appraiser essential to the successful prosecution of a motion for relief from the automatic stay on these grounds. The same factors relied upon to support objective futility in the bad faith filing analysis are used to establish that the property is not necessary to an effective reorganization.
An alternate ground for relief from the automatic stay is lack of adequate protection of the secured creditor's interest in the property. For example, if the real property is deteriorating in value and the lender is not receiving post-petition payments, the lender's security interest in the property is not adequately protected. A creditor holding a properly perfected assignment of rents has a lien on "cash collateral" under the Bankruptcy Code. If the assignment of rents was properly perfected pre-petition, it usually attaches to the post-petition rents generated by the debtor's real property. A debtor may not use cash collateral without either a court order or the consent of the secured creditor. While it is common in nonsingle asset realty cases for a debtor to negotiate a cash collateral agreement with the secured creditor before filing for bankruptcy, in single asset real estate cases, which are typically filed at the eleventh hour for the express purpose of stopping a foreclosure, such negotiations are virtually nonexistent.
Unless, within the first day or two of the case, the debtor requests a cash collateral agreement with the lender, or files a motion with the court to authorize the debtor's use of post-petition rents, a lender should immediately advise the debtor in writing that it may not use cash collateral absent an agreement. If an agreement is not reached, the debtor will usually petition the court for authorization on an emergency basis. The lender can also petition the court to deny authorization on the basis that the debtor lacks the ability to adequately protect its interests in the rents. In the final analysis, most secured creditors share the same objective when faced with a real estate case: to extract their collateral, including rents, from the bankruptcy as quickly and inexpensively as possible.
About The Author
Writer of this article is working as a webmaster of www.ukadvice.com. Also writes business related articles for different article sites. For further details and free bankruptcy advice:
Naylor Parkes Associates Ltd.
Lawford House, Lawford Close
Birmingham
B7 4HJ
West Midlands
United Kingdom.
http://www.ukadvice.com
Retirement is never urgent until...
Retirement is never urgent until...
If you’re like many people, your retirement savings have not been growing consistently over the years. We’re not referring to the wild fluctuations in the stock market, but rather the fluctuations in our short-term needs. Every once in a while, it just seems like a good idea to yank ALL those retirement savings out and pay for something.
You might need to pay for a down payment. You might need to pay off some credit card debt that’s nagging at you. You might want to ‘bugger off to Europe’ as Rick did some years ago. You know it’s not a good idea financially, but you do it anyway. Retirement savings are not designed to bail us out when we need this kind of short-term cash infusion but if it’s there…
As financial advisors, we have our ideals. Ideally, you should put retirement funds away and ‘leave it there’. Ideally you should never touch it at all, even when you retire! Why? Because it is the ‘earnings’ from the nest egg that you should be using, never the principal. As we heard one person suggest recently, your principal is like your ‘goose’, and you never kill the goose, because then you’re eliminating all those future ‘golden eggs’ (interest/earnings) it will lay.
As financial advisors, one way we try to prevent people from yanking out their retirement savings is by ensuring there are other ‘short-term’ funds available for emergencies. These are meant to act as a buffer zone against the yankers. It helps, but it doesn’t always work.
One problem is that a distant retirement will never be more urgent than the current cash demands you have. It’s impossible. How can long-term demands be more urgent than a current crisis? So what stops you from yanking out those retirement funds? Their convictions? Simple arithmetic? A more viable alternative?
When a client is bent on yanking out their retirement savings to pay off, for example, some credit card debt, telling them how much they’re going to lose in retirement income in 25 years time doesn’t seem to work. Even telling them how much the tax bill is going to be next year can pale in comparison to the relief the person is seeking from the anxiety over their current debt crisis.
So, the question is how can we provide ‘relief’ and still keep the retirement funds intact? Look at a debt consolidation loan? Review the person’s cash flow and create a debt repayment program? Maybe this will work for a minority of people. In the real world, when people are looking for relief, however, they are looking for relief NOW!!! The easiest way is to yank to retirement funds and be done with it.
So, in the moment, when you are in a cash crunch and seemingly have no other place to go, you will yank your retirement savings. Unless you have anticipated the problem and ‘pre-decided’ that under no circumstances will you access your retirement savings. In this way, you will do a pre-emptive strike on bad financial moves. Further, you will be cognizant of putting yourself into situations where you might risk those long term savings.
The alternative is to invest long-term, make progress, encounter a short-term cash crunch, yank out your retirement funds, survive the problem, invest long-term again, make progress, encounter yet another short-term cash crunch, yank out your retirement funds to get relief…
If you’re locked into an investment cycle like this, your retirement savings have not been growing consistently over the years, and it’s not just the market.
About The Author
Rick Hoogendoorn has been in the financial services business since 1991. Cheri Crause is a certified financial planner in Victoria, BC. .
www.chericrause.com
If you’re like many people, your retirement savings have not been growing consistently over the years. We’re not referring to the wild fluctuations in the stock market, but rather the fluctuations in our short-term needs. Every once in a while, it just seems like a good idea to yank ALL those retirement savings out and pay for something.
You might need to pay for a down payment. You might need to pay off some credit card debt that’s nagging at you. You might want to ‘bugger off to Europe’ as Rick did some years ago. You know it’s not a good idea financially, but you do it anyway. Retirement savings are not designed to bail us out when we need this kind of short-term cash infusion but if it’s there…
As financial advisors, we have our ideals. Ideally, you should put retirement funds away and ‘leave it there’. Ideally you should never touch it at all, even when you retire! Why? Because it is the ‘earnings’ from the nest egg that you should be using, never the principal. As we heard one person suggest recently, your principal is like your ‘goose’, and you never kill the goose, because then you’re eliminating all those future ‘golden eggs’ (interest/earnings) it will lay.
As financial advisors, one way we try to prevent people from yanking out their retirement savings is by ensuring there are other ‘short-term’ funds available for emergencies. These are meant to act as a buffer zone against the yankers. It helps, but it doesn’t always work.
One problem is that a distant retirement will never be more urgent than the current cash demands you have. It’s impossible. How can long-term demands be more urgent than a current crisis? So what stops you from yanking out those retirement funds? Their convictions? Simple arithmetic? A more viable alternative?
When a client is bent on yanking out their retirement savings to pay off, for example, some credit card debt, telling them how much they’re going to lose in retirement income in 25 years time doesn’t seem to work. Even telling them how much the tax bill is going to be next year can pale in comparison to the relief the person is seeking from the anxiety over their current debt crisis.
So, the question is how can we provide ‘relief’ and still keep the retirement funds intact? Look at a debt consolidation loan? Review the person’s cash flow and create a debt repayment program? Maybe this will work for a minority of people. In the real world, when people are looking for relief, however, they are looking for relief NOW!!! The easiest way is to yank to retirement funds and be done with it.
So, in the moment, when you are in a cash crunch and seemingly have no other place to go, you will yank your retirement savings. Unless you have anticipated the problem and ‘pre-decided’ that under no circumstances will you access your retirement savings. In this way, you will do a pre-emptive strike on bad financial moves. Further, you will be cognizant of putting yourself into situations where you might risk those long term savings.
The alternative is to invest long-term, make progress, encounter a short-term cash crunch, yank out your retirement funds, survive the problem, invest long-term again, make progress, encounter yet another short-term cash crunch, yank out your retirement funds to get relief…
If you’re locked into an investment cycle like this, your retirement savings have not been growing consistently over the years, and it’s not just the market.
About The Author
Rick Hoogendoorn has been in the financial services business since 1991. Cheri Crause is a certified financial planner in Victoria, BC. .
www.chericrause.com
Wednesday, July 20, 2005
Financial Goals
Setting Financial Goals
Setting goals is difficult enough without adding the word finance in the mix. Many people are reluctant to tackle the task of determining financial goals. Unfortunately failing to do so can have an adverse effect on achieving a comfortable lifestyle later on in life. This article helps to guide you in successfully determining financial goals that you can actually achieve.
Before setting your financial goals there are 3 simple rules that must be followed. You will first need to learn to how effectively control your day-to-day financial affairs. Consistently doing this will allow you to do the things in life that bring you satisfaction and enjoyment. This is commonly referred to as making a budget. The next requirement is to choose a course of action that you can follow to financial success. Finally you must build a financial safety net such as a personal savings account or retirement investment.
Simple Steps To Setting Financial Goals
Step 1 - Identify and write down your financial goals. This will help you visualize your dreams and desires in the form of goals. This can include saving to send your children to college, buying a new car, saving for a down payment on a house, going on vacation, paying off high interest credit card debt, or planning for your retirement.
Step 2 – Take the time to break down your financial goals into several smaller more manageable time driven steps. These include short-term (less than 1 year), medium-term (1 to 3 years) and long-term (5 years or more) goals. Doing this simple task will make your goal setting process easier and more attainable.
Step 3 – Educate, Educate, Educate – Spend some time doing your research on financial topics. Read magazines and books on finance related subjects such as investing. Surf the Internet's for investment web sites and don’t be afraid to learn about the stock market.
Step 4 – Periodically check your progress through a self-evaluation. You’ll want to check your progress monthly, quarterly, or at any other interval you feel comfortable with, but at least semi-annually, in order to confirm that your program is working. If you're not making a satisfactory amount of progress on a particular goal, re-evaluate your approach and make changes as necessary.
Remember there are no hard and fast rules for implementing a financial plan. It is okay to dare to dream about riches, just be realistic about what you can actually do. When you write your goals down for your visualization process you will identify any that seem unobtainable and quickly see the more realistic goals that will lead you to financial success. The important thing is to at least do something as opposed to nothing, and to start NOW.
Timothy Gorman is a successful webmaster and publisher of Best-Free-Insurance-Quotes.com. He provides insurance information and offers discount auto, life and home insurance that you can research in your pajamas on his website.
Other websites operated by Tim
Military-Loans-Online.com – Which provides free money saving loan quotes on all of your loan needs to include home equity loan information.
Setting goals is difficult enough without adding the word finance in the mix. Many people are reluctant to tackle the task of determining financial goals. Unfortunately failing to do so can have an adverse effect on achieving a comfortable lifestyle later on in life. This article helps to guide you in successfully determining financial goals that you can actually achieve.
Before setting your financial goals there are 3 simple rules that must be followed. You will first need to learn to how effectively control your day-to-day financial affairs. Consistently doing this will allow you to do the things in life that bring you satisfaction and enjoyment. This is commonly referred to as making a budget. The next requirement is to choose a course of action that you can follow to financial success. Finally you must build a financial safety net such as a personal savings account or retirement investment.
Simple Steps To Setting Financial Goals
Step 1 - Identify and write down your financial goals. This will help you visualize your dreams and desires in the form of goals. This can include saving to send your children to college, buying a new car, saving for a down payment on a house, going on vacation, paying off high interest credit card debt, or planning for your retirement.
Step 2 – Take the time to break down your financial goals into several smaller more manageable time driven steps. These include short-term (less than 1 year), medium-term (1 to 3 years) and long-term (5 years or more) goals. Doing this simple task will make your goal setting process easier and more attainable.
Step 3 – Educate, Educate, Educate – Spend some time doing your research on financial topics. Read magazines and books on finance related subjects such as investing. Surf the Internet's for investment web sites and don’t be afraid to learn about the stock market.
Step 4 – Periodically check your progress through a self-evaluation. You’ll want to check your progress monthly, quarterly, or at any other interval you feel comfortable with, but at least semi-annually, in order to confirm that your program is working. If you're not making a satisfactory amount of progress on a particular goal, re-evaluate your approach and make changes as necessary.
Remember there are no hard and fast rules for implementing a financial plan. It is okay to dare to dream about riches, just be realistic about what you can actually do. When you write your goals down for your visualization process you will identify any that seem unobtainable and quickly see the more realistic goals that will lead you to financial success. The important thing is to at least do something as opposed to nothing, and to start NOW.
Timothy Gorman is a successful webmaster and publisher of Best-Free-Insurance-Quotes.com. He provides insurance information and offers discount auto, life and home insurance that you can research in your pajamas on his website.
Other websites operated by Tim
Military-Loans-Online.com – Which provides free money saving loan quotes on all of your loan needs to include home equity loan information.
Tuesday, July 19, 2005
Does Your Life Include a RIPE Plan?—Planning Tips for Retirement, Investing, Protection, and Estate Planning
Does Your Life Include a RIPE Plan?—Planning Tips for Retirement, Investing, Protection, and Estate Planning – Part 2 (Investing)
Does Your Life Include a RIPE Plan?—Planning Tips
for Retirement, Investing, Protection, and Estate
Planning – Part 2 (Investing)
by: Janet L. Hall
After reviewing your retirement plan, or lack of one, you might have had a huge eye opener to the type of life you might have to endure after retirement. Did it become apparent that you HAVE to change your lifestyle NOW so you can enjoy your future? Did it become apparent that you better start learning about investing and start investing NOW?
TIP: Before you begin to invest you should also educate yourself into the vast arena of investing. You should have a game plan, know what your expectations are for investing, and your needs for now and the future.
The Internet has made it easier then every to start investing; at least you can sit in the privacy of your home or office and click away your money. BUT are you investing wisely? OR does the whole idea of investing have you so confused or scared that you don’t even think about it?
Let me tell you right up front, there are no PERFECT investments. Very few people (if any) get rich overnight by investing. Investing is more like a long-term savings plan, but hopefully with much better returns.
To make intelligent and wise investments, you should know and understand the economic conditions; not only of the US or country you live in, BUT the world economy as a whole. Stop, learn, and understand how inflation, interest rates, and taxes will affect your investments.
Once you have some understanding of economics and how it will affect your investments then you need to know and understand the different types of investment opportunities that are available and how your age and possibly even your health plays into those investments.
The 5 W’s of Investing:
~~ WHO do I use as my broker or do I go at it alone?
You can do most of your investing yourself but if you need or want advice, hire a planner or broker; you DO NOT have to be rich to hire a planner. Just remember, bottom line, it’s your money, not theirs, and it’s your life!
~~ WHAT type of investments should I make?
A lot of things come into play here – your age, income, available monies, your health, and your expectations. I’ve listed several types of investments for you. It’s your job to find out which is best suited for you.
Types of Investments:
For a small amount of money you can invest in many stocks by investing in MUTUAL FUNDS.
Under Mutual Funds you have:
Growth Funds, Income Funds, Bond Funds, Money Market Funds, Sector Funds, International Funds.
There are * open-ended * and * closed-ended * funds, * fund families *, and * big * funds and * small * funds (Isn’t this FUN!).
INDIVIDUAL STOCKS are publicly traded stocks that are over-the-counter and listed.
Under Stocks you have:
Common Stock, Preferred Stock, Cumulative Preferred, Stock Dividends, and Penny Stock.
IOU a BOND, which is what a bond is.
Under Bonds you have:
T-Bonds, T-Bills, Savings Bonds, Municipal Bonds, Corporate Bonds, and Stripped Bonds.
You can also invest in Real Estate, Art, Collectibles, Utilities, and Commodities.
There are Low Risk/Low Effort and High Effort, Medium Risk/Low Effort and High Effort, and High Risk/Low Effort and High Effort
~~ WHEN do I start investing?
If you’ve been doing your homework the last couple of months in OverHall IT! You should have a working budget in place, cut out needless or wasteful spending, and your financial area should be more in balance. The next suggested step before you begin investing is to build an emergency fund of three to six months’ salary. After all these tasks are completed, then and ONLY then should you think about investing.
TIP: You should only invest money that you can afford to * put away * for at least five years or longer. This means you must take a very close look at other things in your life, such as is your job secure, is your transportation reliable, are you in good health, is your business profitable and steady, and many, many other areas and things in your life before you start investing your hard earned money, because you want to make a profit, right?
~~ WHERE do I invest?
Only you can answer this AFTER you’ve done your homework!
~~ WHY do I want or need to invest?
Do you want to build an estate to leave to your loved ones or do you need extra money now? Are you investing to supplement your income or for your child’s future?
~~ HOW do I invest?
Invest the time in learning about investing your money, it’s your MONEY and your FUTURE. If you’ve already started investing, schedule a meeting with yourself or planner/broker and review your portfolio to make certain your investments are or will be meeting your needs. Make it a habit to review your portfolio at least yearly and especially when you have a * life * change.
As you can see, there is a lot more to investing then just * picking something * and laying out your hard earned cash!
How much time are you willing to invest in your investments?
The mantra for Investing is * Educate, Select, Monitor, and Review *!
TIP: Try playing * pretend investing * while you are learning. E-TRADE offers a * PLAY * area to do such a thing at http://www.etrade.virtualstockexchange.com
Here’s hoping you invest wisely and make the monies that you need or want!
Smiles, not Piles,
The Organizing Wizard, Janet L. Hall, is a Professional
Organizer, Speaker, and Author. She is the owner of
OverHall Consulting, and Organizing By Phone. Subscribe to
her FREE organizing newsletter at
http://www.overhall.com/newsletter.htm or visit
her web site at http://www.overhall.com
Copyright 2000 by OverHall Consulting
P.O. Box 263, Port Republic, MD 20676
All Rights Reserved. Permission is granted to reproduce, copy, or distribute so long as article is kept intact, this copyright notice and full information about contacting the author is attached.
About the Author
The Organizing Wizard, Janet L. Hall, is a Professional
Organizer, Speaker, and Author. She is the owner of
OverHall Consulting, and Organizing By Phone. Subscribe to
her FREE organizing newsletter at
http://www.overhall.com/newsletter.htm
Does Your Life Include a RIPE Plan?—Planning Tips
for Retirement, Investing, Protection, and Estate
Planning – Part 2 (Investing)
by: Janet L. Hall
After reviewing your retirement plan, or lack of one, you might have had a huge eye opener to the type of life you might have to endure after retirement. Did it become apparent that you HAVE to change your lifestyle NOW so you can enjoy your future? Did it become apparent that you better start learning about investing and start investing NOW?
TIP: Before you begin to invest you should also educate yourself into the vast arena of investing. You should have a game plan, know what your expectations are for investing, and your needs for now and the future.
The Internet has made it easier then every to start investing; at least you can sit in the privacy of your home or office and click away your money. BUT are you investing wisely? OR does the whole idea of investing have you so confused or scared that you don’t even think about it?
Let me tell you right up front, there are no PERFECT investments. Very few people (if any) get rich overnight by investing. Investing is more like a long-term savings plan, but hopefully with much better returns.
To make intelligent and wise investments, you should know and understand the economic conditions; not only of the US or country you live in, BUT the world economy as a whole. Stop, learn, and understand how inflation, interest rates, and taxes will affect your investments.
Once you have some understanding of economics and how it will affect your investments then you need to know and understand the different types of investment opportunities that are available and how your age and possibly even your health plays into those investments.
The 5 W’s of Investing:
~~ WHO do I use as my broker or do I go at it alone?
You can do most of your investing yourself but if you need or want advice, hire a planner or broker; you DO NOT have to be rich to hire a planner. Just remember, bottom line, it’s your money, not theirs, and it’s your life!
~~ WHAT type of investments should I make?
A lot of things come into play here – your age, income, available monies, your health, and your expectations. I’ve listed several types of investments for you. It’s your job to find out which is best suited for you.
Types of Investments:
For a small amount of money you can invest in many stocks by investing in MUTUAL FUNDS.
Under Mutual Funds you have:
Growth Funds, Income Funds, Bond Funds, Money Market Funds, Sector Funds, International Funds.
There are * open-ended * and * closed-ended * funds, * fund families *, and * big * funds and * small * funds (Isn’t this FUN!).
INDIVIDUAL STOCKS are publicly traded stocks that are over-the-counter and listed.
Under Stocks you have:
Common Stock, Preferred Stock, Cumulative Preferred, Stock Dividends, and Penny Stock.
IOU a BOND, which is what a bond is.
Under Bonds you have:
T-Bonds, T-Bills, Savings Bonds, Municipal Bonds, Corporate Bonds, and Stripped Bonds.
You can also invest in Real Estate, Art, Collectibles, Utilities, and Commodities.
There are Low Risk/Low Effort and High Effort, Medium Risk/Low Effort and High Effort, and High Risk/Low Effort and High Effort
~~ WHEN do I start investing?
If you’ve been doing your homework the last couple of months in OverHall IT! You should have a working budget in place, cut out needless or wasteful spending, and your financial area should be more in balance. The next suggested step before you begin investing is to build an emergency fund of three to six months’ salary. After all these tasks are completed, then and ONLY then should you think about investing.
TIP: You should only invest money that you can afford to * put away * for at least five years or longer. This means you must take a very close look at other things in your life, such as is your job secure, is your transportation reliable, are you in good health, is your business profitable and steady, and many, many other areas and things in your life before you start investing your hard earned money, because you want to make a profit, right?
~~ WHERE do I invest?
Only you can answer this AFTER you’ve done your homework!
~~ WHY do I want or need to invest?
Do you want to build an estate to leave to your loved ones or do you need extra money now? Are you investing to supplement your income or for your child’s future?
~~ HOW do I invest?
Invest the time in learning about investing your money, it’s your MONEY and your FUTURE. If you’ve already started investing, schedule a meeting with yourself or planner/broker and review your portfolio to make certain your investments are or will be meeting your needs. Make it a habit to review your portfolio at least yearly and especially when you have a * life * change.
As you can see, there is a lot more to investing then just * picking something * and laying out your hard earned cash!
How much time are you willing to invest in your investments?
The mantra for Investing is * Educate, Select, Monitor, and Review *!
TIP: Try playing * pretend investing * while you are learning. E-TRADE offers a * PLAY * area to do such a thing at http://www.etrade.virtualstockexchange.com
Here’s hoping you invest wisely and make the monies that you need or want!
Smiles, not Piles,
The Organizing Wizard, Janet L. Hall, is a Professional
Organizer, Speaker, and Author. She is the owner of
OverHall Consulting, and Organizing By Phone. Subscribe to
her FREE organizing newsletter at
http://www.overhall.com/newsletter.htm or visit
her web site at http://www.overhall.com
Copyright 2000 by OverHall Consulting
P.O. Box 263, Port Republic, MD 20676
All Rights Reserved. Permission is granted to reproduce, copy, or distribute so long as article is kept intact, this copyright notice and full information about contacting the author is attached.
About the Author
The Organizing Wizard, Janet L. Hall, is a Professional
Organizer, Speaker, and Author. She is the owner of
OverHall Consulting, and Organizing By Phone. Subscribe to
her FREE organizing newsletter at
http://www.overhall.com/newsletter.htm
Monday, July 18, 2005
How Can I Make Money Currency Trading?
How Can I Make Money Currency Trading?
Basically you can make money from trading money. If you have US dollars you can buy British pounds for a set rate and they trade the money back in the future at a different rate. This can make your gains immense. Much larger than gains made on the stock market. Just as the upside for currency trading is high, the downside is just as scary and can be immense also. There are currency trading brokers available on line that can provide strategies to limit your losses and maximise your gains.
If you are new to investing online, don't put your entire life savings into an online account. Start with a smaller sum, which will be easier to handle and keep track of. Once you feel confident, you can then decide to add more money to your investing online account.
Once online, many investors tend to concentrate on stocks, specifically large-cap domestic stocks. While these stocks should make up part of your portfolio, they shouldn't be ALL of it! Take into account your time horizon and risk tolerance to develop a well-balanced portfolio of stocks, bonds, and cash.
If you're new to investing online and are looking to open a brokerage account, there are some important facts you should know before choosing a broker. Each one has strengths and weaknesses, but not everyone sees a broker in the same way. For example, if you're comfortable finding your own research for investing online, then the deep discount brokers will work well for you.
Ask yourself…
What services are offered? Do they have research available? What is the cost to you for investing online? What are the real commission costs to do a trade, including any handling fees? How are confirmations sent to you -- by e-mail, by snail mail, by phone? Can you enter orders by phone, by e-mail, directly on-line? Does it cost extra to call and talk to a broker for help with your account?
In a low interest rate environment like the US, it can be a problem to invest in secure high-yielding fixed income investments. Most of these investments are around the base rate as set by the government. It would be difficult to get secure investments around the 3% mark. In New Zealand or Australia some fixed interest investments are worth 7.5% or 8%. An issue with making an investment abroad is that currency rates are so volatile that even though you make 5% on yield, that gain can be wiped out in currency rates.
Equally, currency rates can work in your favour and your investment will have an extremely high yield. To eliminate this uncertainty you can make a foreign investment today using a spot trade and also set up a forward trade at the time of investment maturity. This way you eliminate currency risk in your investment and can capitalise on foreign products. Setting up a forward trade costs money but in many instances the cost of the trade is minimal in comparison to the gains that can be made.
About The Author
Matt Clarkson is a specialist in both traditional and online business that has years of experience in borrowing money and investing for capital growth.
The Free Information Online website is designed to help people find unbiased advice and tips with out the worry of any high pressure selling.
For more free and unbiased advice go to… http://www.freeinformationonline.com
Basically you can make money from trading money. If you have US dollars you can buy British pounds for a set rate and they trade the money back in the future at a different rate. This can make your gains immense. Much larger than gains made on the stock market. Just as the upside for currency trading is high, the downside is just as scary and can be immense also. There are currency trading brokers available on line that can provide strategies to limit your losses and maximise your gains.
If you are new to investing online, don't put your entire life savings into an online account. Start with a smaller sum, which will be easier to handle and keep track of. Once you feel confident, you can then decide to add more money to your investing online account.
Once online, many investors tend to concentrate on stocks, specifically large-cap domestic stocks. While these stocks should make up part of your portfolio, they shouldn't be ALL of it! Take into account your time horizon and risk tolerance to develop a well-balanced portfolio of stocks, bonds, and cash.
If you're new to investing online and are looking to open a brokerage account, there are some important facts you should know before choosing a broker. Each one has strengths and weaknesses, but not everyone sees a broker in the same way. For example, if you're comfortable finding your own research for investing online, then the deep discount brokers will work well for you.
Ask yourself…
What services are offered? Do they have research available? What is the cost to you for investing online? What are the real commission costs to do a trade, including any handling fees? How are confirmations sent to you -- by e-mail, by snail mail, by phone? Can you enter orders by phone, by e-mail, directly on-line? Does it cost extra to call and talk to a broker for help with your account?
In a low interest rate environment like the US, it can be a problem to invest in secure high-yielding fixed income investments. Most of these investments are around the base rate as set by the government. It would be difficult to get secure investments around the 3% mark. In New Zealand or Australia some fixed interest investments are worth 7.5% or 8%. An issue with making an investment abroad is that currency rates are so volatile that even though you make 5% on yield, that gain can be wiped out in currency rates.
Equally, currency rates can work in your favour and your investment will have an extremely high yield. To eliminate this uncertainty you can make a foreign investment today using a spot trade and also set up a forward trade at the time of investment maturity. This way you eliminate currency risk in your investment and can capitalise on foreign products. Setting up a forward trade costs money but in many instances the cost of the trade is minimal in comparison to the gains that can be made.
About The Author
Matt Clarkson is a specialist in both traditional and online business that has years of experience in borrowing money and investing for capital growth.
The Free Information Online website is designed to help people find unbiased advice and tips with out the worry of any high pressure selling.
For more free and unbiased advice go to… http://www.freeinformationonline.com
Friday, July 15, 2005
The 5 Secrets to Getting Out of Debt Fast
The 5 Secrets to Getting Out of Debt Fast
As they stare down at a teetering pile of bills, so many consumers wonder how they racked up such a large debt. The answer boils down to simple mathematics.
“On a basic, fundamental level, the problem is created by spending more than you make,” says Brad Stroh, co-CEO of the San Mateo, California-based Freedom Financial Network, LLC, a company that specializes in debt resolution services.
The reasons for doing so, he notes, are varied:
* Spending addictions
* Lack of budgeting (mistaking the amount of money coming in and going out)
* Loss of income (reduced hours, layoffs, forced to leave the workforce)
* Increased costs (health-related expenses, fuel and other basic living expenses)
* A personal hardship (divorce, medical illness, loss of a loved one or other major changes in a person’s life)
You can, however, get out of debt—but it takes commitment. Here are 5 steps to accomplishing your goal.
1. Start Planning—and Saving
“The only way to guarantee solid financial footing is through proper planning—and that’s where most consumers go wrong,” Stroh says. “Proper planning means monthly budgeting of cash flow, combined with saving for long-term security.”
Stroh recommends saving at least 5% of your income to ensure long-term financial security.
“Of course, this percent will vary by age group and the individual’s financial goals and objectives,” he says. “Younger people can expect to spend their early years saving less of their income, paying off student loans and debts incurred during periods of lower income. Older individuals should be planning for retirement and saving a larger share of income.”
2. Seek Professional Help
If you are facing financial hardship, do not procrastinate when it comes to seeking professional advice.
“People often wait too long,” Stroh says. “If someone is living paycheck to paycheck, is behind on any revolving financial obligations (including credit cards), is using credit cards to pay for necessities, or is facing collection, he should consider getting immediate advice from a professional debt management firm or financial advisor.”
3. Stop Spending
If you continue to spend money, despite your ever-growing debt, you likely have a bona fide addiction that requires psychological intervention.
“Debt problems are frequently symptomatic of more fundamental personal issues, such as reticence to address difficult financial problems,” Stroh says. “Spending addictions can have many causes, including lack of personal confidence and fulfillment. Similar to many other addictions, a spending addiction can fill a void in an individual’s life—albeit with a fleeting source of satisfaction. People with spending addictions constantly strive for the ‘high’ that they receive from buying clothes, cars and other goods. This leads to a long-term problem when they cannot meet the consequent financial turmoil that comes when the bills arrive. For anyone who may think he has a serious spending addiction, we advise seeking professional counseling or therapy to resolve the fundamental sources of this addiction.”
4. Start Communicating
If you’re like many consumers with outstanding debts, the last person you think about speaking with is the creditor—the company you’ve been avoiding at all costs.
“Not contacting your debt creditors to discuss and develop a plan for paying, settling or reducing the principal amount and/or interest on the debt” is one of the worst mistakes you can make, says financial expert Ivan Gelfand, president and CEO of Pepper Pike, Ohio-based Ivan Gelfand, Inc., and author of “Your Money, Your Future” (to be published in April).
He also recommends contacting relatives or friends for temporary assistance in reducing debt and making payments, which will lower your outstanding debts’ interest rate.
5. Conquer Denial—Today!
Many consumers who recognize—and even accept the fact—that they have a spending addiction refuse to address their problems, according to Stroh.
“Budgeting is not fun,” he says, “but dealing with creditors is even less fun. Many people will therefore bury their heads in the sand, hoping their problems will go away. Unfortunately, outside of winning the lottery or getting a windfall inheritance from a long-lost uncle, budgeting and consulting with a professional counselor are the only ways to successfully resolve financial problems.”
About The Author
Fox Symes assists all Australians discover the truth about their debts and how they can rapidly reduce them. Visit http://www.foxsymes.com.au or contact them directly on 1300 361 204.
As they stare down at a teetering pile of bills, so many consumers wonder how they racked up such a large debt. The answer boils down to simple mathematics.
“On a basic, fundamental level, the problem is created by spending more than you make,” says Brad Stroh, co-CEO of the San Mateo, California-based Freedom Financial Network, LLC, a company that specializes in debt resolution services.
The reasons for doing so, he notes, are varied:
* Spending addictions
* Lack of budgeting (mistaking the amount of money coming in and going out)
* Loss of income (reduced hours, layoffs, forced to leave the workforce)
* Increased costs (health-related expenses, fuel and other basic living expenses)
* A personal hardship (divorce, medical illness, loss of a loved one or other major changes in a person’s life)
You can, however, get out of debt—but it takes commitment. Here are 5 steps to accomplishing your goal.
1. Start Planning—and Saving
“The only way to guarantee solid financial footing is through proper planning—and that’s where most consumers go wrong,” Stroh says. “Proper planning means monthly budgeting of cash flow, combined with saving for long-term security.”
Stroh recommends saving at least 5% of your income to ensure long-term financial security.
“Of course, this percent will vary by age group and the individual’s financial goals and objectives,” he says. “Younger people can expect to spend their early years saving less of their income, paying off student loans and debts incurred during periods of lower income. Older individuals should be planning for retirement and saving a larger share of income.”
2. Seek Professional Help
If you are facing financial hardship, do not procrastinate when it comes to seeking professional advice.
“People often wait too long,” Stroh says. “If someone is living paycheck to paycheck, is behind on any revolving financial obligations (including credit cards), is using credit cards to pay for necessities, or is facing collection, he should consider getting immediate advice from a professional debt management firm or financial advisor.”
3. Stop Spending
If you continue to spend money, despite your ever-growing debt, you likely have a bona fide addiction that requires psychological intervention.
“Debt problems are frequently symptomatic of more fundamental personal issues, such as reticence to address difficult financial problems,” Stroh says. “Spending addictions can have many causes, including lack of personal confidence and fulfillment. Similar to many other addictions, a spending addiction can fill a void in an individual’s life—albeit with a fleeting source of satisfaction. People with spending addictions constantly strive for the ‘high’ that they receive from buying clothes, cars and other goods. This leads to a long-term problem when they cannot meet the consequent financial turmoil that comes when the bills arrive. For anyone who may think he has a serious spending addiction, we advise seeking professional counseling or therapy to resolve the fundamental sources of this addiction.”
4. Start Communicating
If you’re like many consumers with outstanding debts, the last person you think about speaking with is the creditor—the company you’ve been avoiding at all costs.
“Not contacting your debt creditors to discuss and develop a plan for paying, settling or reducing the principal amount and/or interest on the debt” is one of the worst mistakes you can make, says financial expert Ivan Gelfand, president and CEO of Pepper Pike, Ohio-based Ivan Gelfand, Inc., and author of “Your Money, Your Future” (to be published in April).
He also recommends contacting relatives or friends for temporary assistance in reducing debt and making payments, which will lower your outstanding debts’ interest rate.
5. Conquer Denial—Today!
Many consumers who recognize—and even accept the fact—that they have a spending addiction refuse to address their problems, according to Stroh.
“Budgeting is not fun,” he says, “but dealing with creditors is even less fun. Many people will therefore bury their heads in the sand, hoping their problems will go away. Unfortunately, outside of winning the lottery or getting a windfall inheritance from a long-lost uncle, budgeting and consulting with a professional counselor are the only ways to successfully resolve financial problems.”
About The Author
Fox Symes assists all Australians discover the truth about their debts and how they can rapidly reduce them. Visit http://www.foxsymes.com.au or contact them directly on 1300 361 204.
Thursday, July 14, 2005
Is There Any Way To Get Out Of Debt?
Is There Any Way To Get Out Of Debt?
In this era where we are bombarded daily with commercials on television, radio, billboards, through email, not to forget the flyers slipped under the car's wiper blades while shopping at the mall, it's no surprise that so many of us find ourselves endlessly in debt to the services and products offered by others. How can we refuse, when we're baited with the juicy orange carrot of '0% APR' up to a certain amount or for a specified time, or 'no money down' and 'easy installments' of just so much per month?
Before we know it, we're in debt. We have credit card payments, consumer loan payments, car payments, a home mortgage, and only enough money coming in to pay the minimum amounts each month. Then, we start noticing a different set of ads being directed at us from every marketing angle imaginable. Get a home equity loan and pay off your credit cards, some suggest. Start your own home business using our 'unique, proven' system, and all your financial problems will be gone before you know it. But, are these really the solutions that most of us so desperately need?
Far too many of us are as quickly bought by these financial rescue ads as we were bought by the ads that inspired us down the road to financial trouble. And, when we've tried more than one and found ourselves still dealing with monthly minimum payments or even possibly just finding ourselves deeper in debt for having tried so many systems, we end up asking ourselves what were doing wrong. Some who are financially struggling do take the route of taking a loan to pay off the loans already made with others, and get the instant gratification of available credit all over again. Or building a home business that does generate a positive return of some sort, giving them more financial freedom to spend freely on themselves and their loved ones. But, by doing this, are we really resolving the problem? And, what about those that don't have or want these options - regardless how many happy testimonials from clients are shared?
Not everyone owns a home or, for the ones that do, may be leery about the idea of taking out a massive loan to pay off many smaller loans. Not everyone wants to start a home based business, they just want the freedom that comes with not having a lot of debt every month. And, most importantly, the quick fix solutions to life's financial troubles doesn't give any insight into how we got ourselves into this financial situation in the first place, and how to avoid it now that we have the spending capital that comes with available credit again. So, for the many of us who are seeking a genuine solution to our financial woes, what is the answer we're looking for?
The answer may be a lot closer than we think. It first starts with developing awareness of where our paychecks are going and to whom. Yes, the ol' balance sheet thing, where we keep a detailed log of our spending activities. And, where we determine by simple addition just how much we presently owe to those who have loaned us money for life pleasures and necessities. Now that we know where we actually are, we can now determine just where we want to be. But, just doing this doesn't solve the problem. Rather, we've managed to illuminate it, so what do we do from here?
For starters, get the financial knowledge that we so desperately need to stop the growing cycle of debt building, and start eliminating the troublesome debts that consume our paychecks month after month. Fortunately, this knowledge is not that hard for us to find, if we know where to look. There are non-profit organizations advertising on television and radio that are devoted to helping people consolidate there debts, and this is a start. Other sources require a purchase of there educational media or encourage membership in their organization for a nominal fee, and the information provided can be more than worth the small investments if the teachings are taken seriously and applied to one's real life budget.
Maybe the solution is literally as simple as the way one teacher on the subject puts it: "If you don't want to make the hole that you've dug for yourself any bigger, then stop digging!" Sure, this may mean having to do without some of the latest technological gadgets, or having to discipline yourself into putting a small amount of the monthly paycheck into a savings account. But, any step that will allow us to keep more of the money we've worked so hard for is a step in the right direction. Then, comes the focus on eliminating the burdensome debts that are already weighing us down. And, it may take awhile. But, isn't the freedom to do what we want with our money worth the effort and time?
After freeing ourselves from the obligations to creditors and banks, the money once spent on debts needs to go somewhere. Maybe it's now time to consider investing this money into stocks or real estate or, possibly, even a business that in time will generate a positive return on our money. This, too, will require some education into the what and how of making wise investments. But, the information is as readily at hand for those who are ready as the solutions to relieving debt.
Then, comes the need to assure ourselves that we won't fall back into the monthly drag of giving away our money to the advertisers that so diligently entice our attention. Resisting the urge to buy into costly items is one way of dealing with this. But, in a land of prosperity such as ours, is it really necessary to live frugally? There may be yet another way. How about buying the assets that will generate an income that we can then spend on these desired possessions?
Not necessarily a novel or new concept, but.... How many of us struggling monthly with debts ever considered the possibility that we really have the opportunity to reach this point? Regardless our present status in life, what can we really achieve with just a little awareness, thoughtful planning, and the knowledge of what to do and when to do it? For those who are seriously looking, there is a way out of debt. And, though each person's situation may be slightly different, the steps that are outline above have been used and proven to be effective by countless individuals who live financially happy lives. Just check out their ads!
About the Author
Joseph T Farkasdi is the President of JtseF, Inc. and is a member of the Financial Freedom Society. He is an entrepreneur who is committed to helping others achieve the financial lifestyle they desire. For more information on eliminating debt, visit http://www.jtsef.com/financial.htm .
GettingOutOfDebt@jtsef.com
In this era where we are bombarded daily with commercials on television, radio, billboards, through email, not to forget the flyers slipped under the car's wiper blades while shopping at the mall, it's no surprise that so many of us find ourselves endlessly in debt to the services and products offered by others. How can we refuse, when we're baited with the juicy orange carrot of '0% APR' up to a certain amount or for a specified time, or 'no money down' and 'easy installments' of just so much per month?
Before we know it, we're in debt. We have credit card payments, consumer loan payments, car payments, a home mortgage, and only enough money coming in to pay the minimum amounts each month. Then, we start noticing a different set of ads being directed at us from every marketing angle imaginable. Get a home equity loan and pay off your credit cards, some suggest. Start your own home business using our 'unique, proven' system, and all your financial problems will be gone before you know it. But, are these really the solutions that most of us so desperately need?
Far too many of us are as quickly bought by these financial rescue ads as we were bought by the ads that inspired us down the road to financial trouble. And, when we've tried more than one and found ourselves still dealing with monthly minimum payments or even possibly just finding ourselves deeper in debt for having tried so many systems, we end up asking ourselves what were doing wrong. Some who are financially struggling do take the route of taking a loan to pay off the loans already made with others, and get the instant gratification of available credit all over again. Or building a home business that does generate a positive return of some sort, giving them more financial freedom to spend freely on themselves and their loved ones. But, by doing this, are we really resolving the problem? And, what about those that don't have or want these options - regardless how many happy testimonials from clients are shared?
Not everyone owns a home or, for the ones that do, may be leery about the idea of taking out a massive loan to pay off many smaller loans. Not everyone wants to start a home based business, they just want the freedom that comes with not having a lot of debt every month. And, most importantly, the quick fix solutions to life's financial troubles doesn't give any insight into how we got ourselves into this financial situation in the first place, and how to avoid it now that we have the spending capital that comes with available credit again. So, for the many of us who are seeking a genuine solution to our financial woes, what is the answer we're looking for?
The answer may be a lot closer than we think. It first starts with developing awareness of where our paychecks are going and to whom. Yes, the ol' balance sheet thing, where we keep a detailed log of our spending activities. And, where we determine by simple addition just how much we presently owe to those who have loaned us money for life pleasures and necessities. Now that we know where we actually are, we can now determine just where we want to be. But, just doing this doesn't solve the problem. Rather, we've managed to illuminate it, so what do we do from here?
For starters, get the financial knowledge that we so desperately need to stop the growing cycle of debt building, and start eliminating the troublesome debts that consume our paychecks month after month. Fortunately, this knowledge is not that hard for us to find, if we know where to look. There are non-profit organizations advertising on television and radio that are devoted to helping people consolidate there debts, and this is a start. Other sources require a purchase of there educational media or encourage membership in their organization for a nominal fee, and the information provided can be more than worth the small investments if the teachings are taken seriously and applied to one's real life budget.
Maybe the solution is literally as simple as the way one teacher on the subject puts it: "If you don't want to make the hole that you've dug for yourself any bigger, then stop digging!" Sure, this may mean having to do without some of the latest technological gadgets, or having to discipline yourself into putting a small amount of the monthly paycheck into a savings account. But, any step that will allow us to keep more of the money we've worked so hard for is a step in the right direction. Then, comes the focus on eliminating the burdensome debts that are already weighing us down. And, it may take awhile. But, isn't the freedom to do what we want with our money worth the effort and time?
After freeing ourselves from the obligations to creditors and banks, the money once spent on debts needs to go somewhere. Maybe it's now time to consider investing this money into stocks or real estate or, possibly, even a business that in time will generate a positive return on our money. This, too, will require some education into the what and how of making wise investments. But, the information is as readily at hand for those who are ready as the solutions to relieving debt.
Then, comes the need to assure ourselves that we won't fall back into the monthly drag of giving away our money to the advertisers that so diligently entice our attention. Resisting the urge to buy into costly items is one way of dealing with this. But, in a land of prosperity such as ours, is it really necessary to live frugally? There may be yet another way. How about buying the assets that will generate an income that we can then spend on these desired possessions?
Not necessarily a novel or new concept, but.... How many of us struggling monthly with debts ever considered the possibility that we really have the opportunity to reach this point? Regardless our present status in life, what can we really achieve with just a little awareness, thoughtful planning, and the knowledge of what to do and when to do it? For those who are seriously looking, there is a way out of debt. And, though each person's situation may be slightly different, the steps that are outline above have been used and proven to be effective by countless individuals who live financially happy lives. Just check out their ads!
About the Author
Joseph T Farkasdi is the President of JtseF, Inc. and is a member of the Financial Freedom Society. He is an entrepreneur who is committed to helping others achieve the financial lifestyle they desire. For more information on eliminating debt, visit http://www.jtsef.com/financial.htm .
GettingOutOfDebt@jtsef.com
Tuesday, July 12, 2005
How To Get Online Press Releases On Your Stocks Before Others Hear About Them
How To Get Online Press Releases On Your Stocks Before Others Hear About Them
by: Bill Peifer
It is a fact of life that press releases influence the current price of a stock. People react emotionally and buy stocks on good press releases, and sell stocks on bad ones, regardless of the validity of the press release. If you can get the news first, you can be in a favorable position to take advantage and gain financially. This article describes how to obtain online stock press releases when they are first announced.
One way to be the first to obtain online press releases on stocks would be to constantly watch one or more of the financial News web pages for a press release via Business Wire. Yahoo provides a popular and reliable financial news web page (http://biz.yahoo.com/bw). But manually watching web pages requires your full time attention. Unless you are some rich tycoon who sits by a Palm Springs swimming pool reading the financial news web pages as they update, this is probably not going to work for you. Like most people you probably have other things to do, such as working for a living.
A better way to accomplish the task of monitoring the financial news web pages would be to have someone or something else do it for you, and then notify you. For instance, you can use web page watching software on your computer or you can subscribe to a web page watching service on the Internet.
Running software on your computer to monitor a financial news web page, such as Yahoo's, is easy to do and gives you complete control over when and what you want to watch for. It can also give you faster notification on press release discoveries. There are many programs available on the web to do this. Easy Web Page Watcher by Patrick DiRienzo (http://www.patdirienzo.com) is an easy-to-use low cost program ($15) that does a very good job of monitoring Yahoo and other financial news web pages. To use the program simply enter the financial news web pages that you wish to monitor and the name of your stocks. When the name of your stock appears on the web page in a press release, your computer when notify you with an audible alarm and by email. You can also watch for keyword phrases such as "contract awarded" or "stock buyback" that would appear in any stock press release. If you have full time broadband Internet access such as cable or DSL you can leave the program running all day and night. The program runs in the background with no disturbance to your other computer tasks. You can set up the program to send you email alerts at work or anywhere else.
If you do not have full time Internet access, but have email, the next best method of obtaining press releases automatically is to subscribe to a web page watching service. Again there are many services that do this. WatchThatPage (http://www.watchthatpage.com) is a free web page watching service that will alert you by email when keywords you specify such as the names of your stocks appear in press releases on financial news pages you specify. The disadvantage is that you do not receive an instant audible alarm when the press release is first noticed on the financial news web page. You have to wait for the service to send you email before you hear about the press release.
Info on Author
Bill Peifer holds a degree in Electrical/Computer Engineering and has written several computer technology related articles.
bpeifer@numericnetwork.com
by: Bill Peifer
It is a fact of life that press releases influence the current price of a stock. People react emotionally and buy stocks on good press releases, and sell stocks on bad ones, regardless of the validity of the press release. If you can get the news first, you can be in a favorable position to take advantage and gain financially. This article describes how to obtain online stock press releases when they are first announced.
One way to be the first to obtain online press releases on stocks would be to constantly watch one or more of the financial News web pages for a press release via Business Wire. Yahoo provides a popular and reliable financial news web page (http://biz.yahoo.com/bw). But manually watching web pages requires your full time attention. Unless you are some rich tycoon who sits by a Palm Springs swimming pool reading the financial news web pages as they update, this is probably not going to work for you. Like most people you probably have other things to do, such as working for a living.
A better way to accomplish the task of monitoring the financial news web pages would be to have someone or something else do it for you, and then notify you. For instance, you can use web page watching software on your computer or you can subscribe to a web page watching service on the Internet.
Running software on your computer to monitor a financial news web page, such as Yahoo's, is easy to do and gives you complete control over when and what you want to watch for. It can also give you faster notification on press release discoveries. There are many programs available on the web to do this. Easy Web Page Watcher by Patrick DiRienzo (http://www.patdirienzo.com) is an easy-to-use low cost program ($15) that does a very good job of monitoring Yahoo and other financial news web pages. To use the program simply enter the financial news web pages that you wish to monitor and the name of your stocks. When the name of your stock appears on the web page in a press release, your computer when notify you with an audible alarm and by email. You can also watch for keyword phrases such as "contract awarded" or "stock buyback" that would appear in any stock press release. If you have full time broadband Internet access such as cable or DSL you can leave the program running all day and night. The program runs in the background with no disturbance to your other computer tasks. You can set up the program to send you email alerts at work or anywhere else.
If you do not have full time Internet access, but have email, the next best method of obtaining press releases automatically is to subscribe to a web page watching service. Again there are many services that do this. WatchThatPage (http://www.watchthatpage.com) is a free web page watching service that will alert you by email when keywords you specify such as the names of your stocks appear in press releases on financial news pages you specify. The disadvantage is that you do not receive an instant audible alarm when the press release is first noticed on the financial news web page. You have to wait for the service to send you email before you hear about the press release.
Info on Author
Bill Peifer holds a degree in Electrical/Computer Engineering and has written several computer technology related articles.
bpeifer@numericnetwork.com
Saturday, July 09, 2005
money market account
Is Your Money Keeping Up With Inflation, money market account?
In today's unpredictable global economy and money market account, you obviously never know what is going to happen next. Uncertainties and concerns regarding the Iraqi threat, North Korean crisis, and hidden terrorist cells and networks continue to loom in the back of the minds of consumers. Moreover, the stock markets, money market account, and industries around the world.
Price inflation is another major concern for everyone. The latest Consumer Price Index (CPI) number released by the U.S. Department of Labor's Bureau of Labor Statistics states that prices, in all U.S. cities, are up 0.1% in the month of December for the calendar year of 2002. The Consumer Price Index (CPI) is a program that produces monthly data on changes in the prices paid by urban consumers for a representative basket of goods and services. Furthermore, the national unemployment rate continues to remain steady at 6.0% for the month of December 2002. Believe it or not, this may not be as bad as it sounds.
Economic theory suggests that an increase in the inflation rate will lead to a decrease in the national unemployment rate. But since the unemployment rate is currently 6.0%, this may also suggest that in order for this rate to eventually decrease, we should expect more inflation in the future. The recent upsurge in oil prices together with precious metals supports this theory and may also be a hint of what's to come.
Well, it seems that you probably can't avoid inflation, but there are definitely opportunities that you can take advantage of, in order to keep up with it. One option might be to consider depositing your money into a savings account rather than a money market account. Most major banks are currently yielding an Annual Percentage Yield (APY) that ranges from 0.5% to 0.75%. Even though this is pretty low, it is higher than what most money market account are currently offering.
One of the best rates that I have recently seen is ING Direct's offering of 2.25% APY for their Orange Savings Account. But if these rates are not what you are looking for, consider investing in the stock market. With the latest downturn in the economy, shares are pretty cheap and going fast. There are now many online brokerages that allow consumers to purchase stocks for a small fee. For instance, Sharebuilder lets consumers invest for as little as $4. However, please be wary, this investment option is a greater risk so you should consult with a financial advisor before taking this step.
Whether you choose to put your money in these investment opportunities or not, it is up to you. But just remember that if you don't, you are actually losing money because the "purchasing power" of your dollar is decreasing as the inflation rate is increasing.
About the Author
Carlos T. Fernandez is the business columnist for Dominican Times Magazine, a publication that focuses on the hispanic culture and the issues affecting its communities. He is also the publisher of a popular financial planning and management website entitled Building Wealth (http://buildingwealth.blogspot.com).
In today's unpredictable global economy and money market account, you obviously never know what is going to happen next. Uncertainties and concerns regarding the Iraqi threat, North Korean crisis, and hidden terrorist cells and networks continue to loom in the back of the minds of consumers. Moreover, the stock markets, money market account, and industries around the world.
Price inflation is another major concern for everyone. The latest Consumer Price Index (CPI) number released by the U.S. Department of Labor's Bureau of Labor Statistics states that prices, in all U.S. cities, are up 0.1% in the month of December for the calendar year of 2002. The Consumer Price Index (CPI) is a program that produces monthly data on changes in the prices paid by urban consumers for a representative basket of goods and services. Furthermore, the national unemployment rate continues to remain steady at 6.0% for the month of December 2002. Believe it or not, this may not be as bad as it sounds.
Economic theory suggests that an increase in the inflation rate will lead to a decrease in the national unemployment rate. But since the unemployment rate is currently 6.0%, this may also suggest that in order for this rate to eventually decrease, we should expect more inflation in the future. The recent upsurge in oil prices together with precious metals supports this theory and may also be a hint of what's to come.
Well, it seems that you probably can't avoid inflation, but there are definitely opportunities that you can take advantage of, in order to keep up with it. One option might be to consider depositing your money into a savings account rather than a money market account. Most major banks are currently yielding an Annual Percentage Yield (APY) that ranges from 0.5% to 0.75%. Even though this is pretty low, it is higher than what most money market account are currently offering.
One of the best rates that I have recently seen is ING Direct's offering of 2.25% APY for their Orange Savings Account. But if these rates are not what you are looking for, consider investing in the stock market. With the latest downturn in the economy, shares are pretty cheap and going fast. There are now many online brokerages that allow consumers to purchase stocks for a small fee. For instance, Sharebuilder lets consumers invest for as little as $4. However, please be wary, this investment option is a greater risk so you should consult with a financial advisor before taking this step.
Whether you choose to put your money in these investment opportunities or not, it is up to you. But just remember that if you don't, you are actually losing money because the "purchasing power" of your dollar is decreasing as the inflation rate is increasing.
About the Author
Carlos T. Fernandez is the business columnist for Dominican Times Magazine, a publication that focuses on the hispanic culture and the issues affecting its communities. He is also the publisher of a popular financial planning and management website entitled Building Wealth (http://buildingwealth.blogspot.com).
Wednesday, July 06, 2005
ForexInterBank Forex Trading Course for Day Traders and Small Investors Focusing on Forex Pivot Point Trading
More and more day traders and small investors are turning to the foreign currency exchange market and for a number of good reasons. "The spot forex market provides them the means to invest without concern for liquidity or market manipulation," says John Keister, ForexInterBank’s CEO. "More importantly, forex pivot point trading provides conservative investors the means to turn a modest but consistent profit."
"Historically, the investment opportunities afforded by forex trading have gone largely unrealized because, up until a few years ago, the market had been the exclusive domain of governments, banks, institutional investors, and brokerage houses. Now, through ForexInterBank, investors can learn how to take advantage of those opportunities using a forex trading course designed to simplify the process and to accelerate the learning curve," say Keister, a medical doctor who first started trading forex while he was in medical school.
According to Keister, forex trading, while well known in the ‘inner circle’, is only now beginning to get the attention of both day traders and private investors. "Ten years ago, it was difficult to find a day trader or private investor who was familiar with the market. Now at least half of the people I talk with are at least mildly familiar with the market and half of those have actually dabbled in it," he says.
Keister attributes this increased interest level to a number of problems unique to equities and futures trading. "The biggest problem is that price fluctuations on the equities and futures markets are all too often a direct result of manipulation and/or the buying and selling habits of major investors. Prices are not driven as much by supply and demand as they are driven by market makers, media hype, and large institutional investors who have the financial means to literally make or break a stock overnight," he says.
The forex spot market, according to Keister, isn’t subject to that kind of manipulation. The average daily turnover in the forex spot market is approximately $1.3 trillion dollars, 30 times the turnover of all equity and futures markets combined. Unlike the equities and futures markets, forex market fluctuations are driven by pure supply and demand - the purchase and sale of foreign goods and services and, of course, speculation.
Experts estimate that 5% of the market’s turnover is actually driven by trade imbalances, the remaining 95% comes from speculation. "One doesn’t have to be an economist to understand that it is virtually impossible for any entity to manipulate a market of such an immense size," Keister says.
"What makes forex even more attractive is that one doesn’t have to waste time spending endless hours doing technical analysis and studying fundamentals that, as I mentioned before, can be totally invalidated by the actions of insiders and major investors," he says. "Forex trades, while certainly not without risk, can be profitably and predictably executed without endless and sometimes fruitless study."
A second drawback to equity and futures markets is that once made investments are not very liquid. "Investors can’t react immediately to fluctuations in the equity and futures markets because those markets are not ‘openly’ traded 24 hours a day. A lot can happen between the closing and opening bells, let alone over a long weekend, and if the investor sleeps late, he may wake up to find upon opening that he has suffered significant losses," he says.
"By contrast, the forex market never closes. Once a trade has been initiated, the investor has the ability to modify the parameters of that trade 24 hours a day."
Perhaps the biggest factor making forex trading attractive is that trades are not commission driven or heavily fee based and this is why Keister got involved in forex pivot point trading in the first place ten years ago. "Like most investors, when I started looking for ways to invest my money, I began the process working with stockbrokers who were more interested in churning my accounts than they were providing me with the information I needed to make ‘my’ cash register ring," he says.
"In search of a way to avoid costly brokerage fees, I looked into traditional day trading but found that the costs were prohibitive. First, one has to invest a great deal of money in an education which can, as I said earlier, be rendered irrelevant by players who can easily manipulate the market. Secondly, one has to ‘pay the piper’. By that I mean you have to buy or lease an extraordinarily expensive and exotic software program that will enable you to execute trades.
"Of course, one can always find ‘free’ software, but the annual software lease agreements and/or membership fees paid to the company offering it end up costing more over the long term than you would have paid had you purchased the software outright," he says.
Disappointed with the vagaries of the equity markets, hidden agendas of brokerage firms, and the sizable start up costs of equities day trading, Keister’s turned to forex. "Forex trading is excruciatingly affordable. One doesn’t have to invest a fortune in software and on-going membership fees to get started. Trading software is readily available on-line and the only fee one can anticipate is a modest transaction spread," Keister says.
"When I first started looking into forex trading, I discovered that the only way small investors could get in the market was to jump in the deep end, more often than not, without the knowledge they needed to keep themselves afloat. Like everyone else, I paid dearly for my lessons because I couldn’t find a mentor willing or able to provide the information I needed to succeed. Now that I look back on the experiences I had, I can understand why that information wasn’t readily available. The big boys were just too busy making money and had nothing to gain sharing their expertise with little guys like me," Keister says.
When Keister first entered the forex market, he was naturally frustrated by the fact that there was no single, reliable source he could rely on to get answers to even the simplest questions," he says. "There were a few insiders who assembled rudimentary training materials they would sell at an exaggerated cost, but I couldn’t find a central source of information about forex trading and, more importantly, couldn’t get clarification when the materials provided generated even more questions than they answered.
"Over the past ten years I’ve also read scores of books about forex trading and they, too, have a common problem. While providing an abundance of information, they unnecessarily complicate the process," he says. "Forex trading is a very simple process based on a mastery of a number of visual cues that normally occur above and below pivot points. You don’t need to understand why the market behaves the way it does. You only need to be able to recognize a few predicable patterns to generate a reasonable and consistent return on your investments."
Failing to find an adequate source of information, Keister decided to put together an education program of his own, one based on his own successes and failures. "It was clear to me that the forex education arena was lacking so I put together a forex trading course that simplifies the process, providing answers to basic questions the experts were too either too busy to answer or couldn’t answer in a language that can be easily understood," he says. In the end he believes he has developed a forex trading course that actually makes forex trading easy - a forex trading course for dummies.
Why would he use the term ‘dummies?’ "Not to 'dis' the younger generation, but I hired a number of high school and college students to test the program and the majority are now successfully trading on their own behalf. Those who are underage are using custodial accounts set up by their parents," he says. "If they can do it with as little knowledge as they have, anyone can do it."
Unlike so many online forex training programs that sell their clients training materials and then disappear, ForexInterBank’s program includes live, daily mentoring. Once students have completed the company’s interactive forex trading course, they have the means to actually watch and listen to ForexInterBank traders as they walk through their own trades. "We believe this follow-on, real world training is what really sets us apart," Keister says.
"Our clients can actually listen in on real time analysis and watch trades as they actually happen," he says. A few examples of these live mentoring sessions can be viewed in the live training room at the company’s web site. "Visitors can see and listen to eight of our past sessions," Keister points out.
Day traders and investors wanting more information about John Keister and ForexInterBank’s educational services are encouraged to visit www.Forexinterbank.com.
About the Author
The author, Ron Scott, is a seasoned internet publicist who provides affordable public relationsservices to local, regional, national and international businesses.
"Historically, the investment opportunities afforded by forex trading have gone largely unrealized because, up until a few years ago, the market had been the exclusive domain of governments, banks, institutional investors, and brokerage houses. Now, through ForexInterBank, investors can learn how to take advantage of those opportunities using a forex trading course designed to simplify the process and to accelerate the learning curve," say Keister, a medical doctor who first started trading forex while he was in medical school.
According to Keister, forex trading, while well known in the ‘inner circle’, is only now beginning to get the attention of both day traders and private investors. "Ten years ago, it was difficult to find a day trader or private investor who was familiar with the market. Now at least half of the people I talk with are at least mildly familiar with the market and half of those have actually dabbled in it," he says.
Keister attributes this increased interest level to a number of problems unique to equities and futures trading. "The biggest problem is that price fluctuations on the equities and futures markets are all too often a direct result of manipulation and/or the buying and selling habits of major investors. Prices are not driven as much by supply and demand as they are driven by market makers, media hype, and large institutional investors who have the financial means to literally make or break a stock overnight," he says.
The forex spot market, according to Keister, isn’t subject to that kind of manipulation. The average daily turnover in the forex spot market is approximately $1.3 trillion dollars, 30 times the turnover of all equity and futures markets combined. Unlike the equities and futures markets, forex market fluctuations are driven by pure supply and demand - the purchase and sale of foreign goods and services and, of course, speculation.
Experts estimate that 5% of the market’s turnover is actually driven by trade imbalances, the remaining 95% comes from speculation. "One doesn’t have to be an economist to understand that it is virtually impossible for any entity to manipulate a market of such an immense size," Keister says.
"What makes forex even more attractive is that one doesn’t have to waste time spending endless hours doing technical analysis and studying fundamentals that, as I mentioned before, can be totally invalidated by the actions of insiders and major investors," he says. "Forex trades, while certainly not without risk, can be profitably and predictably executed without endless and sometimes fruitless study."
A second drawback to equity and futures markets is that once made investments are not very liquid. "Investors can’t react immediately to fluctuations in the equity and futures markets because those markets are not ‘openly’ traded 24 hours a day. A lot can happen between the closing and opening bells, let alone over a long weekend, and if the investor sleeps late, he may wake up to find upon opening that he has suffered significant losses," he says.
"By contrast, the forex market never closes. Once a trade has been initiated, the investor has the ability to modify the parameters of that trade 24 hours a day."
Perhaps the biggest factor making forex trading attractive is that trades are not commission driven or heavily fee based and this is why Keister got involved in forex pivot point trading in the first place ten years ago. "Like most investors, when I started looking for ways to invest my money, I began the process working with stockbrokers who were more interested in churning my accounts than they were providing me with the information I needed to make ‘my’ cash register ring," he says.
"In search of a way to avoid costly brokerage fees, I looked into traditional day trading but found that the costs were prohibitive. First, one has to invest a great deal of money in an education which can, as I said earlier, be rendered irrelevant by players who can easily manipulate the market. Secondly, one has to ‘pay the piper’. By that I mean you have to buy or lease an extraordinarily expensive and exotic software program that will enable you to execute trades.
"Of course, one can always find ‘free’ software, but the annual software lease agreements and/or membership fees paid to the company offering it end up costing more over the long term than you would have paid had you purchased the software outright," he says.
Disappointed with the vagaries of the equity markets, hidden agendas of brokerage firms, and the sizable start up costs of equities day trading, Keister’s turned to forex. "Forex trading is excruciatingly affordable. One doesn’t have to invest a fortune in software and on-going membership fees to get started. Trading software is readily available on-line and the only fee one can anticipate is a modest transaction spread," Keister says.
"When I first started looking into forex trading, I discovered that the only way small investors could get in the market was to jump in the deep end, more often than not, without the knowledge they needed to keep themselves afloat. Like everyone else, I paid dearly for my lessons because I couldn’t find a mentor willing or able to provide the information I needed to succeed. Now that I look back on the experiences I had, I can understand why that information wasn’t readily available. The big boys were just too busy making money and had nothing to gain sharing their expertise with little guys like me," Keister says.
When Keister first entered the forex market, he was naturally frustrated by the fact that there was no single, reliable source he could rely on to get answers to even the simplest questions," he says. "There were a few insiders who assembled rudimentary training materials they would sell at an exaggerated cost, but I couldn’t find a central source of information about forex trading and, more importantly, couldn’t get clarification when the materials provided generated even more questions than they answered.
"Over the past ten years I’ve also read scores of books about forex trading and they, too, have a common problem. While providing an abundance of information, they unnecessarily complicate the process," he says. "Forex trading is a very simple process based on a mastery of a number of visual cues that normally occur above and below pivot points. You don’t need to understand why the market behaves the way it does. You only need to be able to recognize a few predicable patterns to generate a reasonable and consistent return on your investments."
Failing to find an adequate source of information, Keister decided to put together an education program of his own, one based on his own successes and failures. "It was clear to me that the forex education arena was lacking so I put together a forex trading course that simplifies the process, providing answers to basic questions the experts were too either too busy to answer or couldn’t answer in a language that can be easily understood," he says. In the end he believes he has developed a forex trading course that actually makes forex trading easy - a forex trading course for dummies.
Why would he use the term ‘dummies?’ "Not to 'dis' the younger generation, but I hired a number of high school and college students to test the program and the majority are now successfully trading on their own behalf. Those who are underage are using custodial accounts set up by their parents," he says. "If they can do it with as little knowledge as they have, anyone can do it."
Unlike so many online forex training programs that sell their clients training materials and then disappear, ForexInterBank’s program includes live, daily mentoring. Once students have completed the company’s interactive forex trading course, they have the means to actually watch and listen to ForexInterBank traders as they walk through their own trades. "We believe this follow-on, real world training is what really sets us apart," Keister says.
"Our clients can actually listen in on real time analysis and watch trades as they actually happen," he says. A few examples of these live mentoring sessions can be viewed in the live training room at the company’s web site. "Visitors can see and listen to eight of our past sessions," Keister points out.
Day traders and investors wanting more information about John Keister and ForexInterBank’s educational services are encouraged to visit www.Forexinterbank.com.
About the Author
The author, Ron Scott, is a seasoned internet publicist who provides affordable public relationsservices to local, regional, national and international businesses.
Tuesday, July 05, 2005
The Seven Most Traded Currencies in FOREX
Currencies are traded in dollar amounts called “lots”. One
lot is equal to $1,000, which controls $100,000 in currency.
This is what is known as the "margin". You can control $100,000
worth of currency for only 1,000 dollars. This is what is called “High Leverage”.
Currencies are always traded in pairs in the FOREX. The
pairs have a unique notation that expresses what currencies
are being traded. The symbol for a currency pair will always
be in the form ABC/DEF. ABC/DEF is not a real currency pair,
it is an example of a symbol for a currency pair. In this
example ABC is the symbol for one countries currency and DEF
is the symbol for another countries currency.
Here are some of the common symbols used in the Forex:
USD - The US Dollar
EUR - The currency of the European Union "EURO"
GBP - The British Pound
JPN - The Japanese Yen
CHF - The Swiss Franc
AUD - The Australian Dollar
CAD - The Canadian Dollar
There are symbols for other currencies as well, but these
are the most commonly traded ones.
A currency can never be traded by itself. So you can not
ever trade a EUR by itself. You always need to compare one
currency with another currency to make a trade possible.
Some of the common PAIRS are:
EUR/USD Euro / US Dollar
"Euro"
USD/JPY US Dollar / Japanese Yen
"Dollar Yen"
GBP/USD British Pound / US Dollar
"Cable"
USD/CAD US Dollar / Canadian Dollar
"Dollar Canada"
AUD/USD Australian Dollar/US Dollar
"Aussie Dollar"
USD/CHF US Dollar / Swiss Franc
"Swissy"
EUR/JPY Euro / Japanese Yen
"Euro Yen"
The listed currency pairs above look like a fraction. The
numerator (top of the fraction or "left" of the / however
you want to SEE it) is called the base currency. The
denominator (bottom of the fraction or "right" of the
/however you want to SEE it) is called the counter currency.
When you place an order to buy the EUR/USD, for instance,
you are actually buying the EUR and selling the USD. If you
were to sell the pair, you would be selling the EUR and
buying the USD. So if you buy or sell a currency PAIR, you
are buying/selling the base currency. You are always doing
the opposite of what you did with to base currency with the
counter currency.
If this seems confusing then you're in luck. You can always
get by with just thinking of the entire pair as one item.
Then you are just buying or selling that one item. Thinking
like this will still enable you to place trades. You only
need to be aware of the base/counter concept for Fundamental
Analysis issues.
So why is it important to know about the base/counter
currency? The base/counter currency concept illustrates
what is actually taking place in a Forex transaction. Some
of you reading this, know that short-selling was restricted
in the stock market *(Short-selling is where you sell a
stock/currency/option/commodity first and then try to buy it
back at a lower price later). But in the FOREX you are
always buying one currency (base) and selling another
(counter). If you sell the pair you are simply flipping
which one you buy and which one you sell. The transaction is
essentially the same. This allows you to short-sell with no
restrictions.
You want to be able to short-sell with no restrictions so
you can make money when the market drops as well as when it
rises. The problem with traditional stock market trading is
that the market has to go up for you to make money. With
FOREX trading you can make money in all directions.
About the Author
FOREX Trader and Freelance writer.
http://www.1-forex.com
lot is equal to $1,000, which controls $100,000 in currency.
This is what is known as the "margin". You can control $100,000
worth of currency for only 1,000 dollars. This is what is called “High Leverage”.
Currencies are always traded in pairs in the FOREX. The
pairs have a unique notation that expresses what currencies
are being traded. The symbol for a currency pair will always
be in the form ABC/DEF. ABC/DEF is not a real currency pair,
it is an example of a symbol for a currency pair. In this
example ABC is the symbol for one countries currency and DEF
is the symbol for another countries currency.
Here are some of the common symbols used in the Forex:
USD - The US Dollar
EUR - The currency of the European Union "EURO"
GBP - The British Pound
JPN - The Japanese Yen
CHF - The Swiss Franc
AUD - The Australian Dollar
CAD - The Canadian Dollar
There are symbols for other currencies as well, but these
are the most commonly traded ones.
A currency can never be traded by itself. So you can not
ever trade a EUR by itself. You always need to compare one
currency with another currency to make a trade possible.
Some of the common PAIRS are:
EUR/USD Euro / US Dollar
"Euro"
USD/JPY US Dollar / Japanese Yen
"Dollar Yen"
GBP/USD British Pound / US Dollar
"Cable"
USD/CAD US Dollar / Canadian Dollar
"Dollar Canada"
AUD/USD Australian Dollar/US Dollar
"Aussie Dollar"
USD/CHF US Dollar / Swiss Franc
"Swissy"
EUR/JPY Euro / Japanese Yen
"Euro Yen"
The listed currency pairs above look like a fraction. The
numerator (top of the fraction or "left" of the / however
you want to SEE it) is called the base currency. The
denominator (bottom of the fraction or "right" of the
/however you want to SEE it) is called the counter currency.
When you place an order to buy the EUR/USD, for instance,
you are actually buying the EUR and selling the USD. If you
were to sell the pair, you would be selling the EUR and
buying the USD. So if you buy or sell a currency PAIR, you
are buying/selling the base currency. You are always doing
the opposite of what you did with to base currency with the
counter currency.
If this seems confusing then you're in luck. You can always
get by with just thinking of the entire pair as one item.
Then you are just buying or selling that one item. Thinking
like this will still enable you to place trades. You only
need to be aware of the base/counter concept for Fundamental
Analysis issues.
So why is it important to know about the base/counter
currency? The base/counter currency concept illustrates
what is actually taking place in a Forex transaction. Some
of you reading this, know that short-selling was restricted
in the stock market *(Short-selling is where you sell a
stock/currency/option/commodity first and then try to buy it
back at a lower price later). But in the FOREX you are
always buying one currency (base) and selling another
(counter). If you sell the pair you are simply flipping
which one you buy and which one you sell. The transaction is
essentially the same. This allows you to short-sell with no
restrictions.
You want to be able to short-sell with no restrictions so
you can make money when the market drops as well as when it
rises. The problem with traditional stock market trading is
that the market has to go up for you to make money. With
FOREX trading you can make money in all directions.
About the Author
FOREX Trader and Freelance writer.
http://www.1-forex.com
A Short Introduction To FOREX.
FOREX is the world’s largest and most liquid trading market. Many consider FOREX as the best home business you can ever venture in. Even though regular people have had the opportunity to take part in trading foreign currencies for profit (in the same way banks and large corporations do) since 1998, it is just now becoming the cool, hip, new "thing" to talk about at parties, business events, and other social gatherings.
Even though it has been somewhat of a loosely guarded secret, every day more and more investors are turning to the all-electronic world of FOREX trading for income and profit because of its numerous benefits & advantages over traditional trading vehicles, like stocks, bonds and commodities.
But, still, whenever something seems new or is just becoming a part of social conversation, news articles, and water cooler gossip, misconceptions have to be overcome, the mind
has to be open and the slate has to be clear for starting out fresh with the CORRECT information.
So, in this article, it is my attempt to give you some solid, but not over-detailed, information on just what the heck "FX" (FOREX) means, what it is, and why it exists.
As a successful trader said, Trading FOREX is like picking money up off the floor. Not trading FOREX is like leaving it there for someone else to pick up." Others in the industry
have also said, Trading FOREX is like having an ATM machine on your own computer.
Here's an explanation (one I feel you'll appreciate) of what FOREX is and how a bunch of traders, profit from it:
The Foreign Exchange Market, also referred to the "FOREX" or "FX" market, is the spot (cash) market for currency.
But, don't mistake FX as trading the futures market, where you buy a contract to purchase a particular currency at a future price in time.
What FX traders do is much less risky than trading currencies on the futures market, much more profitable, and a lot easier, than trading stocks.
So, you're probably wondering where it's at ... or ... how to access the FX market?
The answer is: FX Trading is not bound to any one trading floor and is not centralized on an exchange, as with the stock and futures markets. The FX market is considered an Over-the-Counter (OTC) or 'Interbank' market, due to the fact that the entire market is run electronically, within a network of banks, continuously over a 24-hour period.
Yes, if that's the first time you've heard about an all-electronic market, I know this may sound somewhat intriguing to you.
Here's what you are actually trading when you participate in the Foreign Exchange (FOREX) market:
Essentially, like the large banks who use the FX market to protect themselves from the fluctuating exchange rate of different currencies, as an investor, what a FX trader is doing is
simultaneously exchanging one countries currency for another. So, in actuality, they're electronically trading a currency-pair and the price that is quoted to us is the exchange rate
between the two currencies.
In other words, simply the quoted price is how many of the one currency is worth 1 of the other currency.
Example:
EUR/USD last trade 1.2850 - One Euro is worth $1.2850 US dollars.The first currency (in this example, the EURO) is referred to as the base currency and the second (/USD) as the counter or quote currency.
The FOREX has a DAILY trading volume of around $1.5 trillion dollars - 30 times larger than the combined volume of all U.S. equity markets. This means that 1,498,574 skilled traders could each take 1 million dollars out of the FOREX market every day and the FOREX would still have more money left than the New York Stock exchange every day!
The FOREX plays a vital role in the world economy and there will always be a tremendous need for the FOREX. International trade increases as technology and communication increases. As long as there is international trade, there will be a FOREX market. The FX market has to exist so a country like Japan can sell products in the United States and be able to receive Japanese Yen in exchange for US Dollar.
There's plenty of money to be made using FOREX for plenty of traders that use the right trading techniques / tactics that will allow them to profit immensely. And, with only 5% of the daily turnover of volume coming from banks, government and large corporations who need to hedge,
the other 95% is for speculation and profit.
http://ovfbooks.forextech.hop.clickbank.net
About the Author
FOREX Trader and Freelance writer.
http://www.1-forex.com
Even though it has been somewhat of a loosely guarded secret, every day more and more investors are turning to the all-electronic world of FOREX trading for income and profit because of its numerous benefits & advantages over traditional trading vehicles, like stocks, bonds and commodities.
But, still, whenever something seems new or is just becoming a part of social conversation, news articles, and water cooler gossip, misconceptions have to be overcome, the mind
has to be open and the slate has to be clear for starting out fresh with the CORRECT information.
So, in this article, it is my attempt to give you some solid, but not over-detailed, information on just what the heck "FX" (FOREX) means, what it is, and why it exists.
As a successful trader said, Trading FOREX is like picking money up off the floor. Not trading FOREX is like leaving it there for someone else to pick up." Others in the industry
have also said, Trading FOREX is like having an ATM machine on your own computer.
Here's an explanation (one I feel you'll appreciate) of what FOREX is and how a bunch of traders, profit from it:
The Foreign Exchange Market, also referred to the "FOREX" or "FX" market, is the spot (cash) market for currency.
But, don't mistake FX as trading the futures market, where you buy a contract to purchase a particular currency at a future price in time.
What FX traders do is much less risky than trading currencies on the futures market, much more profitable, and a lot easier, than trading stocks.
So, you're probably wondering where it's at ... or ... how to access the FX market?
The answer is: FX Trading is not bound to any one trading floor and is not centralized on an exchange, as with the stock and futures markets. The FX market is considered an Over-the-Counter (OTC) or 'Interbank' market, due to the fact that the entire market is run electronically, within a network of banks, continuously over a 24-hour period.
Yes, if that's the first time you've heard about an all-electronic market, I know this may sound somewhat intriguing to you.
Here's what you are actually trading when you participate in the Foreign Exchange (FOREX) market:
Essentially, like the large banks who use the FX market to protect themselves from the fluctuating exchange rate of different currencies, as an investor, what a FX trader is doing is
simultaneously exchanging one countries currency for another. So, in actuality, they're electronically trading a currency-pair and the price that is quoted to us is the exchange rate
between the two currencies.
In other words, simply the quoted price is how many of the one currency is worth 1 of the other currency.
Example:
EUR/USD last trade 1.2850 - One Euro is worth $1.2850 US dollars.The first currency (in this example, the EURO) is referred to as the base currency and the second (/USD) as the counter or quote currency.
The FOREX has a DAILY trading volume of around $1.5 trillion dollars - 30 times larger than the combined volume of all U.S. equity markets. This means that 1,498,574 skilled traders could each take 1 million dollars out of the FOREX market every day and the FOREX would still have more money left than the New York Stock exchange every day!
The FOREX plays a vital role in the world economy and there will always be a tremendous need for the FOREX. International trade increases as technology and communication increases. As long as there is international trade, there will be a FOREX market. The FX market has to exist so a country like Japan can sell products in the United States and be able to receive Japanese Yen in exchange for US Dollar.
There's plenty of money to be made using FOREX for plenty of traders that use the right trading techniques / tactics that will allow them to profit immensely. And, with only 5% of the daily turnover of volume coming from banks, government and large corporations who need to hedge,
the other 95% is for speculation and profit.
http://ovfbooks.forextech.hop.clickbank.net
About the Author
FOREX Trader and Freelance writer.
http://www.1-forex.com
Monday, July 04, 2005
Option Spread Trading
Spread trading is a technique that can be used to profit in bullish, neutral or bearish conditions. It basically functions to limit risk at the cost of limiting profit as well.
Spread trading is defined as opening a position by buying and selling the same type of option (ie. Call or Put) at the same time. For example, if you buy a call option for stock XYZ, and sell another call option for XYZ, you are in fact spread trading.
By buying one option and selling another, you limit your risk, since you know the exact difference in either the expiration date or strike price (or both) between the two options. This difference is known as the spread, hence the name of this spread treading technique.
VERTICAL SPREADS
A Vertical Spread is a spread where the 2 options (the one you bought, and the one you sold) have the same expiration date, but differ only in strike price. For example, if you bought a $60 June Call option and sold a $70 June Call option, you have created a Vertical Spread.
Let's assume we have a stock XYZ that's currently priced at $50. We think the stock will rise. However, we don't think the rise will be substantial, maybe just a movement of $5.
We then initiate a Vertical Spread on this stock. We Buy a $50 Call option, and Sell a $55 Call option. Let's assume that the $50 Call has a premium of $1 (since it's just In-The-Money), and the $55 Call has a premium of $0.25 (since it's $5 Out-Of-The-Money).
So we pay $1 for the $50 Call, and earn $0.25 off the $55 Call, giving us a total cost of $0.75.
Two things can happen. The stock can either rise, as predicted, or drop below the current price. Let's look at the 2 scenarios:
Scenario 1: The price has dropped to $45. We have made a mistake and predicted the wrong price movement. However, since both Calls are Out-Of-The-Money and will expire worthless, we don't have to do anything to Close the Position. Our loss would be the $0.75 we spent on this spread trading exercise.
Scenario 2: The price has risen to $55. The $50 Call is now $5 In-The-Money and has a premium of $6. The $55 Call is now just In-The-Money and has a premium of $1. We can't just wait till expiration date, because we sold a Call that's not covered by stocks we own (ie. a Naked Call). We therefore need to Close our Position before expiration.
So we need to sell the $50 Call which we bought earlier, and buy back the $55 Call that we sold earlier. So we sell the $50 Call for $6, and buy the $55 Call back for $1. This transaction has earned us $5, resulting in a nett gain of $4.25, taking into account the $0.75 we spent earlier.
What happens if the price of the stock jumps to $60 instead?
Here's where the - limited risk / limited profit - expression comes in. At a current price of $60, the $50 Call would be $10 In-The-Money and would have a premium of $11. The $55 Call would be $5 In-The-Money and would have a premium of $6. Closing the position will still give us $5, and still give us a nett gain of $4.25.
Once both Calls are In-The-Money, our profit will always be limited by the difference between the strike prices of the 2 Calls, minus the amount we paid at the start.
As a general rule, once the stock value goes above the lower Call (the $50 Call in this example), we start to earn profit. And when it goes above the higher Call (the $55 Call in this example), we reach our maximum profit.
So why would we want to perform this Spread?
If we had just done a simple Call option, we would have had to spend the $1 required to buy the $50 Call. In this spread trading exercise, we only had to spend $0.75, hence the - limited risk - expression. So you are risking less, but you will also profit less, since any price movement beyond the higher Call will not earn you any more profit. Hence this strategy is suitable for moderately bullish stocks.
HORIZONTAL SPREADS
We now look a Horizontal Spreads. Horizontal Spreads, otherwise known as Time Spreads or Calendar Spreads, are spreads where the strike prices of the 2 options stay the same, but the expiration dates differ.
To recap: Options have a Time Value associated with them. Generally, as time progresses, an option's premium loses value. In addition, the closer you get to expiration date, the faster the value drops.
This spread takes advantage of this premium decay.
Let's look at an example. Let's say we are now in the middle of June. We decide to perform a Horizontal Spread on a stock. For a particular strike price, let's say the August option has a premium of $4, and the September option has a premium of $4.50.
To initiate a Horizontal Spread, we would Sell the nearer option (in this case August), and buy the further option (in this case September). So we earn $4.00 from the sale and spend $4.50 on the purchase, netting us a $0.50 cost.
Let's fast-forward to the middle of August. The August option is fast approaching its expiration date, and the premium has dropped drastically, say down to $1.50. However, the September option still has another month's room, and the premium is still holding steady at $3.00.
At this point, we would close the spread position. We buy back the August option for $1.50, and sell the September option for $3.00. That gives us a profit of $1.50. When we deduct our initial cost of $0.50, we are left with a profit of $1.00.
That is basically how a Horizontal Spread works. The same technique can be used for Puts as well.
For more information on spread trading, visit:
http://www.option-trading-guide.com/spreads.html
About the Author
Steven is the webmaster of http://www.option-trading-guide.com If you would like to learn more about Option Trading or Technical Analysis, do visit for various strategies and resources to help your stock market investments.
Spread trading is defined as opening a position by buying and selling the same type of option (ie. Call or Put) at the same time. For example, if you buy a call option for stock XYZ, and sell another call option for XYZ, you are in fact spread trading.
By buying one option and selling another, you limit your risk, since you know the exact difference in either the expiration date or strike price (or both) between the two options. This difference is known as the spread, hence the name of this spread treading technique.
VERTICAL SPREADS
A Vertical Spread is a spread where the 2 options (the one you bought, and the one you sold) have the same expiration date, but differ only in strike price. For example, if you bought a $60 June Call option and sold a $70 June Call option, you have created a Vertical Spread.
Let's assume we have a stock XYZ that's currently priced at $50. We think the stock will rise. However, we don't think the rise will be substantial, maybe just a movement of $5.
We then initiate a Vertical Spread on this stock. We Buy a $50 Call option, and Sell a $55 Call option. Let's assume that the $50 Call has a premium of $1 (since it's just In-The-Money), and the $55 Call has a premium of $0.25 (since it's $5 Out-Of-The-Money).
So we pay $1 for the $50 Call, and earn $0.25 off the $55 Call, giving us a total cost of $0.75.
Two things can happen. The stock can either rise, as predicted, or drop below the current price. Let's look at the 2 scenarios:
Scenario 1: The price has dropped to $45. We have made a mistake and predicted the wrong price movement. However, since both Calls are Out-Of-The-Money and will expire worthless, we don't have to do anything to Close the Position. Our loss would be the $0.75 we spent on this spread trading exercise.
Scenario 2: The price has risen to $55. The $50 Call is now $5 In-The-Money and has a premium of $6. The $55 Call is now just In-The-Money and has a premium of $1. We can't just wait till expiration date, because we sold a Call that's not covered by stocks we own (ie. a Naked Call). We therefore need to Close our Position before expiration.
So we need to sell the $50 Call which we bought earlier, and buy back the $55 Call that we sold earlier. So we sell the $50 Call for $6, and buy the $55 Call back for $1. This transaction has earned us $5, resulting in a nett gain of $4.25, taking into account the $0.75 we spent earlier.
What happens if the price of the stock jumps to $60 instead?
Here's where the - limited risk / limited profit - expression comes in. At a current price of $60, the $50 Call would be $10 In-The-Money and would have a premium of $11. The $55 Call would be $5 In-The-Money and would have a premium of $6. Closing the position will still give us $5, and still give us a nett gain of $4.25.
Once both Calls are In-The-Money, our profit will always be limited by the difference between the strike prices of the 2 Calls, minus the amount we paid at the start.
As a general rule, once the stock value goes above the lower Call (the $50 Call in this example), we start to earn profit. And when it goes above the higher Call (the $55 Call in this example), we reach our maximum profit.
So why would we want to perform this Spread?
If we had just done a simple Call option, we would have had to spend the $1 required to buy the $50 Call. In this spread trading exercise, we only had to spend $0.75, hence the - limited risk - expression. So you are risking less, but you will also profit less, since any price movement beyond the higher Call will not earn you any more profit. Hence this strategy is suitable for moderately bullish stocks.
HORIZONTAL SPREADS
We now look a Horizontal Spreads. Horizontal Spreads, otherwise known as Time Spreads or Calendar Spreads, are spreads where the strike prices of the 2 options stay the same, but the expiration dates differ.
To recap: Options have a Time Value associated with them. Generally, as time progresses, an option's premium loses value. In addition, the closer you get to expiration date, the faster the value drops.
This spread takes advantage of this premium decay.
Let's look at an example. Let's say we are now in the middle of June. We decide to perform a Horizontal Spread on a stock. For a particular strike price, let's say the August option has a premium of $4, and the September option has a premium of $4.50.
To initiate a Horizontal Spread, we would Sell the nearer option (in this case August), and buy the further option (in this case September). So we earn $4.00 from the sale and spend $4.50 on the purchase, netting us a $0.50 cost.
Let's fast-forward to the middle of August. The August option is fast approaching its expiration date, and the premium has dropped drastically, say down to $1.50. However, the September option still has another month's room, and the premium is still holding steady at $3.00.
At this point, we would close the spread position. We buy back the August option for $1.50, and sell the September option for $3.00. That gives us a profit of $1.50. When we deduct our initial cost of $0.50, we are left with a profit of $1.00.
That is basically how a Horizontal Spread works. The same technique can be used for Puts as well.
For more information on spread trading, visit:
http://www.option-trading-guide.com/spreads.html
About the Author
Steven is the webmaster of http://www.option-trading-guide.com If you would like to learn more about Option Trading or Technical Analysis, do visit for various strategies and resources to help your stock market investments.
Momentum day trading
Momentum day trading can be extremely profitable when done correctly .-
Day trading momentum stocks can be a very risky adventure. You can lose a lot of money when you pick the wrong opportunities.
The stockmarket can present you with a lot of hot stocks every day. Some of them are extremely risky while others are not as good as they seem. When you know how to identify and approach the best momentum stock opportuntites, you are able to generate a consistent and respectable amount of money in a very short period of time.
We know that day trading stocks with momentum is not the only way to make money investing online in stock market. But it can be the fastest way when you do it right. We also understand that a lot of people shy away from momentum stocktrading and think that only a few online stock traders can profit from it. It's true. Only those traders with proven knowledge have the ability to profit consistently from momentum stocks.
You don't necessarily have to trade momentum hot stocks all the time. But you can learn how to take advantage of them when you encounter the best stock opportunities while at the same time limiting your trading risk.
At ChatHotStocks.com Our hot stock trading methodology will show you how to take advantage of profitable day trading tactics that will improve the way you buy and sell momentum stocks from now on. Take a look at the valuable strategies and bonuses that you will get:
+ $ How to pick momentum stocks every day in an easy and fast way.
+ $ What kind of stocks to look for and how to classify the opportunities for greater trading profits.
+ $ Profitable momentum trading without technical analysis
+ $ What kind of stocks and "opportunities" to avoid and why. Save thousands in losses from trades gone bad in the future.
+ $ The "little details" you should look for before you consider a momentum daytrade.
+ $ Things to consider when trading low float momentum stocks
+ $ Buying micro cap and small cap stocks with momentum.
+ $ Trading NASDAQ stocks or OTCBB - OTC stocks ?
+ $ Getting ready for the trading breakout. Position your self for success.
+ $ Will my market rally last more than 5 minutes or less? What to do
+ $ It's all about the rally. The rest is just a bunch of elegant B.S. Learn to focus on what matters.
+ $ How to lock in profits on the way up
+ $ Should I hold overnight trading positions for a possible gap up ?
+ $ What to do if the stock rally stops moving.
+ $ Level 2 trading ( L 2 ) strategies for momentum.
+ $ Time frames for trading stocks with momentum, Pros and Cons
+ $ Premarket stock trading strategies and tips.
+ $ Trading momentum stock opportunities during market hours.
+ $ Trading at the open or waiting till the dust settles to make your move. It depends. This can make a big difference in your results.
+ $ Stock trading during lunch hour ?
+ $ After hours trading tactics and tips.
+ $ Become an expert of your hot stock watch list.
+ $ You don't need to watch the stock market all day. Profitable stocktraders have a better way.
+ $ Stock trading is not a job. Don't make it another rat race.
+ $ Watching charts and stocktrading all day ? Overtrading is not the way to go. Learn why
+ $ Testing the high probability trading plan
+ $ Stress free day trading tips and strategies for beginners and experienced daytraders.
+ $ Free stock market resources and tools for daytrading on line with our strategy.
+ $ Real examples of recent on line trading opportunities. Learn in a practical way.
Momentum trader strategies worth a constant Gold Mine at ChatHotStocks.com .-
Like an expert surfer that focuses on riding the big waves as much as possible or a shark that waits for the best moment to capture a big prey, those are the moves that we can show you how to catch every day with our powerful hot stock trading course.
Just picture your self waking up EVERY morning fresh and confident knowing you can spot, validate and take advantage of outstanding momentum trading opportunities that are capable of generating you very profitable results.
Get access TODAY to our powerful and disciplined momentum stock trading strategy today at Chat Hot Stocks
Log on to: http://www.chathotstocks.com
About the Author
Mike Robinson helps day traders take advantage of momentum hot stock opportunities every day at ChatHotStocks.com
Day trading momentum stocks can be a very risky adventure. You can lose a lot of money when you pick the wrong opportunities.
The stockmarket can present you with a lot of hot stocks every day. Some of them are extremely risky while others are not as good as they seem. When you know how to identify and approach the best momentum stock opportuntites, you are able to generate a consistent and respectable amount of money in a very short period of time.
We know that day trading stocks with momentum is not the only way to make money investing online in stock market. But it can be the fastest way when you do it right. We also understand that a lot of people shy away from momentum stocktrading and think that only a few online stock traders can profit from it. It's true. Only those traders with proven knowledge have the ability to profit consistently from momentum stocks.
You don't necessarily have to trade momentum hot stocks all the time. But you can learn how to take advantage of them when you encounter the best stock opportunities while at the same time limiting your trading risk.
At ChatHotStocks.com Our hot stock trading methodology will show you how to take advantage of profitable day trading tactics that will improve the way you buy and sell momentum stocks from now on. Take a look at the valuable strategies and bonuses that you will get:
+ $ How to pick momentum stocks every day in an easy and fast way.
+ $ What kind of stocks to look for and how to classify the opportunities for greater trading profits.
+ $ Profitable momentum trading without technical analysis
+ $ What kind of stocks and "opportunities" to avoid and why. Save thousands in losses from trades gone bad in the future.
+ $ The "little details" you should look for before you consider a momentum daytrade.
+ $ Things to consider when trading low float momentum stocks
+ $ Buying micro cap and small cap stocks with momentum.
+ $ Trading NASDAQ stocks or OTCBB - OTC stocks ?
+ $ Getting ready for the trading breakout. Position your self for success.
+ $ Will my market rally last more than 5 minutes or less? What to do
+ $ It's all about the rally. The rest is just a bunch of elegant B.S. Learn to focus on what matters.
+ $ How to lock in profits on the way up
+ $ Should I hold overnight trading positions for a possible gap up ?
+ $ What to do if the stock rally stops moving.
+ $ Level 2 trading ( L 2 ) strategies for momentum.
+ $ Time frames for trading stocks with momentum, Pros and Cons
+ $ Premarket stock trading strategies and tips.
+ $ Trading momentum stock opportunities during market hours.
+ $ Trading at the open or waiting till the dust settles to make your move. It depends. This can make a big difference in your results.
+ $ Stock trading during lunch hour ?
+ $ After hours trading tactics and tips.
+ $ Become an expert of your hot stock watch list.
+ $ You don't need to watch the stock market all day. Profitable stocktraders have a better way.
+ $ Stock trading is not a job. Don't make it another rat race.
+ $ Watching charts and stocktrading all day ? Overtrading is not the way to go. Learn why
+ $ Testing the high probability trading plan
+ $ Stress free day trading tips and strategies for beginners and experienced daytraders.
+ $ Free stock market resources and tools for daytrading on line with our strategy.
+ $ Real examples of recent on line trading opportunities. Learn in a practical way.
Momentum trader strategies worth a constant Gold Mine at ChatHotStocks.com .-
Like an expert surfer that focuses on riding the big waves as much as possible or a shark that waits for the best moment to capture a big prey, those are the moves that we can show you how to catch every day with our powerful hot stock trading course.
Just picture your self waking up EVERY morning fresh and confident knowing you can spot, validate and take advantage of outstanding momentum trading opportunities that are capable of generating you very profitable results.
Get access TODAY to our powerful and disciplined momentum stock trading strategy today at Chat Hot Stocks
Log on to: http://www.chathotstocks.com
About the Author
Mike Robinson helps day traders take advantage of momentum hot stock opportunities every day at ChatHotStocks.com
Sunday, July 03, 2005
Stock Rally ....... Buying stocks at the right time
Stock Rally ....... Buying stocks at the right time
The stock market can present you with a lot of hot stock opportunities every day at any time, either in pre market, regular market hours or the after hours session.
Some of them are extremely risky while others are not as good as they seem. When you know how to identify and approach the best momentum stock opportuntites, you are able to generate a consistent and respectable amount of money in a very short period of time.
We know that day trading stocks with momentum is not the only way to make money investing online in stock market. But it can be the fastest way when you do it right. We also understand that a lot of people shy away from momentum stocktrading and think that only a few online stock traders can profit from it. It's true. Only those traders with proven knowledge have the ability to profit consistently from momentum stocks.
You don't necessarily have to trade momentum hot stocks all the time. But you can learn how to take advantage of them when you encounter the best stock opportunities while at the same time limiting your trading risk.
At ProfitableStockMarket.com our hot stock trading methodology will show you how to take advantage of profitable day trading tactics that will improve the way you buy and sell momentum stocks from now on. Take a look at the valuable strategies and bonuses that you will get:
+ $ How to pick momentum stocks every day in an easy and fast way.
+ $ What kind of stocks to look for and how to classify the opportunities for greater trading profits.
+ $ Profitable momentum trading without technical analysis
+ $ What kind of stocks and "opportunities" to avoid and why. Save thousands in losses from trades gone bad in the future.
+ $ The "little details" you should look for before you consider a momentum daytrade.
+ $ Things to consider when trading low float momentum stocks
+ $ Buying micro cap and small cap stocks with momentum.
+ $ Trading NASDAQ stocks or OTCBB - OTC stocks ?
+ $ Getting ready for the trading breakout. Position your self for success.
+ $ Will my market rally last more than 5 minutes or less? What to do
+ $ It's all about the rally. The rest is just a bunch of elegant B.S. Learn to focus on what matters.
+ $ How to lock in profits on the way up
+ $ Should I hold overnight trading positions for a possible gap up ?
+ $ What to do if the stock rally stops moving.
+ $ Level 2 trading ( L 2 ) strategies for momentum.
+ $ Time frames for trading stocks with momentum, Pros and Cons
+ $ Premarket stock trading strategies and tips.
+ $ Trading momentum stock opportunities during market hours.
+ $ Trading at the open or waiting till the dust settles to make your move. It depends. This can make a big difference in your results.
+ $ Stock trading during lunch hour ?
+ $ After hours trading tactics and tips.
+ $ Become an expert of your hot stock watch list.
+ $ You don't need to watch the stock market all day. Profitable stocktraders have a better way.
+ $ Stock trading is not a job. Don't make it another rat race.
+ $ Watching charts and stocktrading all day ? Overtrading is not the way to go. Learn why
+ $ Testing the high probability trading plan
+ $ Stress free day trading tips and strategies for beginners and experienced daytraders.
+ $ Free stock market resources and tools for daytrading on line with our strategy.
+ $ Real examples of recent on line trading opportunities. Learn in a practical way.
Momentum trader strategies worth a constant Gold Mine at ProfitableStockMarket.com .-
Like an expert surfer that focuses on riding the big waves as much as possible or a shark that waits for the best moment to capture a big prey, those are the moves that we can show you how to catch every day with our powerful hot stock trading course.
Just picture your self waking up EVERY morning fresh and confident knowing you can spot, validate and take advantage of outstanding momentum trading opportunities that are capable of generating you very profitable results.
Get access to our powerful and disciplined momentum stock trading strategy today at Profitable Stock Market
Log on to: http://www.profitablestockmarket.com
About the Author
Jonathan Levington is a day trader helpipng stock traders take advantage of momentum stocks every day at ProfitableStockMarket.com
The stock market can present you with a lot of hot stock opportunities every day at any time, either in pre market, regular market hours or the after hours session.
Some of them are extremely risky while others are not as good as they seem. When you know how to identify and approach the best momentum stock opportuntites, you are able to generate a consistent and respectable amount of money in a very short period of time.
We know that day trading stocks with momentum is not the only way to make money investing online in stock market. But it can be the fastest way when you do it right. We also understand that a lot of people shy away from momentum stocktrading and think that only a few online stock traders can profit from it. It's true. Only those traders with proven knowledge have the ability to profit consistently from momentum stocks.
You don't necessarily have to trade momentum hot stocks all the time. But you can learn how to take advantage of them when you encounter the best stock opportunities while at the same time limiting your trading risk.
At ProfitableStockMarket.com our hot stock trading methodology will show you how to take advantage of profitable day trading tactics that will improve the way you buy and sell momentum stocks from now on. Take a look at the valuable strategies and bonuses that you will get:
+ $ How to pick momentum stocks every day in an easy and fast way.
+ $ What kind of stocks to look for and how to classify the opportunities for greater trading profits.
+ $ Profitable momentum trading without technical analysis
+ $ What kind of stocks and "opportunities" to avoid and why. Save thousands in losses from trades gone bad in the future.
+ $ The "little details" you should look for before you consider a momentum daytrade.
+ $ Things to consider when trading low float momentum stocks
+ $ Buying micro cap and small cap stocks with momentum.
+ $ Trading NASDAQ stocks or OTCBB - OTC stocks ?
+ $ Getting ready for the trading breakout. Position your self for success.
+ $ Will my market rally last more than 5 minutes or less? What to do
+ $ It's all about the rally. The rest is just a bunch of elegant B.S. Learn to focus on what matters.
+ $ How to lock in profits on the way up
+ $ Should I hold overnight trading positions for a possible gap up ?
+ $ What to do if the stock rally stops moving.
+ $ Level 2 trading ( L 2 ) strategies for momentum.
+ $ Time frames for trading stocks with momentum, Pros and Cons
+ $ Premarket stock trading strategies and tips.
+ $ Trading momentum stock opportunities during market hours.
+ $ Trading at the open or waiting till the dust settles to make your move. It depends. This can make a big difference in your results.
+ $ Stock trading during lunch hour ?
+ $ After hours trading tactics and tips.
+ $ Become an expert of your hot stock watch list.
+ $ You don't need to watch the stock market all day. Profitable stocktraders have a better way.
+ $ Stock trading is not a job. Don't make it another rat race.
+ $ Watching charts and stocktrading all day ? Overtrading is not the way to go. Learn why
+ $ Testing the high probability trading plan
+ $ Stress free day trading tips and strategies for beginners and experienced daytraders.
+ $ Free stock market resources and tools for daytrading on line with our strategy.
+ $ Real examples of recent on line trading opportunities. Learn in a practical way.
Momentum trader strategies worth a constant Gold Mine at ProfitableStockMarket.com .-
Like an expert surfer that focuses on riding the big waves as much as possible or a shark that waits for the best moment to capture a big prey, those are the moves that we can show you how to catch every day with our powerful hot stock trading course.
Just picture your self waking up EVERY morning fresh and confident knowing you can spot, validate and take advantage of outstanding momentum trading opportunities that are capable of generating you very profitable results.
Get access to our powerful and disciplined momentum stock trading strategy today at Profitable Stock Market
Log on to: http://www.profitablestockmarket.com
About the Author
Jonathan Levington is a day trader helpipng stock traders take advantage of momentum stocks every day at ProfitableStockMarket.com
Saturday, July 02, 2005
The Seven Most Traded Currencies in FOREX.
The Seven Most Traded Currencies in FOREX
Currencies are traded in dollar amounts called “lots”. One
lot is equal to $1,000, which controls $100,000 in currency.
This is what is known as the "margin". You can control $100,000
worth of currency for only 1,000 dollars. This is what is called “High Leverage”.
Currencies are always traded in pairs in the FOREX. The
pairs have a unique notation that expresses what currencies
are being traded. The symbol for a currency pair will always
be in the form ABC/DEF. ABC/DEF is not a real currency pair,
it is an example of a symbol for a currency pair. In this
example ABC is the symbol for one countries currency and DEF
is the symbol for another countries currency.
Here are some of the common symbols used in the Forex:
USD - The US Dollar
EUR - The currency of the European Union "EURO"
GBP - The British Pound
JPN - The Japanese Yen
CHF - The Swiss Franc
AUD - The Australian Dollar
CAD - The Canadian Dollar
There are symbols for other currencies as well, but these
are the most commonly traded ones.
A currency can never be traded by itself. So you can not
ever trade a EUR by itself. You always need to compare one
currency with another currency to make a trade possible.
Some of the common PAIRS are:
EUR/USD Euro / US Dollar
"Euro"
USD/JPY US Dollar / Japanese Yen
"Dollar Yen"
GBP/USD British Pound / US Dollar
"Cable"
USD/CAD US Dollar / Canadian Dollar
"Dollar Canada"
AUD/USD Australian Dollar/US Dollar
"Aussie Dollar"
USD/CHF US Dollar / Swiss Franc
"Swissy"
EUR/JPY Euro / Japanese Yen
"Euro Yen"
The listed currency pairs above look like a fraction. The
numerator (top of the fraction or "left" of the / however
you want to SEE it) is called the base currency. The
denominator (bottom of the fraction or "right" of the
/however you want to SEE it) is called the counter currency.
When you place an order to buy the EUR/USD, for instance,
you are actually buying the EUR and selling the USD. If you
were to sell the pair, you would be selling the EUR and
buying the USD. So if you buy or sell a currency PAIR, you
are buying/selling the base currency. You are always doing
the opposite of what you did with to base currency with the
counter currency.
If this seems confusing then you're in luck. You can always
get by with just thinking of the entire pair as one item.
Then you are just buying or selling that one item. Thinking
like this will still enable you to place trades. You only
need to be aware of the base/counter concept for Fundamental
Analysis issues.
So why is it important to know about the base/counter
currency? The base/counter currency concept illustrates
what is actually taking place in a Forex transaction. Some
of you reading this, know that short-selling was restricted
in the stock market *(Short-selling is where you sell a
stock/currency/option/commodity first and then try to buy it
back at a lower price later). But in the FOREX you are
always buying one currency (base) and selling another
(counter). If you sell the pair you are simply flipping
which one you buy and which one you sell. The transaction is
essentially the same. This allows you to short-sell with no
restrictions.
You want to be able to short-sell with no restrictions so
you can make money when the market drops as well as when it
rises. The problem with traditional stock market trading is
that the market has to go up for you to make money. With
FOREX trading you can make money in all directions.
http://www.1-forex.com
About the Author
FOREX Trader and Freelance writer.
http://www.1-forex.com
Currencies are traded in dollar amounts called “lots”. One
lot is equal to $1,000, which controls $100,000 in currency.
This is what is known as the "margin". You can control $100,000
worth of currency for only 1,000 dollars. This is what is called “High Leverage”.
Currencies are always traded in pairs in the FOREX. The
pairs have a unique notation that expresses what currencies
are being traded. The symbol for a currency pair will always
be in the form ABC/DEF. ABC/DEF is not a real currency pair,
it is an example of a symbol for a currency pair. In this
example ABC is the symbol for one countries currency and DEF
is the symbol for another countries currency.
Here are some of the common symbols used in the Forex:
USD - The US Dollar
EUR - The currency of the European Union "EURO"
GBP - The British Pound
JPN - The Japanese Yen
CHF - The Swiss Franc
AUD - The Australian Dollar
CAD - The Canadian Dollar
There are symbols for other currencies as well, but these
are the most commonly traded ones.
A currency can never be traded by itself. So you can not
ever trade a EUR by itself. You always need to compare one
currency with another currency to make a trade possible.
Some of the common PAIRS are:
EUR/USD Euro / US Dollar
"Euro"
USD/JPY US Dollar / Japanese Yen
"Dollar Yen"
GBP/USD British Pound / US Dollar
"Cable"
USD/CAD US Dollar / Canadian Dollar
"Dollar Canada"
AUD/USD Australian Dollar/US Dollar
"Aussie Dollar"
USD/CHF US Dollar / Swiss Franc
"Swissy"
EUR/JPY Euro / Japanese Yen
"Euro Yen"
The listed currency pairs above look like a fraction. The
numerator (top of the fraction or "left" of the / however
you want to SEE it) is called the base currency. The
denominator (bottom of the fraction or "right" of the
/however you want to SEE it) is called the counter currency.
When you place an order to buy the EUR/USD, for instance,
you are actually buying the EUR and selling the USD. If you
were to sell the pair, you would be selling the EUR and
buying the USD. So if you buy or sell a currency PAIR, you
are buying/selling the base currency. You are always doing
the opposite of what you did with to base currency with the
counter currency.
If this seems confusing then you're in luck. You can always
get by with just thinking of the entire pair as one item.
Then you are just buying or selling that one item. Thinking
like this will still enable you to place trades. You only
need to be aware of the base/counter concept for Fundamental
Analysis issues.
So why is it important to know about the base/counter
currency? The base/counter currency concept illustrates
what is actually taking place in a Forex transaction. Some
of you reading this, know that short-selling was restricted
in the stock market *(Short-selling is where you sell a
stock/currency/option/commodity first and then try to buy it
back at a lower price later). But in the FOREX you are
always buying one currency (base) and selling another
(counter). If you sell the pair you are simply flipping
which one you buy and which one you sell. The transaction is
essentially the same. This allows you to short-sell with no
restrictions.
You want to be able to short-sell with no restrictions so
you can make money when the market drops as well as when it
rises. The problem with traditional stock market trading is
that the market has to go up for you to make money. With
FOREX trading you can make money in all directions.
http://www.1-forex.com
About the Author
FOREX Trader and Freelance writer.
http://www.1-forex.com
Advantages of Trading FOREX over Stocks and Commodities.
Advantages of Trading FOREX over Stocks and Commodities
There are many advantages to Trading FOREX as your main income generator. Let’s start by something that may be worrying you already.
“Do I need a Diploma or some kind of Certification to trade FOREX?” The answer is this:
When attempting to make more profit than losses on the
fluctuation of exchange rates between major currencies
(i.e., Trading the FOREX), nobody is going to ask you for a
diploma, a formal license or verify the amount of hours
you've spent studying the Foreign exchange market and
banking industry.
All you need is the proper training, you can get very valuable sources for this training at http://www.1-forex.com.
But this is not the only advantage you get when trading FOREX, compared to other ways of investment and speculation; i.e. Stocks and Commodities. You have a whole bunch of advantages over these other options that will be enumerated in the following paragraphs.
The Main Benefits of Trading the FX Spot Market:
1): FOREX is the largest financial market in the world.
With a daily trading volume of over $1.5 trillion, the spot
FOREX market can absorb trading sizes that dwarf the
capacity of any other market. In fact, when compared with
the $50 billion daily market for equities or the $30 billion
futures market, it becomes quickly apparent this gives you,
and millions of other FOREX traders, almost infinite trading
liquidity and flexibility.
2): FOREX is a TRUE 24-hour market.
The FOREX Market never sleeps. Trading positions can be
entered and exited at any moment - around the globe, around
the clock, six days a week. There is no waiting for an
opening bell as in the case of trading stocks. It is a 24-
hour, continuous electronic (ONLINE) currency exchange that
never closes. This is very desirable for you if you want to
trade on a part-time basis, because you can choose when you
want to trade: morning, noon or night.
3): There is never a Bear Market in FOREX.
You can have access to a seamless, mutually-inclusive (two-
way) exchange of currencies. Meaning, because currencies
trade in "pairs" (for example, US dollar vs. yen or US
dollar vs. Swiss franc), one side of every currency pair
(for example, USD/JPY - JPY = YEN) is constantly moving in
relation to the other. Thus, when you buy a particular
currency, you are actually simultaneously selling the other
currency in that particular pair. As the market moves, one
of the currencies will increase in value versus the other.
Of course, it is up to you to choose the correct currency to
be long or short. Since currency trading always involves
buying one currency and selling another, there is no
structural bias to the market. This means you have equal
potential to profit in both a rising or falling market.
4): High Leverage - up to 200:1 Leverage.
You are permitted to trade foreign currencies on a highly
leveraged basis - up to 200 times your investment with some
brokers. This is primarily attributed to the higher levels
of liquidity within the currency markets. Standard 100,000-
unit currency lots can be traded with as little as 1%
margin, or $1,000. Mini FX accounts are permitted to trade
with just 0.5% margin -- in other words, just $50 allows you
to control a 10,000-unit currency position. Futures traders,
who are accustomed to margin requirements generally equal to
5%-8% of the contract value, will immediately recognize that
the FOREX market provides much greater leverage, and for
stock traders, who must post at least 50% margin, there’s no
comparison. If you’re looking for an efficient use of
trading capital, this is it!
5): Price Movements Are Highly Predictable.
Although currency prices in the FX market may be volatile,
they generally repeat themselves in relatively predictable
cycles, creating trends. The strong trends that foreign
currencies develop are a significant advantage for traders
who use the "technical" methods and strategies taught at the sources found in http://www.1-forex.com
Unlike stocks, currencies rarely spend much time in tight
trading ranges and have the tendency to develop strong
trends. Over 80% of volume is speculative in nature and, as
a result, the market frequently overshoots and then corrects
itself. As a technically-trained trader, you can easily
identify new trends and breakouts, which provide for
multiple opportunities to enter and exit positions.
6:) Commission-free Trading and Low Transaction Cost
When you trade FOREX, through one of our recommended brokers
(this info is in our private resources section), you'll do
it totally commission-free! These brokers don't charge
commissions to trade or to maintain an account, and that
goes for all clients trading the FOREX through them,
regardless of your account balance or trading volume. Even
Mini FX traders can buy and sell currencies online,
commission-free.
What about trading fees? There are none of the usual fees to
which futures and equity traders are accustomed -- no
exchange or clearing fees, no N_F_A or S_E_C fees. Because
currencies trade over-the-counter (OTC), via a global
electronic network -- in FOREX, what you see is what you
get, allowing you to make quick decisions on your trades
without having to worry or account for fees that may affect
your profit/loss or slippage.
In the equities markets, you must pay both a commission and
exchange fees. The over-the-counter structure of the FX
market eliminates exchange and clearing fees, which in turn
lowers transaction costs.
So, if FOREX broker don't charge commissions, how do they
make money? Like all traded financial products, over-the-
counter currency trading involves a bid/ask spread, which
represents the prices at which your counterparty is willing
to trade. Because the currency market offers round-the-clock
liquidity, you receive tight, competitive spreads both
intra-day and night. Stock traders can be more vulnerable to
liquidity risk and typically receive wider trading spreads,
especially during after-hours trading.
7): Instantaneous Order Execution and Market Transparency.
Market transparency is highly desired in any trading
environment. The greater the market transparency, the more
efficient the market becomes. Unlike other markets where
transparency is compromised (like in the Enron scandal),
FOREX markets are highly transparent (i.e., analyzing
countries, and having access to real-time research / news,
is easier than companies).
Because of this transparency, as an FX trader, you will be
able to exercise risk management strategies in accordance to
the fundamental and technical indicators we teach at
RapidForex.com
The FX market offers the highest level of market
transparency out of all the financial markets. Because of
this, order execution and fill confirmation usually occur in
just 1-2 seconds. Markets that do not offer executable
prices and force traders to absorb slippage obviously
compromise the trader's profit potential considerably.
In the forex world, order execution is all-electronic and
because you'll be trading via an Internet-based platform,
instantaneous execution is routine. There are no exchanges,
no traditional open-outcry pits, no floor brokers, and
consequently, no delays.
http://www.1-forex.com
About the Author
FOREX Trader and Freelance writer.
http://www.1-forex.com
There are many advantages to Trading FOREX as your main income generator. Let’s start by something that may be worrying you already.
“Do I need a Diploma or some kind of Certification to trade FOREX?” The answer is this:
When attempting to make more profit than losses on the
fluctuation of exchange rates between major currencies
(i.e., Trading the FOREX), nobody is going to ask you for a
diploma, a formal license or verify the amount of hours
you've spent studying the Foreign exchange market and
banking industry.
All you need is the proper training, you can get very valuable sources for this training at http://www.1-forex.com.
But this is not the only advantage you get when trading FOREX, compared to other ways of investment and speculation; i.e. Stocks and Commodities. You have a whole bunch of advantages over these other options that will be enumerated in the following paragraphs.
The Main Benefits of Trading the FX Spot Market:
1): FOREX is the largest financial market in the world.
With a daily trading volume of over $1.5 trillion, the spot
FOREX market can absorb trading sizes that dwarf the
capacity of any other market. In fact, when compared with
the $50 billion daily market for equities or the $30 billion
futures market, it becomes quickly apparent this gives you,
and millions of other FOREX traders, almost infinite trading
liquidity and flexibility.
2): FOREX is a TRUE 24-hour market.
The FOREX Market never sleeps. Trading positions can be
entered and exited at any moment - around the globe, around
the clock, six days a week. There is no waiting for an
opening bell as in the case of trading stocks. It is a 24-
hour, continuous electronic (ONLINE) currency exchange that
never closes. This is very desirable for you if you want to
trade on a part-time basis, because you can choose when you
want to trade: morning, noon or night.
3): There is never a Bear Market in FOREX.
You can have access to a seamless, mutually-inclusive (two-
way) exchange of currencies. Meaning, because currencies
trade in "pairs" (for example, US dollar vs. yen or US
dollar vs. Swiss franc), one side of every currency pair
(for example, USD/JPY - JPY = YEN) is constantly moving in
relation to the other. Thus, when you buy a particular
currency, you are actually simultaneously selling the other
currency in that particular pair. As the market moves, one
of the currencies will increase in value versus the other.
Of course, it is up to you to choose the correct currency to
be long or short. Since currency trading always involves
buying one currency and selling another, there is no
structural bias to the market. This means you have equal
potential to profit in both a rising or falling market.
4): High Leverage - up to 200:1 Leverage.
You are permitted to trade foreign currencies on a highly
leveraged basis - up to 200 times your investment with some
brokers. This is primarily attributed to the higher levels
of liquidity within the currency markets. Standard 100,000-
unit currency lots can be traded with as little as 1%
margin, or $1,000. Mini FX accounts are permitted to trade
with just 0.5% margin -- in other words, just $50 allows you
to control a 10,000-unit currency position. Futures traders,
who are accustomed to margin requirements generally equal to
5%-8% of the contract value, will immediately recognize that
the FOREX market provides much greater leverage, and for
stock traders, who must post at least 50% margin, there’s no
comparison. If you’re looking for an efficient use of
trading capital, this is it!
5): Price Movements Are Highly Predictable.
Although currency prices in the FX market may be volatile,
they generally repeat themselves in relatively predictable
cycles, creating trends. The strong trends that foreign
currencies develop are a significant advantage for traders
who use the "technical" methods and strategies taught at the sources found in http://www.1-forex.com
Unlike stocks, currencies rarely spend much time in tight
trading ranges and have the tendency to develop strong
trends. Over 80% of volume is speculative in nature and, as
a result, the market frequently overshoots and then corrects
itself. As a technically-trained trader, you can easily
identify new trends and breakouts, which provide for
multiple opportunities to enter and exit positions.
6:) Commission-free Trading and Low Transaction Cost
When you trade FOREX, through one of our recommended brokers
(this info is in our private resources section), you'll do
it totally commission-free! These brokers don't charge
commissions to trade or to maintain an account, and that
goes for all clients trading the FOREX through them,
regardless of your account balance or trading volume. Even
Mini FX traders can buy and sell currencies online,
commission-free.
What about trading fees? There are none of the usual fees to
which futures and equity traders are accustomed -- no
exchange or clearing fees, no N_F_A or S_E_C fees. Because
currencies trade over-the-counter (OTC), via a global
electronic network -- in FOREX, what you see is what you
get, allowing you to make quick decisions on your trades
without having to worry or account for fees that may affect
your profit/loss or slippage.
In the equities markets, you must pay both a commission and
exchange fees. The over-the-counter structure of the FX
market eliminates exchange and clearing fees, which in turn
lowers transaction costs.
So, if FOREX broker don't charge commissions, how do they
make money? Like all traded financial products, over-the-
counter currency trading involves a bid/ask spread, which
represents the prices at which your counterparty is willing
to trade. Because the currency market offers round-the-clock
liquidity, you receive tight, competitive spreads both
intra-day and night. Stock traders can be more vulnerable to
liquidity risk and typically receive wider trading spreads,
especially during after-hours trading.
7): Instantaneous Order Execution and Market Transparency.
Market transparency is highly desired in any trading
environment. The greater the market transparency, the more
efficient the market becomes. Unlike other markets where
transparency is compromised (like in the Enron scandal),
FOREX markets are highly transparent (i.e., analyzing
countries, and having access to real-time research / news,
is easier than companies).
Because of this transparency, as an FX trader, you will be
able to exercise risk management strategies in accordance to
the fundamental and technical indicators we teach at
RapidForex.com
The FX market offers the highest level of market
transparency out of all the financial markets. Because of
this, order execution and fill confirmation usually occur in
just 1-2 seconds. Markets that do not offer executable
prices and force traders to absorb slippage obviously
compromise the trader's profit potential considerably.
In the forex world, order execution is all-electronic and
because you'll be trading via an Internet-based platform,
instantaneous execution is routine. There are no exchanges,
no traditional open-outcry pits, no floor brokers, and
consequently, no delays.
http://www.1-forex.com
About the Author
FOREX Trader and Freelance writer.
http://www.1-forex.com
Example of a Profitable Transaction in FOREX.
Example of a Profitable Transaction in FOREX
As it was mentioned earlier, there are TWO timeless rules of Investing in FOREX:
RULE #1) ~ Cut your losers; let your winners ride.
YOU WILL HAVE LOSING TRADES.
We do. Every FOREX trader does. The key to being a
consistent, predictable, reliable trader is to, at the end
of the day, add up more wins than losses. And, when you KNOW
(based off your trading rules), without a doubt, that YES,
indeed you are, in a losing trade, don't keep losing money
(lowering your stop loss) just to *prove you are right* or
your rules are wrong (however you want to look at it).
Let's face it - you can't turn a sow's ear into a silk
purse. You can't change the spots of a leopard and you can't
turn chicken poop into chicken salad. The best trades are
usually "right" immediately (the techniques, rules, methods
and strategies we teach at RapidForex.com will be your best
indicator for just what a "right" trade really is).
Remember, people have been trading the markets for a hundred
and sixty years. The smart traders know there's going to be
another trade. Cut your loses short and compound those
winning positions.
RULE #2) ~ Thou Shall Not Trade the FOREX Without the
Placing of a Stop Loss Order.
When you place a STOP order, right along with your ENTRY
order, via your online trade station, you've just
automatically prevented a potential loss from "running" too
far.
Before initiating any trade, if you haven't already figured
out at what point you would be wrong and would want to cut
your loses or, at the very least, reevaluate your position
from the sidelines, then you shouldn't be putting on the
trade in the first place.
Show us a FOREX trader who doesn't use stop loss orders and
we'll show you someone who loses a lot of money.
To make a profit, in the FOREX, a trader (possibly YOU
soon?) can enter the market as a *buy position* (known as
going "long") or a *sell position* (known as going "short").
For discussion, let's assume you've been studying the EURO.
Your trading methods, rules, strategies, etc., tell you that
prices will rise during a particular timeframe. So you buy
the EUR/USD pair (or, technically, you will simultaneously
buy euros, the base currency, and sell dollars).
You open up your handy trading station software (provided to
you for free by the online broker), which resides on your
desktop, and you see that the EUR/USD pair is trading at:
<< EUR/USD: 1.3242/45 >>
REMEMBER: the quote to the left of the / (1.3242) refers to
the bid or "sell" price (what you obtain in USD when you
sell EUR). The quote to the right of the / (1.3245) is used
to obtain the ask or "buy" price (what you have to pay in
USD if you buy EUR).
So, since you believe that the market price for the EUR/USD
pair will go higher, you will enter a *buy position* in the
market. For simplicities sake, let's say you bought one lot
at 1.3245. As long as you sell back the pair at a higher
price, then you make money.
But, no worries. This seemingly elaborate process is
handled, and even calculated for you, via the broker's
software mentioned above. The chart software and the quote
board are in agreement with all sides of the currencies.
To illustrate a typical FX SELL trade, consider this
scenario involving the USD/JPY currency pair:
REMEMBER ~ Selling ("going short") the currency pair implies
selling the first, base currency, and buying the second,
quote currency. You sell the currency pair if you believe
the base currency (USD) will go down relative to the quote
currency (JPY), or equivalently, that the quote currency
(JPY) will go up relative to the base currency (USD).
NOTE: while the Profit Calculations, on the Short-sell trade
scenario below, may seem somewhat complicated if you've
never been in the FOREX market before, trust us when we say,
"this process is nearly seamless through your broker trade
station (software). We're just showing you this thought-
process below so you can SEE how a PROFIT occurs even when
SELLING a currency pair.
The current bid/ask price for USD/JPY is 105.26/105.30,
meaning you can buy $1 US for 105.30 Japanese YEN or sell $1
US for 105.26 YEN.
Suppose you decide that the US Dollar (USD) is overvalued
against the YEN (JPY). To execute this strategy, you would
sell Dollars (simultaneously buying YEN), and then wait for
the exchange rate to rise.
So you make the trade: selling US $100,000 and purchasing
10,526,000 YEN. (Remember, at 1% margin, your initial margin deposit would be $1,000.)
As you expected, USD/JPY falls to 104.26/104.30, meaning you
can now buy $1 US for $104.30 Japanese YEN or sell $1 US for
104.26
Since you're short dollars (and are long YEN), you must now
buy dollars and sell back the YEN to realize any profit.
You buy US $100,000 at the current USD/JPY rate of 104.30,
and receive 10,430,000 YEN. Since you originally bought
(paid for) 10,526,000 YEN, your profit is 96,000 YEN.
To calculate your P&L in terms of US dollars, simply divide
96,000 by the current USD/JPY rate of 104.30.
Total profit = US $920.42
About the Author
Adrian Pablo, FOREX Trader and Freelance Writer.
http://www.1-forex.com
As it was mentioned earlier, there are TWO timeless rules of Investing in FOREX:
RULE #1) ~ Cut your losers; let your winners ride.
YOU WILL HAVE LOSING TRADES.
We do. Every FOREX trader does. The key to being a
consistent, predictable, reliable trader is to, at the end
of the day, add up more wins than losses. And, when you KNOW
(based off your trading rules), without a doubt, that YES,
indeed you are, in a losing trade, don't keep losing money
(lowering your stop loss) just to *prove you are right* or
your rules are wrong (however you want to look at it).
Let's face it - you can't turn a sow's ear into a silk
purse. You can't change the spots of a leopard and you can't
turn chicken poop into chicken salad. The best trades are
usually "right" immediately (the techniques, rules, methods
and strategies we teach at RapidForex.com will be your best
indicator for just what a "right" trade really is).
Remember, people have been trading the markets for a hundred
and sixty years. The smart traders know there's going to be
another trade. Cut your loses short and compound those
winning positions.
RULE #2) ~ Thou Shall Not Trade the FOREX Without the
Placing of a Stop Loss Order.
When you place a STOP order, right along with your ENTRY
order, via your online trade station, you've just
automatically prevented a potential loss from "running" too
far.
Before initiating any trade, if you haven't already figured
out at what point you would be wrong and would want to cut
your loses or, at the very least, reevaluate your position
from the sidelines, then you shouldn't be putting on the
trade in the first place.
Show us a FOREX trader who doesn't use stop loss orders and
we'll show you someone who loses a lot of money.
To make a profit, in the FOREX, a trader (possibly YOU
soon?) can enter the market as a *buy position* (known as
going "long") or a *sell position* (known as going "short").
For discussion, let's assume you've been studying the EURO.
Your trading methods, rules, strategies, etc., tell you that
prices will rise during a particular timeframe. So you buy
the EUR/USD pair (or, technically, you will simultaneously
buy euros, the base currency, and sell dollars).
You open up your handy trading station software (provided to
you for free by the online broker), which resides on your
desktop, and you see that the EUR/USD pair is trading at:
<< EUR/USD: 1.3242/45 >>
REMEMBER: the quote to the left of the / (1.3242) refers to
the bid or "sell" price (what you obtain in USD when you
sell EUR). The quote to the right of the / (1.3245) is used
to obtain the ask or "buy" price (what you have to pay in
USD if you buy EUR).
So, since you believe that the market price for the EUR/USD
pair will go higher, you will enter a *buy position* in the
market. For simplicities sake, let's say you bought one lot
at 1.3245. As long as you sell back the pair at a higher
price, then you make money.
But, no worries. This seemingly elaborate process is
handled, and even calculated for you, via the broker's
software mentioned above. The chart software and the quote
board are in agreement with all sides of the currencies.
To illustrate a typical FX SELL trade, consider this
scenario involving the USD/JPY currency pair:
REMEMBER ~ Selling ("going short") the currency pair implies
selling the first, base currency, and buying the second,
quote currency. You sell the currency pair if you believe
the base currency (USD) will go down relative to the quote
currency (JPY), or equivalently, that the quote currency
(JPY) will go up relative to the base currency (USD).
NOTE: while the Profit Calculations, on the Short-sell trade
scenario below, may seem somewhat complicated if you've
never been in the FOREX market before, trust us when we say,
"this process is nearly seamless through your broker trade
station (software). We're just showing you this thought-
process below so you can SEE how a PROFIT occurs even when
SELLING a currency pair.
The current bid/ask price for USD/JPY is 105.26/105.30,
meaning you can buy $1 US for 105.30 Japanese YEN or sell $1
US for 105.26 YEN.
Suppose you decide that the US Dollar (USD) is overvalued
against the YEN (JPY). To execute this strategy, you would
sell Dollars (simultaneously buying YEN), and then wait for
the exchange rate to rise.
So you make the trade: selling US $100,000 and purchasing
10,526,000 YEN. (Remember, at 1% margin, your initial margin deposit would be $1,000.)
As you expected, USD/JPY falls to 104.26/104.30, meaning you
can now buy $1 US for $104.30 Japanese YEN or sell $1 US for
104.26
Since you're short dollars (and are long YEN), you must now
buy dollars and sell back the YEN to realize any profit.
You buy US $100,000 at the current USD/JPY rate of 104.30,
and receive 10,430,000 YEN. Since you originally bought
(paid for) 10,526,000 YEN, your profit is 96,000 YEN.
To calculate your P&L in terms of US dollars, simply divide
96,000 by the current USD/JPY rate of 104.30.
Total profit = US $920.42
About the Author
Adrian Pablo, FOREX Trader and Freelance Writer.
http://www.1-forex.com
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