Tag Archives: investing

Investing In Alternative Energy Funds – Investment Research

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If you are like me, then you are constantly on the look out for a good investment.  Market research is the key to finding sound investments.  Even with diligent research, sometimes we miss out on great investment opportunities.  There is an emerging market sector that might provide future gains – alternative energy.

Alternative energy is basically any energy source other than fossil fuels.  We all know that fossil fuels are a limited resource, and will one day run out.  Although we still have many projected decades of fossil fuel reserves, development into alternative energy sources has been increasing in the past decade.  This is due to a few variables.  First of all, there is a growing concern over the price of fossil fuels.  Gas and utility costs are soaring.  This additional burden on everyone who is dependent on fossil fuels is felt everywhere.  Supply shortages and middle eastern turmoil mixed with an increasing world demand is the cause of the price spike.  Public sentiment is also not favorable of fossil fuels.  With the recent BP oil tragedy, more and more people are in support of cleaner, renewable energy sources.

Because of the trending away from fossil fuels towards renewable energy sources, such as solar and wind power, companies are pouring more and more money into research and development.  These are the companies that might strike a breakthrough.  Right now, most alternative energy sources are still more costly than fossil fuels, so as technology increases, prices will come down, making alternative energy more widely available.  These companies are the ones to watch.

Investing in alternative energy funds is a matter of research.  Some may find alternative energy mutual fundsto be a safe investment.  Others might like to take on more risk, which individual stocks and ETFs can provide.  Whatever type of investment you like, make sure to do your homework.

Forex Trading Scams | Guide to Not Getting Scammed

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There are many advertisements about forex trading tricks that will make you money.  It seems easy, because they make it sound like it’s easy.  It also seems like you can repeat is over and over to make you small amounts and have it add up.  Here is a guideline to help you think through forex trading scams and to figure out which ones are legitimate.

There are many forex trading strategies that are being marketed out there.  It’s hard to know which ones are legitimate and which ones aren’t.  The first rule is, if they guarantee returns, they are probably a forex trading scam.

The reality is that no one can guarantee returns on the forex market.  It’s one of the most risky markets in the world.  Even brilliant currency traders can’t guarantee returns.  So if they do, I would run the other way.

The next red flag is when it seems really easy and all you have to do is rinse and repeat.  Here is the reality.  If there was some easy trick to make millions on the forex market guaranteed, they would not be selling it to you.  Instead, they would probably be using it to make money for themselves.

If they make so much money from that forex trading strategy, why would they spend the time and energy trying to sell it to you?  They would only do that if they really weren’t making money from it.

If they were, they would be spending their precious time making money from their trick.  They would also be trying to raise forex investment money to leverage their trading.  If it was such a sure thing, there would be investors climbing over each other to invest in such a fund.

These are some of the things you want to think through to determine if something is a forex trading scam.  Remember, if it’s too good to be true, it probably is.

Value Investing Is Smart and Beats Growth Investing

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Recent research has found that growth investors actually faired worse over time than value investors.  In essence, value investing ironically resulted in more growth than growth investing.  There is a simple reason for that.  Value investing goes from the fundamentals up to the market price.  Growth either goes in the opposition direction or actually never goes there at all.

There is a reason why ultra successful investors like Warren Buffett find value investing to be the best investment strategy in the world.  The great news is that you don’t have to be a genius to be one.

Value investing starts with a critical and fundamental analysis of the company itself.  At the starting point, you are completely blind to what the shares are trading for or how fast it has been or not been growing in the last 52 weeks.

You look at their financial statements and make sure they are solid and without any major anomalies.  You also look at their business model and make sure that it is solid against competitors.  You need to make sure they are well positioned to outpaced their competition for the next little while.  You also want to take a glance at the market they are going after.  See if it’s been saturated or it’s growing with room for more business.

Then you have to make a valuation call on the business.  That’s not easy to do, especially for a retail investor.  There are many easy models to follow that will give you a good sense of how much a company should be worth.  I say ‘should’ because sometimes it will not match the market’s valuation.

Then you go look at the market price of the company.  Here’s a quick stock market basics lesson on finding out the value: you look at the market cap.  I won’t go into how to calculate it right now, but you can use any stock screener to find these values.  If your valuation is higher than the market cap by 20% or more, than you may have a winner.  That is how you do value investing.

Bonds and Their Types

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Bonds have been considered all across traders from around the world as safe investments which yield satisfying returns.  Four types of bonds are available.  Investing in them assures the investor that his or her initial investment will surely be returned, with profit.  This makes bonds ideal for new investors, and safe for people who are new to investing.  Bonds are sold through local and state governments and corporations.  The United States Government makes treasury bonds available through the Treasury Department and also provides people with free investment software.  Maturity dates ranging from 3 months to as long as thirty years are available.

The four types of bonds are treasury bonds, corporate bonds, state and local government bonds, and foreign bonds.  Treasury bonds include treasury bills, treasury notes, and treasury bonds, which are backed by the US government and taxes are only charged on the interest that the bonds earn.  State and local government bonds have higher interest rates, but taxes are waived.  Corporate bonds meanwhile are available through public security markets.  These bonds are companies’ debts that are sold.  They are quite risky, depending on the company that offers it.  Lastly, foreign bonds can be purchased as part of a mutual fund.  They are also risky, so it is better to stick to US government bonds.

The Good Deal with Forex Trading Courses

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Forex trading courses are without a doubt a sure way of putting one’s self on the successful road of forex trading given that it provides one with the right skills that one will need in order to win and at the same time cut one’s learning time therefore saving lots of time. As a matter of fact, experts consider it to be a proven strategy that can surely grant one with the most sought after success.

Usually forex trading courses cost quite some money. Then again it is worth the small price as it will surely last for a lifetime. A good thing about these courses is that anyone can learn from it, just like they can learn from just like they can learn from the simulators in many forex free software trading programs. Moreover it only requires a small amount of effort as it is easy to understand. Also with these forex trading courses, one will be provided with not just skills but also strategies that are a sure hit.

Efficient Market Hypothesis and Global Macro

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Is the efficient market hypothesis a legitimate concept?  After years of existence has it proven itself correct or not?  Or has it proven itself to be utter crap?  As you can probably guess from the last question we think that it is crap.  The efficient market hypothesis or EMH states that all the information that can be used is already in the market and that practitioners can not beat the market over a long period of time.

Well guess what?  There are several groups of investors that have done exactly that.  Some use well known info and other go out of their way to find pockets of lesser known info but they  can and do beat the market on a regular basis.  Value investors have long been thought of as a group that trounces the market averages over full market cycle.  A lesser known group that has had even more success is that of the global macro traders.  As a group they have been the best performing hedge fund style since at least 1994 when the first database started to track this data.  They beat value, long short equity, etc. in the quest for superior gains.  And they did all of this with less then market risk.

Trading Options for Individual Investors During Earnings Report

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There are times that companies would pre-announce their estimates weeks and sometimes even months before the actual earnings report. These announcements are helpful in the sense that they give a sense of warning or reassurance to the investing public. At the same time, investment analysts would also have an idea about the things to expect for the earnings report. This lessens the shock for the possibility of having bad news for the value of the stocks. While there are people who would like to play it safe and buy only after the earnings report, savvy investors know that it is also sometimes better to buy even before the earnings report comes. There are a number of trading options around earnings reports. For instance, earning systems of traders are according to the earnings report.

The key to this is not to be rash. This means that earnings traders have to be patient and wait for the impact on the market first before making any move. They should not buy stocks right away and they should not take every stock they can buy. The difficulty is when to exit the trading system. There are times that pre-earnings reports are more or less accurate but they will not be carried on to the actual earnings reports, some programs can compare this information and to learn more about that just read some trading software reviews. Some newbies in the field of investing tend to buy according to them exactly as is. Oftentimes, the problem comes with the over-reaction of traders and analysts. People have to use pre earnings announcement as a guide because it can still balloon into a bigger loss or a bigger profit.

People can also choose to hold onto the stocks through the earnings reports especially in the case of bigger companies that have already proven themselves.