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Whitewater Stock Market

Feb 20

Posted by admin in Stocks Mutual Funds

Ever done any whitewater rafting or canoeing? Long periods of tranquil river followed by short periods of terror. Suddenly the water grips your vessel and you are pushed and shoved by massive currents over which you have no control. Missing boulders you paddle as hard as you can. You almost lose everything and think to yourself, “Why didn’t I portage that last rapid”

Remind you of the stock market lately? Nice steady up moves of equity growth in your portfolio followed by gut-wrenching waterfalls when the market takes back most of your gains.

You got into that canoe because you wanted to. Did you have any lessons on how to control the ride or when it might be a good idea to portage? Maybe you didn’t or maybe you got the wrong lesson. You didn’t want to crash or drown.

The same goes for the stock market. You might have read a book on how to invest your money or worse yet you might have received information from a broker or financial planner whose reason for helping you is based on commission. If you are a small account don’t plan on getting much ?help?.

Brokers are not taught how to make money. They are taught to make recommendations that will not get them sued if you lose your money. The basic Wall Street tenet of Buy and Hold is totally wrong. Unfortunately, even the brokers believe it. When you have a stock or mutual fund that is going down they never tell you to sell ? ?you are in for the long haul?. WRONG. Of 33,000 stock recommendations last year only 127 were ‘sells?. After stocks have declined 50% they tell you to “hold”. You know where. Brokerage companies do not want to offend the corporate executives and mutual fund managers; they seem to have forgotten who is paying them.

When you are whitewater rafting you had better know how to guide yourself through or around the rapids to the calm water. When you invest in the market you must learn the first basic rule ? protect your capital ? so you won’t crash and lose all you have worked for. In canoeing it means learning when to paddle or portage. With investing it means learning when to sell, be in cash and out of the market. Know when to hold em, know when to fold em.

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The Warren Buffet Philosophy

Feb 2

Posted by admin in Insurance

In addition to being one of the world’s wealthiest men, Warren Buffet is also known for his common sense investment advice. Instead of chasing hot stocks and market trends, the straight-shooting septuagenarian preaches simple and logical investment strategies that even the least financially inclined investors can follow. While there are as many stock-picking strategies as there are stocks to pick, Buffet’s long-run returns serve as compelling testimony to the effectiveness of his methods.

While numerous books have been written about Buffet’s investment advice, the primary focus of his philosophy is to look for companies with strong intrinsic value. Rather than relying solely on balance sheets or assumptions of value, he encourages investors to reflect on the nature of the company and its future. Who are their competitors? Is it a business with a high degree of customer loyalty? What are the barriers to entry? Are there any major logistical flaws in the company’s business plan? By following Buffet’s advice, an individual would have fared well through the technology bubble of the 1990s. The acceptable downside to this investment strategy is that the investor would also have missed out on many profitable opportunities that existed before tech stocks began to plummet.

In keeping with his common sense investment advice, Buffet emphasizes that an investor should invest in companies that he or she understands. He reasons that investing in the latest technology-oriented hot stock may lead an investor away from the use of common sense valuation techniques, causing the investor to make decisions based on hype rather than logic. Along those lines, he has been quoted advising individuals to invest in the companies where they spend their own money. Since doing business with a company is one of the best ways to see how it operates, it stands to reason that it would offer insight about the company’s value as an investment. Instead of selecting companies that ?everyone? is talking about, he argues that you should buy shares of the companies that everyone you know is doing business with, especially if price and market interest levels don’t seem to reflect the quality you know is there.

While Buffet offers excellent non-technical investment advice, he also offers tips for those who know their way around a balance sheet. Instead of looking for companies that pay large dividends on a regular basis, he advises investors to seek out companies with a pattern of stable growth and reinvestment. His own company, Berkshire Hathaway, has only paid a dividend to shareholders on one occasion. At that time, he announced that he simply could not find a better use of the funds. Buffet also stresses that it is important to seek out companies with low debt-to-equity ratios and maintenance costs. A company with minimal debt obligations puts itself in a better position to weather temporary economic downturns.

Although most of Buffet’s investment advice focuses on the actual company in question, timing is also an important component of his strategy. Rather than dumping a company when everyone else is dumping it, he prefers to pillage through the scraps to determine if the downturn provides a good investment opportunity. In fact, this very strategy helped him earn millions on American Express after he invested during a fraud scandal. Because market trends are often based on incomplete information, there is a tendency of investors to overreact. That overreaction is a big part of what Buffet’s investment strategy counts on.

Despite the fierce proponents of hot stocks and market trends, very few investment strategies are able to stand the test of time. Warren Buffet’s common sense investment advice has done exactly that, allowing him and many others to enjoy above average returns in occasionally dreary financial markets.

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Costa Rica Property for Sale – Prices up 300% in 10 Years, and more to come

Jan 26

Posted by admin in Real Estate

If you’re looking to buy property as an investment, then the property for sale in Costa Rica offers you the chance to make substantial gains in the coming years – with low risk.

Buying Costa Rican property is inexpensive and easy – and prices are on the move.

Here we look at Costa Rica property for sale, and the importance of location – which will help you make even bigger capital gains on your investment.

So, when you’re looking at the Costa Rican property that’s for sale, what do you need to consider for making the big capital gains?

The Last 10 years have Shown 300% Growth

The biggest change in the Costa Rica property for sale during the past decade is that prices have doubled, or tripled in many locations ? and the good news is – it’s still cheap!

Costa Rican property prices range considerably:

. 1/4-acre beachfront home sites ranges from $50,000 to upwards of $200,000.

. Beachfront homes range from $165,000 upwards.

. Seaside condominiums range from $55,000 to $250,000 – depending on size and geographical location.

. Just inland – maybe a 10-minute walk to the beach, two-bedroom, two-bathroom, homes start at $40,000 – and single-family building lots start at $6,500

. Less expensive deals can be found in more remote areas – such as the northern Osa Peninsula in Costa Rica’s southern region.

Popular Places

Most realtors agree that the best turnover, and fastest-selling properties are generally located in the Central Valley, and along the Pacific coast – and it’s here that you can get the best capital gain on your investment.

Although the Central Valley covers just five percent of Costa Rica, it contains the vast majority of the country’s population. Therefore, property prices around the greater metropolitan area (including San Jos?, Alajuela, Heredia and Escaz?) – where many of the country’s businesses and services are located, tend to be among the highest in Costa Rica.

Generally, the farther away from town you go, the lower the prices of property for sale will be. The exception to this rule is the central and northern Pacific coast – where a number of major developments are underway.

Property for Sale in Costa Rica – the Secret of Big Returns

Here you need to get out your map of Costa Rica, and look at areas set to increase in value – simply watch for changes in the infrastructure that will boost property prices.

Buying property that’s for sale in Costa Rica can give you great returns – but if you build in advance of important building projects that will enhance local amenities – and the quality of life, will make you even more money.

So, what sort of changes in the infrastructure are we referring to? Let’s look at three projects currently underway that look set to increase property prices in adjacent areas:

New Freeway: Scheduled to be completed shortly. The freeway will link the largest cities to the Pacific Coast – generating an increased flow of traffic and buying interest in areas with easy access to the freeway.

New Marina: The largest marina in Costa Rica will be completed shortly in Quepos.

New Airport: A new international airport is coming to the town of Orotina in the near future.

When buying property for sale in Costa Rica, being in ahead of the crowd – before an important part of the infrastructure is completed, will enable you to take advantage of the increased demand for real estate in the areas that these changes will benefit.

Buying Property that’s for Sale in Costa Rica is Straightforward

The government encourages investors ? they place no restrictions on foreigners. In fact, foreigners are entitled to the same ownership rights as Costa Rican citizens. When you factor in low costs, and no capital gains tax, overseas buyers will continue to buy the property that’s available in Costa Rica.

Property for sale in Costa Rica as an investment

Buying property currently for sale in Costa Rica can be a rewarding experience. The future looks bright – as the big fluctuations in property prices that you see in the United States, doesn’t happen in Costa Rica.

Based on past history, prices either go up by at least 10 percent per year – or at worst, stay the same. When the real estate market is in a downturn, properties don’t tend to go down in value – they stay static – making this a low risk way to invest.

Currently, the chances of a downturn in the market now look slim ? due to the rising number of investment property buyers.

If you want to double or triple your money in the next few years, think about the Costa Rican real estate market – and buy some building lots or property.

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Lies, Damn Lies and Mutual Fund Returns

Jan 12

Posted by admin in Stocks Mutual Funds

How many times has this happened to you? You’re at a social function and the conversation turns to investing. Pretty soon, people are comparing how well their investments are doing. As you might imagine, being an investment advisor this happens to me a lot. However, I recently had an experience with it that startled me.

Bob, one of the guys I was chatting with at a party, asked what kind of returns I had made for my clients with my methodical no load mutual fund strategy during the past year. I replied that they had unrealized gains of slightly over 29%, after management fees, for the 8 months that we were invested.

Bob countered with a smirk that he had made a 40% return. I raised my eyebrows and told him that was darn good?and suggested that maybe he ought to be managing my money. At that point we were interrupted and, as the evening went on, I began to wonder exactly how Bob had gotten his great return.

I cornered him a little later on and, upon digging a little deeper, the story looked somewhat different. Yes, he had made a 40% return on a mutual fund he had some money invested in, however, we were comparing apples and bananas.

He had a total portfolio of $100k. Being cautious, he had invested only $10k into a mutual fund, from which he profited $4k after he sold it. The balance of his portfolio ($90k) was sitting in a money market fund earning some 0.35% per year.

So, while he had made 40% on 10% of his investment, he had only made 4.35% on his whole portfolio. My methodology was also focused on protecting my clients’ investments and it had increased their entire portfolio 29% (unrealized). That would be an apple to apple comparison when measuring my returns against his. Bob’s one fund realized 40% return. However, had I approached it the same way Bob had, I could have described one of the funds I used that had realized over 49% for the same period.

Actually, Bob’s not-so-good-news story didn’t stop there. Bob admitted to having followed the losing Buy and Hope strategy through the bear market of 2000 and had finally sold out at a 50% loss a year ago, before committing $10k to a mutual fund investment.

I was pleased to be able to tell him that my methodology had gotten my clients out of the market before the bear took his big bite, and they suffered only minimal losses before finding safety in money markets accounts. And when my trend tracking figures directed us to move back into the market, they still had most of their money poised to start earning for them again?which it did and very nicely, thank you.

The moral of the story is to look past the surface and don’t take any numbers thrown at you at face value. Remember, most people returning from a weekend in Las Vegas will shout about their winnings and mumble about their losses.

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Setting Your Homes Listing Price

Dec 10

Posted by admin in Real Estate

When it comes to buying a home, most home buyers will filter the homes they are interested in by listing price. When buying a home the price is typically the number one criteria for choosing which home to buy. Ultimately it is the buyer that determines the selling price of your home. So how can you get the most return on your investment when selling your home? The simple answer to this question is educate yourself on the local real estate market. Finding local real estate information is fairly simple to obtain and easy to interpret.

One of the best places to start is to look on the Internet and see homes for sale in your general area. Filter the homes you look at by the amenities and attributes of your own home. This should give you a general price range of what others are asking for their home. Another method is to contact a real estate agent and ask them to provide you with a CMA, comparative market analysis. A CMA analyses is great to have and it offers valuable information on the past and current real estate market.

Obtaining a CMA is easy and typically free. Of course the real estate agent provides a CMA in hopes of listing your home. A great way to get several CMAs to compare is to contact several real estate agents and have them all do a CMA on your home. Review the information and list your home with the real estate agent that provided you with the most informative and comprehensive CMA. If they did a bang up job on gathering that information chances are they will do a great job in marketing your home.

Keep in mind that the real estate agent does not set the price of your home. That is completely up to you. Gather the facts and make the best decision you can when setting your price. If the real estate market is strong and your home does not sell or get much traffic that may be a sign that you priced your home to high. The key to selling your home in a reasonable amount of time is correct pricing and the real estate market reacts quickly to homes that are priced well.

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What It means To Be Truly Wealthy

Oct 23

Posted by admin in Wealth Building

Most of the wealthiest people in the world don’t look that way at first glance. You’d never look at them twice in an elevator or on the street, in fact. That’s because the truly wealthy don’t flash their money by driving high-profile cars or wearing designer clothes. The surprising fact about genuinely wealthy people is that, unlike middle-class folks who try to look richer than they are, the really rich aren’t big spenders.

According to the book “The Millionaire Mind” by Thomas J. Stanley, millionaires are far less profligate with their money than most people think. For starters, they live below their means and have very little debt most of them pay off their credit cards every month, and over a third of them have no mortgages on their homes. They put a large amount of income into savings and investments ” 20 percent, on average ” and they think about value when they shop, driving older cars and wearing off-the-rack clothes.

Millionaires are also self-made. Most didn’t inherit their money  they earned it themselves through their work as executives or business owners. And most of them are well educated, as 90 percent are college graduates with over half of them holding advanced degrees. They weren’t the valedictorians, however. Most were B students, coming out of college with an appreciation for hard work and discipline. Over half of them attend church at least once a month, with over a third of millionaires considering themselves very religious.

So what does this mean to you? It means that the rich aren’t as different from the rest of us as we imagined. Very few of the inherited their money ? that means that it’s possible for you to become a millionaire yourself, if you find the right combination of opportunity, attitude and commitment. When asked by Stanley what the ingredients of success were, luck wasn’t a factor. Their answer: integrity, discipline, social skills, a supportive spouse, and hard work.

The biggest difference between the wealthy and everyone else is that they’re investors rather than consumers. They’re frugal with their spending, keeping a close watch on how much they spend on disposable items that offer no return on their investment like food, clothes, cars and household items. Instead, they try to make their money work for them by buying real estate, investing in stocks and mutual funds, and buying insurance with a guaranteed return.

To put it another way, wealthy people look at their money differently. They use it in ways that it will grow, ensuring that they continue to have lots of money in the future. If you’re like most people, you look at money as something to spend ? you get paid, then you pay your bills and, if there’s anything left over, you buy something with it. If you’re feeling unhappy or stressed, you buy a DVD or go to a nice restaurant. When you have a sudden emergency, like car repairs or a broken water heater, you pay for it with a credit card because you don’t have the money. Your habits are the habits of poor people, not of rich people, and it affects your bank balance.

So start thinking and acting like a wealthy person. Make a budget and stick to it. Shop for bargains. Avoid credit cards, and pay down the debt you already have. Start putting money into savings, even if it’s just a small amount each month. With the right outlook, you’ll find that your own personal wealth will start to grow.

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Spanish Property Investments

Oct 12

Posted by admin in Real Estate

Costa Blanca, Costa Almeria, Costa Calida, in fact wherever you look on the Spanish Costas Property prices are still rising. From an investment point of view that?s a good thing however, if it?s an affordable Spanish property to use as a home from home in Spain you are looking for the news is not that good, or is it?

Property prices in the UK are slowing down and it would appear that most of the money to be made from investing in property there has already been made. Okay there are examples which defy the trend and people still turn up the odd diamond, but on the whole investment in UK property should now be looked at in the long term, rather than the short or even medium term. Spanish property investment however, is still turning up diamond studded property bargains.

Spain should not be overlooked when comparing investment property for sale outside of the UK. Countries such as Bulgaria have been getting good press of late for property bargains, but as in all things and particularly when you are looking to invest in property, you should take the time to look at all aspects of that investment.

Property investment for most of us has become a reality, thanks in part to the ministrations of the Thatcher government and their policies towards property ownership.

Whether it has been for a property to use as a home, or another income stream through buy to rent schemes, millions have invested in property. Now the UK slow down has tempted people to look offshore for investment opportunities.

Property in Spain and other places such as Bulgaria has since then become the focus of people looking to invest money. It has long been said that you can?t loose by investing in bricks and mortar, but as many people found out to their cost in the late 80?s, property investment can go down as well as up. Investing in Bulgaria is becoming attractive, but be careful look at it from both sides.

If you intend to invest in property to provide an income through rentals, will Bulgaria do it for you? The short answer is probably not, the short answer to why not is again fairly easy. How many people do you know would go to Bulgaria for a holiday? The answer to that is, not nearly as many as will jet off to the Spanish Costa?s at every opportunity.

Investing in Spain will immediately become more attractive, because while properties are more expensive, by the same token a similar property will generate more income because the rents are proportionally higher. The better choice for investment property will therefore still remain in Spain.

Property to be purchased as a home will obviously be bought with a different set of values in mind. Here again thought Spain in general and the Costa Blanca in particular will triumph. Why the Costa Blanca? The short answer is, property prices compared to the Costa del Sol are very favourable on the Costa Blanca.

Why the Costa Blanca and not Bulgaria? Due to the high density of UK expats living in the Costa Blanca there is more work, more Spanish speak English so the language is not a major obstacle. The other overriding reason for choosing Spain is that Bulgaria is not in the European Union, which in itself can present major problems concerning property ownership.

Property investment and ownership in Spain is still a good bet and for more information on all things investment and property related, contact Diamond Properties on the Costa Blanca: http://www.diamondproperties-spain.com

Diamond Properties have links with major Spanish banks, investment consultants and many other institutions and the information and help they offer is reliable and of the highest quality.

Thomas James is a freelance writer and has written many articles on the subject of Spanish property investment. He can be contacted at tom@europennewmedia.com and his website is located at http://www.europeannewmedia.com

Writen By : Thomas James

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