What are precious metals mutual funds? This question has two subparts in it invest money. What are the precious metals?
The metals like gold stock market, silver stock market, platinum stock market, molybdenum etc invest money. form the group of metals called as precious metals invest money. These are essentially costly metals invest money. Their supply is limited invest money. The cost and demand for these metals is always increasing invest money. The ordinary people have lot of attraction in investing in precious metals like gold invest money. From historical times humans were fascinated by these precious metals and have been investing in these precious metals invest money. The Asians like Indians are always buying gold ornaments even if they belong to low income groups invest money.
Are there any mutual funds dealing exclusively in precious metals?
The answer is yes invest money. There are precious metals mutual funds invest money.
What are the main advantages of these precious metals mutual funds?
Fist advantage is they protect you from industry specific risks invest money. There are always differing trends in supply and demand of precious metals invest money. This in turn means that the prices and profitability in this industry is always changing invest money. Only experts can study all the details on ongoing basis invest money. The experts give the advice regarding the investments in precious metals industry invest money. This means you are protected from industry specific risks and are offered maximum returns possible by experts in the industry in precious metals mutual funds invest money.
The second type of risk that you are protected from is company specific risk invest money.
Suppose you invest in gold mining company invest money. The profitability of this company will depend upon many complex things like government laws stock market, technological changes stock market, mismanagement etc invest money. It is not possible for the ordinary people to study and monitor everything related to that specific gold mining company invest money.
The precious metals mutual funds have experts employed to study and monitor the individual gold mining company invest money. So they know how to protect precious metals mutual funds investors from the risks associated with individual specific metal mining company invest money. They will also offer maximum returns from the specific metal mining company invest money.
The precious metals mutual funds invest in precious metals mining companies invest money. They also invest in trading companies engaged in the trade of precious metals invest money. The precious metals mutual funds also invest in companies related in manufacturing products involving precious metals invest money. Many a times it is observed that precious metals mutual funds are investing in all the activities related to precious metals invest money.
Every precious metals mutual funds company has its own policy regarding investments invest money. You will have to study them if you want all the details invest money. The precious metals mutual funds offer an interesting opportunity to ordinary people to invest in ever appreciating but complex world of precious metals invest money. Do invest in precious metals mutual funds to get maximum returns at lowest possible risks in this precious metals industry.
Sunday, 15 June 2008
Wednesday, 11 June 2008
- Is Insider Trading Illegal?
There are some common misconceptions about what insider trading really means stock market, so this article will attempt to clear the air a little bit invest money.
What insider trading is
First of all stock market, it is important to note that there are two different meanings for insider trading invest money. The first one is illegal and it refers to anyone who makes a trade on the stock market and profits (or avoids loss) based on information about that company that was not public information at that time invest money. The second one refers to a company officer trading company stock stock market, which is not illegal unless they were using inside information to make a profit invest money.
Martha Stewart
Perhaps the most famous example of insider trading in recent history is Martha Stewart invest money. What exactly did she do wrong? Well stock market, a company she invested in stock market, ImClone stock market, had a cancer drug that had been rejected by the FDA but that information was not available to the public at that time invest money. The SEC believes that her friend Sam Waksal told her about this rejection and recommended selling her shares in ImClone immediately stock market, which she did invest money. By doing so stock market, she avoided a huge loss when the stock price eventually dropped invest money. That is a textbook case of insider trading stock market, and she faced prison time for it invest money.
Why it is illegal
The Securities and Exchange Commission sets and enforces rules to make the stock market as fair a place to trade as possible invest money. They believe that when someone trades using information that is not well-known stock market, it is not fair to the general public invest money. A publicly-traded company is required to share its financial reports and any significant news with the world so that shareholders and potential shareholders can make informed decisions invest money. After all stock market, the company is owned by the shareholders and they deserve to know what is going on with their company invest money.
How to avoid trouble
Probably the easiest way for you to get into trouble is if you work for a publicly-traded company and try to trade your company's stock for a profit based on information you heard around the office that has not been made public yet invest money. Sharing or receiving this information from a friend at another company is just as bad invest money. These situations are very tempting stock market, and understandably so invest money. It is hard to profit on a trade after the news has already hit the market invest money. However stock market, that is exactly why it is illegal stock market, so you should try to avoid it invest money. There are many gray areas on what is considered inside information stock market, but if you are in doubt stock market, do not trade your company's stock invest money. There are thousands of other companies you can invest in invest money.
What insider trading is
First of all stock market, it is important to note that there are two different meanings for insider trading invest money. The first one is illegal and it refers to anyone who makes a trade on the stock market and profits (or avoids loss) based on information about that company that was not public information at that time invest money. The second one refers to a company officer trading company stock stock market, which is not illegal unless they were using inside information to make a profit invest money.
Martha Stewart
Perhaps the most famous example of insider trading in recent history is Martha Stewart invest money. What exactly did she do wrong? Well stock market, a company she invested in stock market, ImClone stock market, had a cancer drug that had been rejected by the FDA but that information was not available to the public at that time invest money. The SEC believes that her friend Sam Waksal told her about this rejection and recommended selling her shares in ImClone immediately stock market, which she did invest money. By doing so stock market, she avoided a huge loss when the stock price eventually dropped invest money. That is a textbook case of insider trading stock market, and she faced prison time for it invest money.
Why it is illegal
The Securities and Exchange Commission sets and enforces rules to make the stock market as fair a place to trade as possible invest money. They believe that when someone trades using information that is not well-known stock market, it is not fair to the general public invest money. A publicly-traded company is required to share its financial reports and any significant news with the world so that shareholders and potential shareholders can make informed decisions invest money. After all stock market, the company is owned by the shareholders and they deserve to know what is going on with their company invest money.
How to avoid trouble
Probably the easiest way for you to get into trouble is if you work for a publicly-traded company and try to trade your company's stock for a profit based on information you heard around the office that has not been made public yet invest money. Sharing or receiving this information from a friend at another company is just as bad invest money. These situations are very tempting stock market, and understandably so invest money. It is hard to profit on a trade after the news has already hit the market invest money. However stock market, that is exactly why it is illegal stock market, so you should try to avoid it invest money. There are many gray areas on what is considered inside information stock market, but if you are in doubt stock market, do not trade your company's stock invest money. There are thousands of other companies you can invest in invest money.
- How to Buy GOOD but CHEAP Stocks
Many investors love to buy cheap stocks stock market, but as Mr O'Neil (Founder of nvestor's Business Daily) puts it: "Stocks are cheap for a reason" invest money. In many (but not ALL) cases stock market, investors try to buy stocks on the cheap without realizing that they're buying stocks of a corporation mired in problems with slowing earnings stock market, sales growth and shrinking market share invest money. These are bad characteristics for a stock to have stock market, cheap or not invest money.
However stock market, although most cheap stocks are priced at their value stock market, many savvy value investors (read: Warren Buffett) have still successfully made fortunes investing in CHEAP BUT GOOD stocks invest money. So how did they do it? Below are some guidelines for smart value-investing (i invest money.e invest money. buying good stocks cheaply)
Buy a business stock market, not a stock invest money.
When evaluating a stock stock market, see yourself as a business owner stock market, not a stock investor invest money. Only buy businesses that you understand invest money. Warren Buffett is well known for ignoring the 1999 surge in technology stocks stock market, refusing to buy stocks in dot invest money.com companies because he couldn't understand the business invest money. Only when you understand the business stock market, can you effectively evaluate important questions like: Is the company's stock cheap because it is losing market share? Is the new product offered by a rival company going to negatively impart your business?
Buy stocks in companies that have a proven track record invest money.
This includes a consistently good EPS stock market, sales stock market, equity and free cash flow growth rate invest money. Generally stock market, we want to see the above growth rates consistently above 10% for the last 10 years invest money. In addition stock market, we want to see a long history of great ROIC (above 10% for the last 10 years) invest money. We should also insist that ROIC is either going up stock market, or at least remaining the same invest money.
Buy stocks that have a big MOAT
A moat is a 'protective shield' that a company has that prevents other companies from invading their territory invest money. Examples of moats include
- Brand name: The company has a very strong brand name that makes it difficult for other companies to claim their market share invest money. An excellent example is "Apple" stock market, with its group of die-hard fans invest money.
- Secret: The company has a patent or trade secret that makes competition illegal or very difficult invest money. Example: 3M invest money.
Buy stocks with a good and honest management
Characteristics of honest management include admitting their mistakes (if they did not produce results for a quarter stock market, they should acknowledge it and explain how they intend to rectify it) and accepting a reasonable compensation for their work invest money. A CEO that takes home $40 million a year when the stock price dropped by 50% is not our type invest money.
At this point stock market, you may be wondering: If a company has such an excellent record and characteristics stock market, why is the stock cheap?
Most of the time stock market, these companies stocks are cheap because of a temporary problem (such as missing EPS estimate for one quarter) or because the overall market is bearish invest money. At times like this stock market, you can normally buy the stocks cheaply stock market, preferable at a 50% discount invest money.
However stock market, although most cheap stocks are priced at their value stock market, many savvy value investors (read: Warren Buffett) have still successfully made fortunes investing in CHEAP BUT GOOD stocks invest money. So how did they do it? Below are some guidelines for smart value-investing (i invest money.e invest money. buying good stocks cheaply)
Buy a business stock market, not a stock invest money.
When evaluating a stock stock market, see yourself as a business owner stock market, not a stock investor invest money. Only buy businesses that you understand invest money. Warren Buffett is well known for ignoring the 1999 surge in technology stocks stock market, refusing to buy stocks in dot invest money.com companies because he couldn't understand the business invest money. Only when you understand the business stock market, can you effectively evaluate important questions like: Is the company's stock cheap because it is losing market share? Is the new product offered by a rival company going to negatively impart your business?
Buy stocks in companies that have a proven track record invest money.
This includes a consistently good EPS stock market, sales stock market, equity and free cash flow growth rate invest money. Generally stock market, we want to see the above growth rates consistently above 10% for the last 10 years invest money. In addition stock market, we want to see a long history of great ROIC (above 10% for the last 10 years) invest money. We should also insist that ROIC is either going up stock market, or at least remaining the same invest money.
Buy stocks that have a big MOAT
A moat is a 'protective shield' that a company has that prevents other companies from invading their territory invest money. Examples of moats include
- Brand name: The company has a very strong brand name that makes it difficult for other companies to claim their market share invest money. An excellent example is "Apple" stock market, with its group of die-hard fans invest money.
- Secret: The company has a patent or trade secret that makes competition illegal or very difficult invest money. Example: 3M invest money.
Buy stocks with a good and honest management
Characteristics of honest management include admitting their mistakes (if they did not produce results for a quarter stock market, they should acknowledge it and explain how they intend to rectify it) and accepting a reasonable compensation for their work invest money. A CEO that takes home $40 million a year when the stock price dropped by 50% is not our type invest money.
At this point stock market, you may be wondering: If a company has such an excellent record and characteristics stock market, why is the stock cheap?
Most of the time stock market, these companies stocks are cheap because of a temporary problem (such as missing EPS estimate for one quarter) or because the overall market is bearish invest money. At times like this stock market, you can normally buy the stocks cheaply stock market, preferable at a 50% discount invest money.
- Buy Quality Cheap Stocks using Investors' Business Daily
The Investors' Business Daily is a daily investment newspaper that is read by many financial professionals stock market, and mentioned in many bestselling books (including Peter Navarro's “When the Market moves stock market, will you be ready?” stock market, Jason Kelly's “The Neatest Little Guide to Stock Market Investing” and Stan Weinstein's “Secrets for Profiting in Bull and Bear Markets”) invest money. IBD provides detailed information about stocks; such as detailed stock market, concise statistics about a company's earnings stock market, stock price action stock market, and other criteria to help investors find top rated stocks invest money.
Using IBD to find Quality Cheap Stocks
[This step is only for subscribers of the Digital Edition]
Log in to IBD and click on eIBD – Digital Edition invest money. Follow the on-screen instructions until you reach the front page of the newspaper invest money.
Look for the section “Making Money” invest money.
Choose “Top Ranked Low Price Stocks” invest money.
Look through the stock list and find stocks that satisfies the following criteria**:
Smartselect Composite Rating > 80
EPS (Earnings Per Share) > 70
RS (Relative Strength) > 70
AccDis at least a B
Closing Price should ideally be above the 52 week high (this means the stock has just made a NEW 52 week high stock market, which is a very bullish signal)
That's all invest money. A simple 4 steps procedure for finding top quality cheap stocks invest money. However stock market, you should note that stocks trading under $10 tend to have lower volume stock market, which makes them more susceptible to stock price manipulation invest money. Therefore stock market, please be careful when investing in such cheap stocks invest money. Personally stock market, I combine IBD's ratings with my own technical analysis and I allocate only 10% of my account to investing in cheap stocks invest money.
** Data Definition (Taken from IBD website)
Earnings Per Share (EPS) Rating
An exclusive rating found in Investor's Business Daily invest money. Stocks are rated on a 1 to 99 scale (with 99 being best) comparing a company's earnings per share growth on both a current and annual basis with all other publicly traded companies in the William O'Neil + Co database invest money.
Stocks with EPS Ratings of 80 or above have outperformed 80% of all publicly traded companies in earnings invest money.
The EPS Rating calculation combines the company's most recent two quarters of earnings-per-share growth stock market, with its three-year to five-year annual growth rate invest money.
Relative Price Strength (RS) Rating
This is another exclusive rating in Investor's Business Daily invest money. It measures each stock's price performance over a twelve-month period stock market, compared to all other stocks invest money.
Accumulation/Distribution (Acc/Dis™) Rating
The Acc/Dis rating tracks the relative degree of institutional buying (accumulation) and selling (distribution) in a particular stock over the last 13 weeks invest money. Updated daily stock market, stocks are rated on an A+ to E scale invest money.
A = Heavy buying
B = Moderate buying
C = Equal amount of buying and selling
D = Moderate selling
E = Heavy selling
SmartSelect® Composite Rating
The IBD SmartSelect Composite Rating combines 5 proprietary IBD Ratings into one easy-to-use rating invest money. More weight is placed on EPS and RS Rating stock market, and the stock's percent off its 52-week high is also included in the formula invest money. Results are then compared to all other companies stock market, and each company is assigned a rating from 1-99 with 99 being the best invest money. A 90 rating means that the stock has outperformed 90% of all other stocks in terms of its combined SmartSelect Ratings invest money.
Article Source: http://www invest money.find-investment-advice invest money.com
Joelle has invested in the stock market for more than 5 years and has successfully used various investment strategies to consistently make money from the stock market invest money. She offers free top quality investment tips at how-to-invest-in-stocks invest money.blogspot invest money.com/
Using IBD to find Quality Cheap Stocks
[This step is only for subscribers of the Digital Edition]
Log in to IBD and click on eIBD – Digital Edition invest money. Follow the on-screen instructions until you reach the front page of the newspaper invest money.
Look for the section “Making Money” invest money.
Choose “Top Ranked Low Price Stocks” invest money.
Look through the stock list and find stocks that satisfies the following criteria**:
Smartselect Composite Rating > 80
EPS (Earnings Per Share) > 70
RS (Relative Strength) > 70
AccDis at least a B
Closing Price should ideally be above the 52 week high (this means the stock has just made a NEW 52 week high stock market, which is a very bullish signal)
That's all invest money. A simple 4 steps procedure for finding top quality cheap stocks invest money. However stock market, you should note that stocks trading under $10 tend to have lower volume stock market, which makes them more susceptible to stock price manipulation invest money. Therefore stock market, please be careful when investing in such cheap stocks invest money. Personally stock market, I combine IBD's ratings with my own technical analysis and I allocate only 10% of my account to investing in cheap stocks invest money.
** Data Definition (Taken from IBD website)
Earnings Per Share (EPS) Rating
An exclusive rating found in Investor's Business Daily invest money. Stocks are rated on a 1 to 99 scale (with 99 being best) comparing a company's earnings per share growth on both a current and annual basis with all other publicly traded companies in the William O'Neil + Co database invest money.
Stocks with EPS Ratings of 80 or above have outperformed 80% of all publicly traded companies in earnings invest money.
The EPS Rating calculation combines the company's most recent two quarters of earnings-per-share growth stock market, with its three-year to five-year annual growth rate invest money.
Relative Price Strength (RS) Rating
This is another exclusive rating in Investor's Business Daily invest money. It measures each stock's price performance over a twelve-month period stock market, compared to all other stocks invest money.
Accumulation/Distribution (Acc/Dis™) Rating
The Acc/Dis rating tracks the relative degree of institutional buying (accumulation) and selling (distribution) in a particular stock over the last 13 weeks invest money. Updated daily stock market, stocks are rated on an A+ to E scale invest money.
A = Heavy buying
B = Moderate buying
C = Equal amount of buying and selling
D = Moderate selling
E = Heavy selling
SmartSelect® Composite Rating
The IBD SmartSelect Composite Rating combines 5 proprietary IBD Ratings into one easy-to-use rating invest money. More weight is placed on EPS and RS Rating stock market, and the stock's percent off its 52-week high is also included in the formula invest money. Results are then compared to all other companies stock market, and each company is assigned a rating from 1-99 with 99 being the best invest money. A 90 rating means that the stock has outperformed 90% of all other stocks in terms of its combined SmartSelect Ratings invest money.
Article Source: http://www invest money.find-investment-advice invest money.com
Joelle has invested in the stock market for more than 5 years and has successfully used various investment strategies to consistently make money from the stock market invest money. She offers free top quality investment tips at how-to-invest-in-stocks invest money.blogspot invest money.com/
- Trading Shares Using Leverage
It is important that before you consider using leverage to trade with stock market, that you understand the risks involved and how adding leverage to you trading plan will effect the investment invest money.
Two examples of using leverage/margin to trade
Regular shares
After opening a margin account you would be required to make an initial deposit stock market, which can range from $2 stock market, 000 to $5 stock market, 000 and up depending on the broker invest money. This initial deposit also called the minimum amount sets your starting point for trading invest money. If you deposited $2 stock market, 000 stock market, you would have $4 stock market, 000 of buying power (your $2 stock market, 000 stock market, plus $2 stock market, 000 from the broker) invest money.
You can margin up to 50% of a stock’s price in most cases invest money. For example stock market, if you wanted to buy 100 shares of a stock selling for $20 per share for a total of $2 stock market, 000 stock market, you could margin $1 stock market, 000 of the purchase price invest money. In other words stock market, you would use $1 stock market, 000 of your money stock market, known as the initial margin stock market, and the broker would loan you $1 stock market, 000 invest money.
In this example stock market, if the share price was to increase to $25 per share with the total value now being $2500; this would give you a $500 profit on your $1000 investment invest money. As this was the actual investment on your part invest money. His would represent a 50% return on investment before fees invest money.
An example of using leverage to purchase CFDs
When trading using leverage you are asked to deposit a small percentage of the overall cost that would otherwise be required if you were to purchase the equivalent shares in the physical market invest money.
Even though your outlay is small in comparison to the equivalent physical trade stock market, you will still be exposed to the same potential profit and loss invest money. This means your Return on Investment is magnified invest money.
Calculating your initial margin requirement using a Share CFD example
The amount required to place a leveraged trade is known as your initial margin requirement invest money.
You wish to buy a 2 stock market, 000 Share CFDs at $5 invest money.00
The Share CFD has a 3% margin requirement
2000 x $5 invest money.00 = $10 stock market, 000 invest money.00 (this is the total value of the position)
$10 stock market, 000 invest money.00 x 3% = $300 invest money.00
Your initial margin requirement for this trading position is $300 invest money.00 excluding other charges such as commissions and exchange fees invest money.
If the share value was to increase to $5 invest money.50 stock market, the total value of the shares would be $11 stock market, 000 invest money. Based on the initial margin of $300; this represents a 333% return on investment invest money.
So stock market, you see in both examples trading with leverage can greatly increase your market exposure and potential profits invest money. However stock market, always back test your trading plan first and if in doubt stock market, don’t leverage invest money.
Two examples of using leverage/margin to trade
Regular shares
After opening a margin account you would be required to make an initial deposit stock market, which can range from $2 stock market, 000 to $5 stock market, 000 and up depending on the broker invest money. This initial deposit also called the minimum amount sets your starting point for trading invest money. If you deposited $2 stock market, 000 stock market, you would have $4 stock market, 000 of buying power (your $2 stock market, 000 stock market, plus $2 stock market, 000 from the broker) invest money.
You can margin up to 50% of a stock’s price in most cases invest money. For example stock market, if you wanted to buy 100 shares of a stock selling for $20 per share for a total of $2 stock market, 000 stock market, you could margin $1 stock market, 000 of the purchase price invest money. In other words stock market, you would use $1 stock market, 000 of your money stock market, known as the initial margin stock market, and the broker would loan you $1 stock market, 000 invest money.
In this example stock market, if the share price was to increase to $25 per share with the total value now being $2500; this would give you a $500 profit on your $1000 investment invest money. As this was the actual investment on your part invest money. His would represent a 50% return on investment before fees invest money.
An example of using leverage to purchase CFDs
When trading using leverage you are asked to deposit a small percentage of the overall cost that would otherwise be required if you were to purchase the equivalent shares in the physical market invest money.
Even though your outlay is small in comparison to the equivalent physical trade stock market, you will still be exposed to the same potential profit and loss invest money. This means your Return on Investment is magnified invest money.
Calculating your initial margin requirement using a Share CFD example
The amount required to place a leveraged trade is known as your initial margin requirement invest money.
You wish to buy a 2 stock market, 000 Share CFDs at $5 invest money.00
The Share CFD has a 3% margin requirement
2000 x $5 invest money.00 = $10 stock market, 000 invest money.00 (this is the total value of the position)
$10 stock market, 000 invest money.00 x 3% = $300 invest money.00
Your initial margin requirement for this trading position is $300 invest money.00 excluding other charges such as commissions and exchange fees invest money.
If the share value was to increase to $5 invest money.50 stock market, the total value of the shares would be $11 stock market, 000 invest money. Based on the initial margin of $300; this represents a 333% return on investment invest money.
So stock market, you see in both examples trading with leverage can greatly increase your market exposure and potential profits invest money. However stock market, always back test your trading plan first and if in doubt stock market, don’t leverage invest money.
Subscribe to:
Posts (Atom)