Minggu, 31 Oktober 2010

Better Trades Momentum Part 2

In Part I of this article, I taught you to trade momentum that occurs after an earnings announcement. In this article, I am going to go into some of the chart patterns we can use to trade momentum that is unrelated to earnings or news. And in Momentum Part III, I will show you how to combine news and chart patterns to trade momentum. But, before I get too far ahead of myself, let me recap what momentum is and why I trade it.

I love to trade options on stocks with a lot of momentum. What this means is that I want to trade those stocks, Exchange Traded Funds or Indexes that are moving fast and far. The way I see it, if I am going to put my money in the market, I want to place it where it will work as hard as possible for me. You may have attended my free webshop on Monster Momentum plays during which I introduced a couple of the technical tools that I use to find and trade this strategy, but let me show you today some other pieces to this strategy and how this can be a boost to your trading account.

The first step to trading momentum is that you need to find a stock that has the capability to move fast and far. These stocks generally have a dollar to two dollar average daily range during normal trading. Once the momentum picks up, they can trend twenty to thirty points or so in a matter of a few months. Sometimes this momentum is sparked by news announcements such as earnings or a new drug approval and sometimes it is just a stock that becomes heavily bought or sold by institutions. Whatever the case, once you learn to read technicals, you will be able to spot the building momentum in time to profit from the big move.

Many of my most profitable momentum trades took place not because of any news but just because the chart began to show signs of big buying pressure or big selling pressure. I look for things like breakouts, long candle bodies, and various candle patterns combined with the six indicators I use to signal a momentum trade. The best way I can teach you to trade momentum is to show you some of the patterns that I and others in my Traders’ Talks have recently traded.

The first thing to keep in mind with momentum is that once a stock has made a big momentum move, you know it has the ability to do it again in the future. It will probably take a breather for a while and it may not move in the same direction, but the momentum will almost always pick up once again.

Take Goldman Sachs (GS) for instance. This stock ran with a lot of momentum from $155 to about $205 before it started trading sideways.

If you had been to my Technically Speaking classes or in my Traders’ Talks you would have traded GS all the way up through that run. But at the end of the run, Goldman took a breather for almost a month while it traded in a sideways range between $198 and $203. During this sideways movement, I put my money in other stocks and ETF’s that were moving with more momentum. Don’t forget what I mentioned earlier, that stocks that have moved with momentum in the past will almost always move with momentum again. So when a momentum stock slows down make sure you are ready to trade it once it begins to move again.

I find momentum trades from my Momentum Scans (you can learn more about these in the Ultimate Scans free webshop), and on January 8th GS showed up on my Momentum Scan as the stock started moving toward that resistance level. By the time it had rallied through the $203 resistance level I had entered a bullish trade. There is no trade that is more fun than a momentum trade. When all the technicals are bullish and my momentum entry was hit, all I had to do was kick back and watch the buying pressure drive this stock up to almost $214 where it sits at the time I write this article. You can see how profitable these breakouts can be on momentum stocks. Goldman has run more than $11 in only five days!

Intercontinental Exchange (ICE) is another momentum stock that we traded in the past as it ran from $68 to $113. That move took nearly three months and then ICE began to slow down and consolidate. The stock was not attracting enough buying pressure to push it through $110. That resistance became an important price target for the stock. If buyers came back willing to pay higher prices for ICE the stock would rally above the $110 resistance and mark our next momentum entry.

You can see below that ICE broke out on January 3rd , prompting a bullish momentum entry. The stock then rallied to a high of $137 giving us a gain of 27 points in seven days.

ICE and GS are just two examples of the many momentum trades out there. I have shown you a couple important technicals pieces that need to be present to make this strategy work. Make sure the stock has the ability to move at least a dollar or two every day and then look at the price chart to see if the stock has moved with momentum before. Then wait for a breakout from a consolidation area to give you one of the safest, easiest and most profitable entries into the momentum trade. And remember, you may have missed these trades, but there are plenty more momentum trades to come. Learn to read momentum signals in a price chart with my six indicators adding confirmation and you will be prepared to catch the next big momentum trade

Hope to see you soon!

Markay Latimer with Better Trades

Sabtu, 30 Oktober 2010

Better Trades Momentum Part 1

I love to trade options on stocks with a lot of momentum. What this means is that I want to trade those stocks, Exchange Traded Funds or Indexes, that are moving fast and far. The way I see it, if I am going to put my money in the market, I want to place it where it will work as hard as possible for me. You may have attended my free webshop on Monster Momentum plays during which I introduce a couple of the technical tools that I use to find and trade this strategy, but let me show you today some other pieces to this strategy, and how this can be a boost to your trading account.

The first step to trading momentum is that you need to find a stock that has the capability to move fast and far. These stocks generally have a dollar to two dollar average daily range during normal trading. Once the momentum picks up they can trend twenty to thirty points or so in a matter of a few months. Sometimes this momentum is sparked by news announcements such as earnings or a new drug approval, and sometimes it is just a stock that becomes heavily bought or sold by institutions. Whatever the case, once you learn to read technicals, you will be able to spot the building momentum in time to profit from the big move. As we are heading into the thick of earnings season, this article will show you some ways to trade the post earnings momentum. Watch for part II of this article to learn more about other technical momentum plays.

Holding a directional trade over earnings can be risky, but after the release the uncertainty of what direction the stock will move is gone. I like to trade after earnings because we often have an unusually large amount of trading activity that moves many stocks faster and further than they would normally go. It may be that earnings numbers were a big surprise, (they might be much stronger or weaker than expected) or it may be that traders were waiting to see what the quarter was like before they put more money into or took money out of the stock. It truly does not matter what the actual number are, mind you, because we are not trading the numbers, we are trading the reaction to the numbers. Checking a chart the evening after a company announces will show us if we have tradable momentum. If there is a great amount of buying pressure, I trade it up and if I see a lot of selling pressure, I trade it down.

One of my more favorite post earnings plays is Goldman Sachs (GS). In fact, this trade has worked out extremely well on Goldman a couple times already this year. HINT: this is a stock to watch the next time they release earnings!

Goldman Sachs announced earnings in September and gapped up above resistance. In my Technically Speaking workshops, I will show you how to use an intraday chart to trade on the first day after news is released, but for the purposes of this article I would like to teach you how to make money on this strategy even if you do not have the time to watch the intraday chart. To do this, you need to recognize momentum as it develops on a daily chart. Many momentum plays begin like GS did, as a breakout. Goldman formed a bullish Opening Marubozu candle September 19th after the earnings release. The stock closed that day above a previous $155 resistance level. A close above resistance should be viewed as a strong signal for the stock. After such a signal, I confirm with my indicators (for more information on the technicals I use, join me in one of my live Technically Speaking workshops or watch the class on DVD). I am trying to find any excuse to stay out of the trade. Any bearish indicator or bearish price pattern will prevent me from entering the trade. But, if all technicals confirm a bullish trade I enter the following day. One note of caution here: news may only have enough influence to move the stock for one day. Because of this, I prefer to enter my trades above the high (or the low if it dropped) of the day the news is announced.

Using this technique, Goldman got us into a post earnings momentum trade around $159.75. The price graph and the indicators I teach you to use were all bullish so we had the OK to enter a trade that day. Once our entry in this type of trade is triggered, you want to stay in as long as there is continued buying pressure. Often the buying pressure and momentum will move a stock for only three to five days. In the case of Goldman, the stock had post earnings momentum for three days but it barely took a breather on days four thru six before gapping up and taking off once again. The technicals have remained strong enough to keep providing bullish trades for the past couple months for a run from $159.75 to $186 where the stock is currently trading at the time this article was written. These momentum plays can be traded as one trade that you will stay in as long as you have enough time in your option or as something you can position in and out of to pull profits out along the trend.

The entry on this type of trade can feel risky because of the gap. The danger with gaps is that all the trade may be taken in the gap and there may not be enough buying or selling pressure to move the stock further. For example, when the Chicago Mercantile Exchange (CME) announced they were buying CBOT Holdings (BOT), the CME gapped to an all time high. The opening price was over ten points above the long day candle you see earlier that month.

After the open, no one was willing to pay a higher price for the CME and the stock dropped like a rock. When a stock gaps beyond a price at which it was comfortable trading, you can rest assured that much of that play was taken in the gap and the safest way to trade it may be to trade the retracement. One thing you can do to make trading a gap on news more safe is to avoid the trade unless the gap puts the stock near its recent trading range. In the case of CME, the stock was so far above where traders were comfortable buying it that people took profits out very quickly. With Goldman, just the opposite was true. Because it gapped to $155, a price that people had paid for the stock many times in August, traders were much more comfortable piling in at that price after earnings. All the buyers willing to pay $155 or more for GS helped push it much higher.

A news announcement such as earnings can present wonderful trades. The momentum associated with the news may create a lot of buzz around the stock and draw more buyers into the stock, or motivate people to sell the stock in droves. Either way we can trade it. Check the technicals first to make sure everything is bullish before buying calls or that everything is bearish before buying puts. And remember that as long as the stock gaps to a price that is has traded recently, there may be plenty of room left for the stock to move. Enter the trade and manage your risk by placing your stop. This is one easy way to build your account up trading momentum during earnings season.

Hope to see you soon!

by Markay Latimer with Better Trades

Jumat, 29 Oktober 2010

Better Trades Inc

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Everyone would love to be able to make money on the stock market, and whether your ambition is to learn about trading for your own personal gain or to work toward becoming a professional trader, BetterTrades can help you turn your goal into a reality.  BetterTrades has already helped hundreds of people learn more about trading, giving them the details and the inside information to become stronger, more successful traders.

If you would like to join this educational experience, all you have to do is sign up. The registration process for BetterTrades is fast and easy, and it grants you instant access to the multitude of topics and resources on BetterTrades. With your free registration, you will be able to sign up for online interactive classes hosted by a team of professional trading educators, work with our comprehensive article database, or register for one of our live events.

BetterTrades can be your virtual classroom; with some of the top trading instructors working to create classes that will interest, educate, and inspire you, you can participate in a trading education like no other. Work with some of the top names in trading today, and get experience from the professionals who have been on the trading floor and have published books to back up their techniques and skill in the industry. The BetterTrades virtual classes allow you to experience the give and take of a traditional classroom from the convenience of home with their online education programs.

Taking a  Better Trades class is as easy as signing up, and signing on for the class session. You will be able to communicate with your instructor, ask questions, and refine your knowledge of the topic at hand. With BetterTrades, it is easy to work with the system to pick the classes that are interesting to you so that you can get the information you need to trade at your best. Consider starting with our Marketing Essentials course, an amazing overview to help get you off on the right foot.

BetterTrades is more than a virtual classroom environment, though. For those who prefer a more traditional setting,  Better Trades offers live workshops with some of the best minds in trading education to walk you through a wide range of fascinating topics; these classes are constantly offered in major metro areas around the country, and they're the perfect way to kick off your educational experience. BetterTrades is the trading education you've been searching for. Sign up today.

Kamis, 28 Oktober 2010

Better Trades

There are few jobs in the world that don't require training, yet many people believe that trading should require little to know training. Trading on the stock market gives you an unlimited potential for earning money, but all too often, people lose thousands and sometimes hundreds of thousands of dollars simply because they didn't have the knowledge to make effective trades. Instead of just taking a chance, why not learn how to trade the right way? Allow stock market professionals to teach you the strategies that will work for you.

BetterTrades.com is a method unlike many others. Most online sites that promise to teach you how to navigate the stock market are simply regurgitated information from older sites. They are "canned" presentations that deal with simple techniques you can pick up anywhere.

 BetterTrades is something entirely different. Instead of being a website where you can get the same information that is posted everywhere, BetterTrades.com is a method that caters specifically to the individuals enrolled in their courses. The Trading Webshops, the key to this program, are live, interactive courses that you can take in the comfort of your own home. These Webshops will not only teach you the basics of trading, they will teach you how to trade in a way that is beneficial for you.

Wondering how these Webshops work? At BetterTrades.com, you simply sign up for the Webshops that you feel will help you to become a better trader. It doesn't matter if you're looking for beginner courses or more advanced techniques, Better Trades(http://www.better-trades.com/)is sure to have the course for you. Take as many courses as you like. You can even take a webshop again for refresher purposes.

Why should you work hard everyday and invest in a market, only to lose all of your money? Your money is valuable and taking courses from Better Trades can teach you how to intelligently trade your money and how to use the markets to increase your investment. Because they are invested in making sure you can truly use the training they provide, BetterTrades.com is different than the others. If you need a stock market training you can truly use, you need Better-Trades.com.

Rabu, 27 Oktober 2010

Best CD Rates

Certificate of deposits with longer maturity periods pay higher rates than those with shorter maturities. It could be said that the best CD rates have the longest maturities. Some investors believe that a certificate of deposit is the best and safest investment. Others invest in a certificate of deposit to supplement their retirement income. Regardless of the reason, all types of investors want to earn the highest CD rates i.e., best CD rates.

In order to achieve best CD rates, investors need to shop around either online, through newspapers, banners on local institutions, or with the help of brokerage firms to find out which banks and credit unions offer best CD rates all the time. Before purchasing CDs that offer best rates, customers need to consider two factors, the length of the maturity period and the current interest rate environment.  Investors who lock up their money in long term CDs will earn a better rate of interest than those who buy short term CDs. This is due to the fact that when customers purchase CDs with longer maturity periods, they commit their funds in the investment for the entire maturity period before they can withdraw. The investor foregoes alternative courses of investment. For all these risks that investors experience, banks pay best CD rates on such units. Similarly bulk buying also fetches investors best rate because banks may insist on meeting minimum requirement for offering best rates.

It is not advisable for the investor to stay with the same bank for more than one year. By sticking with the same bank, investors lose the chance of getting the highest and best CD rates offered by other banks and credit unions. Generally, the interest rates offered by credit unions, which are non-profit organizations, are the best when compared to those offered by commercial banks.

Selasa, 26 Oktober 2010

Beginners Information About Trading Penny Stocks Online

Since writing about trading penny stocks online over at my blog, I received several emails about the subject and it seems to have generated a good deal of interest.

People have been trading stocks online since the very early days of the internet, and nowadays it is a simple matter for anyone who decides they want to get involved to start online trading.

However, there are several things you should be aware of before deciding to start trading stocks, not least of which is that it is a gamble, and this applies regardless of your knowledge or experience. You need to have some money to invest and it should be money that you can affors to lose. Bear in mind the worst case scenario - i.e. that you could get it horribly wrong and your investment could disappear overnight. Fair warning if you don't want to read any more.

Much has been written about trading stock online, in particular penny stocks, and by far more qualified people than me.

If the idea of an exciting risky investment strategy appeals to you, trading penny stocks could be the adrenalin fix you are seeking. It's pretty simple to get started, but success or failure are equally possible results.

Firstly, penny stocks are usually defined as stocks trading at below $5 a share. Some people consider this arbitrary amount differently and would say that $2 would be a better yardstick, but, whatever the definition, these are shares usually traded outside of the major exchanges. They are often volatile and unpredictable and their performance is very difficult to monitor or foresee.

It is fair to say that stock trading at a few cents a share is the most risky investment anyone could make - many experts would say foolhardy in the extreme. The temptation to buy thousands of shares for a few cents is one that often results in many people getting their fingers burned. What you have to remember is that there is a reason the stock is so cheap - it really isn't worth much and the likelihood of making a killing on such shares is far from the foregone conclusion that some people will try to convince you it is. Establishing the likely performance of these stocks is usually virtually impossible as often there is very little information available on the companies to do any kind of meaningful analysis.

Don't be lured into buying stocks just because a newsletter or email tells you it is a sure thing. There are plenty of sharks out there who will engange in the practice known as "pump and dump", whereby they will attempt to generate unsubstatiated hype about a particular stock in the hope that there will be a rush to buy, enabling them to sell on their worthless holdings to unsuspecting hopefuls. You really must excercise caution and do your own "due diligence" - if you don't, you will soon end up regretting impulsive penny stock purchases.

Trading stock online is not difficult, and once you have a basic understanding of how it works and decide to give it a try, you will need an account with an online stockbroker.

For penny stock trading Lowtrades.com offer a very good service. To set up an account you will need to submit an application form by post. This can be downloaded in PDF format from their site. Once you have opened an account you will need to fund it (more details of how to do this are listed at the site too) and then, you are ready to trade.

In very simplistic terms you will place orders with your broker via the online trading interface and they will carry out your buying and selling instructions. Each trade you carry out, buying or selling, will cost you a small commission to the broker. With Lowtrades usually around $5.

Presumably your interest in penny stocks means that you are looking to make quick returns. It is true that he rewards can be tremendous - it is entirely possible to make hundreds of dollars in a day. By the same token, get it wrong and the losses can soon mount up too. Day trading is not always profitable, but it's always risky. Day traders buy stock and aim to sell it on the same day for a profit - the age old buy low, sell high strategy. Of course, if the stock price falls, you have a decision to make - sell it at a loss, or hold on in the hope that prices will recover and you can mitigate your losses.

You have to understand that not every stock you buy will appreciate in value during the course of one trading day. This means you could end up with your risk capital tied up in one company, leaving you unable to make any other trades until you offload the stock. Having all your eggs in one basket is therefore not a great trading strategy.

For those with limited funds to invest, this can present a bit of a dilemma. There is little point buying so few shares that even if the price rockets upward, you will make only a few dollars - you must also remember to deduct brokerage fees from overall profits too. If you are working with only a small amount of capital, you are going to need to find resonably priced stock that allows you to buy a few hundred shares, certainly not less than 100. For example, if you can secure 300 shares and the price rises by 25 cents, you will net yourself only $75 less any commissions - hardly earth shattering. On the other hand if the stock value increases by a dollar, you have $300. The basic math is simple enough, so you need to look carefully at whether an investment is likely to be worthwhile relative to the amount you are able to invest.

It goes without saying that the more investment capital you have, the more you stand to make, or lose.

Opening a trading account is straightforward enough once you know the kind of account that you need. For a simple individual cash account some brokers will require a minimum deposit and others will not. Shop around to find the best deal for your own personal circumstances. Charges will vary too, and these all affect your bottom line, so make sure you know how much each trade is going to cost you.

Finally, I will repeat my earlier advice - never invest anything that you can't afford to lose. Penny Stocks are a gamble, and if you don't have the constitution for risking the purchase price, don't start with online trading of any kind. Sit back and have a good think about what you are planning to do and what you hope to achieve through your investments. If you are thinking of day trading you will need to be in a position to monitor your stocks throughout the trading day - if you are not going to be able to do this, you will not be able to sell when the need arises - i.e if the price should spike briefly.

If you want to start trading penny stocks online, read up on the subject carefully and learn as much as you can. There are plenty of helpful websites such as AllPennyStocks.com where you can begin to learn and I have also included some useful resources below for those wanting to learn more. Never let anyone tell you that it's as easy as falling off a log though - if it was, we's all be millionaires by now!

Senin, 25 Oktober 2010

Be Cautious When Studying Mutual Fund Ratings

Wherever you look, you will find various rating systems on mutual funds, each of which uses a different approach. All of them are designed to weed through the thousands of funds to get to the best ones. But is there really such a thing? Does a high rating really mean a fund will do better in the future? Many people seem to think so. A recent study showed that Morningstar, North America's most recognized rating system for funds, has a tremendous influence on fund sales. If Morningstar gives a five-star rating, those funds typically enjoy increased sales as a result.

While ranking providers are careful to warn investors that their ratings don't foretell the future, the star system is, unfortunately, used by some investors as if they were reading Consumer Reports to purchase a new drill. Supporters of the ranking approach argue that there's no subjective component to the star rating. It isn't determined by an analyst's review, and can't change simply because the service dislikes the fund's manager or its investment strategy. And that's good.

Performance will vary. Fund performance often falls off and risk levels rise during the subsequent three years after a fund is given an initial five-star Morningstar rating, suggests another recent study by Matthew Morey, a professor at Pace University. One reason for this is that after receiving a five-star rating the size of the fund grows dramatically, which then makes the fund unwieldy to manage, he suggests. Since Morey's study was completed, Morningstar also has changed the way it doles out top rankings to make them more precise. One of the biggest problems with all rating systems is that they are not necessarily predictive in nature. This means they're not really set up to tell you whether certain funds will necessarily do better in the future. For the most part, the ratings indicate how much you might have made and how much aggravation you faced in the process.

Combining risk and return. For example, one five-star fund might post moderate return scores, but incredibly low risk scores. Another five-star fund might have much higher-risk scores, but its return score could be strong enough to help it still rank in the top 10% of the pack.

In some cases, in fact, it's not even the same fund to begin with. Remember, after a management change, the rating stays with the fund, not the portfolio manager. Therefore, a fund's rating might be based almost entirely on the track record of a manager who is no longer with the fund.

Understand how the ratings were developed. Too many people put emphasis on the results without knowing how the results were achieved. If you are going to use ratings, take the time to understand how they were developed and what they really mean. It is not the destination but the journey that counts.

Past performance is no guarantee of the future. You have probably heard this disclaimer a thousand times before, but it is really important to understand. Most rating systems have little to no predictive element in them. It's natural to think that the best performer of the past will be the best performer in the future. Unfortunately, it's not that simple. Just think about it; if it were that easy, investors would just continue to buy last year's winners knowing that they will be this year's winners. And that seldom works.

Ratings are a very important element in trying to distinguish between good and bad funds. Good research, however, goes far beyond just looking for five stars or an A+. When evaluating funds, look at the quantitative, measurable characteristics of a fund: returns up against the benchmark, costs, risks, taxes and manager tenure. Use rating systems as part of your research, but remember: just because the analysts give them top marks, it does not mean they will be the best investment in the future, and doesn’t it mean that they'll be the best investment for you in particular. Take the time to understand how the ratings were achieved. This will be the first step to educating yourself about funds.

Minggu, 24 Oktober 2010

Basic Principles Of An Investing Club

Investment clubs are created by individuals who not only want to pool their funds together to make a joint investment but would also like to gain knowledge on the various types of viable investment opportunities that are available in the market. Each member of the club contributes periodically an agreed amount of money to purchase growth stocks by means of a dollar cost averaging approach.

The dividends as well as the capital gains are usually reinvested to gain more interest. The security purchases are voted upon by the club members. This is also one way of decreasing personal risk of club members. There are also investment clubs that allows non-club investors to participate in larger investments of the club provided of course that the non-member investors receive a much lower share of commissions.

Likewise, it is also the role of investment clubs to assist their club members in becoming more knowledgeable in all aspects of investments. A well-known trade group for investments clubs is the National Association of Investors Corporation (NAIC) which is a non-profit organization that provides guidance as well as imparting investment knowledge as part of its membership.

A good choice of investment clubs are those that have been around for many decades already and have a track record of having a continuous increasing interest in the stock market. By joining investment clubs, small investors are given the opportunity to increase their buying power, share their collective knowledge and socialize while earning from their investment. Another good benefit derived from investment clubs is the fact that investors are not expected to invest a great deal of money but still will be able to receive a greater amount of interest that is usually possible if you have similarly invested a big lump money.

A typical investment club usually meets once a month and members are given individual responsibility of researching investments and then sharing their ideas with the other members of the club. Likewise, these meeting also served as an occasion for members to contribute to their monetary fund, which is intended for purchasing stocks, mutual funds as well as other types of feasible investments.

One of the main goals and objectives of an investment club is the opportunity to learn. Most investment clubs spent a great deal of effort and time in research since they believe that a well-researched investment plan has a much greater chance of success. This is also the reason why risk is minimized when joining an investment club.

Starting an investment club is not really that difficult and does not require any special knowledge. In fact, a group of friends or even co-workers can decide to set up an investment club. This is usually a good place to start as you will know the people you dealing with.

Sabtu, 23 Oktober 2010

Basic Investing Rules

Investing your money can be a great way to ensure your financial future. With the right investment choices, you can be sure to have money for emergencies, to put towards the education of your children, and to have available when the time comes for you to retire. There is a key word in the preceding phrase however- “right”. If you make the wrong investment choices, you may just end up where you started or worse, flat broke. Most people who invest wisely by making the right decisions with their money follow the same basic investment pattern, although they may define it by another name. It might be that you are the cynical type who chooses to believe that the basic rules could not possibly be as easy as they seem, in an area that seems so complex. It is true. However, that these rules have withstood the test of time.

First of all, make sure that the money you choose to invest is indeed earmarked for the purpose. As in any form of gambling, there is nothing to be gained and everything to be lost when it comes to investing. Do not put up money that you cannot afford to lose should the market take a downturn.

One rule that people seem to refuse to apply in any area of their lives, including the world of investing, is lean not on your own understanding. Most of the time, this is the result of people balking at entrusting another person with their money, believing that with a little understanding they can work the market themselves. This reasoning is fundamentally flawed. In the first place, most people will not be able to begin to unravel the complicated graphs, pie charts, and statistics by which the investment world relates its information. In order to understand what the numbers mean, you will need to have some basic training. There may come a time after you have had some experience in the market that you will be able to make sound decisions on your own, but the initial get-your-feet-wet phase is not the time to attempt it. Check the background of the advisor you choose, as there are a lot of brokers out there looking for a quick fleece. The best brokers will have years of experience, a variety of investment backgrounds, and will probably cost you much less than you might think.

Think long term. Unless you invest millions of dollars initially, it will take time for your investments to mature and begin to accumulate substantial gains. The best investments are proven over time, and thus it is best to place your funds in long term choices. The details of this are plain- it is best to forget about this money in terms of a cash fall back, at least for a number of years.

Diversification is an oft-flogged truism of the investment world. A good portfolio will include cash and cash equivalents (GICs, fixed annuities), growth investments (stocks), and growth and income investments such as mutual funds. Diversification ensures that you do not have all your eggs in one basket should any part of the market experience a downturn. Note that diversification means not only investing in several areas, but also making sure that no one area contains a disproportionate percentage of your funds.

Jumat, 22 Oktober 2010

Bank Foreclosure Profit Opportunities

<b>In Many Cases, The Lender Or Agency Simply Wants To Get Rid Of Foreclosure Bank Owned Properties Quickly – Even If It Means Selling At A Low Price</b><br>
Upkeep of foreclosure bank owned properties costs more than selling them cheap. Whether you are a homebuyer or a foreclosure homes investor, foreclosure bank owned properties allow you to buy properties at a fraction of their market value. Lenders aren't chartered to own and manage property, so they face close scrutiny and pressure from state and federal regulators to dispose of foreclosed properties quickly - especially if they're on a regulator's "watch list".

The second reason why foreclosure bank owned properties are sold at below market value has to do with their condition. And because they're dealing directly with the bank they can eliminate the 6 percent sales commission if they act fast - before the bank lists the property with a real estate agent. Bank foreclosed homes are sought out by investors because of their profit potential.

In many cases, the lender or agency simply wants to get rid of foreclosure bank owned properties quickly – even if it means selling at a low price. Foreclosure bank owned properties are an excellent opportunity for anyone who wants to save money on their next real estate purchase. It is not uncommon to find bank foreclosed homes sold at prices much lower than their market value.

Foreclosure bank owned properties are priced at up to 5% to 50% off their market value, simply because of the way you can buy and sell foreclosure bank owned properties. It is possible to gain a nice return on your investment when you invest in bank foreclosed homes. Foreclosure bank owned properties are homes that have been repossessed by a government agency or lender due to non-payment of the mortgage. When their REO departments are loaded with foreclosures, investors are able to finagle below-market interest rates with little or no cash down.

<b>When A Homeowner Cannot Pay The Mortgage For A Few Months At A Time, The Bank Will Initiate Foreclosure Proceedings Against The Owner</b><br>
In order to get the best deals on foreclosure bank owned properties, you need to be prepared and shop wisely. The owner will be anxious to sell to avoid having a foreclosure as a black mark on their credit report. Bank foreclosed homes are homes that are owned by banks or other lending institutions because of the lender having foreclosed on the property. Once you find some foreclosure bank owned properties you like, though, you still need to research.

Researching foreclosure bank owned properties can help you tell the deals from the duds. After the foreclosure is final, the bank foreclosed home will be offered for sale, either directly by the bank, or through real estate auctions. When a homeowner cannot pay the mortgage for a few months at a time, the bank will initiate foreclosure proceedings against the owner.

You cannot let emotions rule your purchase, and you cannot assume that all foreclosure bank owned properties are sold at below market value. If the property has accumulated enough equity, the investor will make a very nice profit. What Are Bank Foreclosed Homes?

<b>Bank Foreclosed Homes Auctions</b><br>
Bank Foreclosed Homes Auctions. For each home you consider, determine your closing costs, actual house costs, incidental costs, and financing costs. Sometimes the bank foreclosed homes will be sold at real estate auctions.

Once you calculate the cost of any repairs needed, add it to the total cost of the property. Remember to account for the time that it will take to repair the bank foreclosed home.

This approach means that you wouldn't reimburse them for any accumulated charges such as interest, late charges, foreclosure fees, legal fees, nor any advances they might have made toward senior loans, property taxes, insurance. Sometimes an inspection is not possible, so you should only make bids that leave a nice margin for any unknown repairs. Get a market value for the home and an estimate for the repairs that need to be done.

To figure the number of loan payments made, start when the deed of trust recorded and end with the delinquency date that's listed on the recorded Notice of Default. On the other hand, if you do it carelessly, you could end up paying a lot more for the bank foreclosed home than it is worth. Hiring a professional assessor and inspector to examine the property for you.

Find out how much homes in the same neighborhood sell for as well. At the most, you shouldn't pay the bank any more for their equity in the property than what they originally lent on it minus the payments that were actually made on the loan.

<b>If You Are Looking For An Investment, Make Sure That You Will Get At Least 15% Or More In Profit Through Renting Or Selling, And Remember That Many Foreclosure Bank Owned Properties Allow You To Earn More On Your Investment</b><br>
An important aspect of investing in bank foreclosed homes is having good listings so that you can get to the properties before they are gone. Good bank foreclosed homes do not stay in the market long.

If you are seeking a home, look for foreclosure bank owned properties in areas you would like to live that have the amenities you want. A better use of your time and money is to sign up with an online bank foreclosed homes listings service.

Whether you are looking for foreclosure bank owned properties that are investments or a home will determine which foreclosure bank owned properties are deals for you. These foreclosure bank owned properties you are considering should save you money on your home so that you can enjoy equity fast. If you are looking for an investment, make sure that you will get at least 15% or more in profit through renting or selling, and remember that many foreclosure bank owned properties allow you to earn more on your investment.

Bank Foreclosed Homes Listings. Buying up lenders' REO's (real estate owned) is a workable approach when it's a Buyer's market and lenders have lots of REO's they are anxious to get rid of. Finally, insist that the lender provide you with all the customary buyer safeguards such as escrow, title insurance, homeowner's warranty, termite clearance. You can get bank foreclosed homes listings from courthouses, lending institutions, government agencies.

<b>And Lender Deals Typically Include Title Insurance, Which Removes Much Of The Risk That Accompanies Buying Homes Earlier In The Foreclosure Process</b><br>
If the property fails to sell at auction, or if the lender ends up as the highest bidder, the home becomes REO, or "real estate owned" by the bank. Often these homes are sold to buyers who don't even know they are buying a foreclosure, and go through the entire process as they would with any other home. And lender deals typically include title insurance, which removes much of the risk that accompanies buying homes earlier in the foreclosure process.

Kamis, 21 Oktober 2010


I have often taught that there is a countermove for everything that a market or stock can throw at you. You may not know it but there is one. This is generally a true statement because if you wait too long, there are some situations you can't get out of but for the most part there is a way to respond to and survive just a bout anything. IF YOU KNOW WHAT TO DO AND HOW TO DO IT. The emphasis is to make the distinction that knowing is not enough. You must know how and that takes training. However it does start with knowing what.

I developed the Balloon Strangle as a way to counter the effects of high volatility and unpredictability (ie. Danger) of news announcements that happen when the market is closed. This would be like earnings after hours or an anticipated Board meeting or a court ruling. Something that could move the stock in a big way but you don't know for sure which way. Conventional wisdom (and it is good advice) is to avoid this like a plague.

A conventional strategy to mitigate the effects of volatility is the strangle or straddle play. Traditional positions for a strangles and straddle are at or near the money. You take opposing positions so that either way it goes you have a winning position. You hope that the move is big enough that the losing position goes to zero and then the winning one can make money. Problem… near the money position are expensive and the move must be quite large to erase one position and still move far enough to make money on the other one. But the idea is that you are somewhat insulated from the unknown. At least you can stay even as one goes up in value and the other goes down.

The Balloon Strangle was a twist using the leverage of Out of the Money positions. If you use a graphic to show the option prices you will often see a leverage point in the curve created by plotting the option prices. It occurs in the Out of the money positions. It represents a spot where the value of the option changes much faster in one direction than the other. In other words if the stock moves one way the value of the option changes very fast but very slow if it moves the other way.

Here is an example of a Balloon Strangle on an earnings play with YHOO. I played this because of the potential YHOO had to move far enough to make the cost of both an Out of the money call and a put pay off. The potential was for a double of my money.

Now YHOO sits ½ way between the important price levels. This is the perfect setup for this play. The YHOO earnings usually has a big move and it is has clear targets.

Now here is what happened. YHOO moves like it was following a script. The upside move goes right to resistance.

Now the results… YHOO moved up to resistance and hesitated. 2 hours into the trading day and at the next sign of hesitation I pulled the plug on the trade. Resistance seemed to be holding, I got what I was looking for in an up side move so I sold both positions. The net of $1.75 was very close to the estimate of $1.70.

By the way, as the day wore on and YHOO did not make any attempt to move higher, the Oct 42.50 began to drop in value much faster than the stock sagged. This dropped the 42.50 calls over .50 while the stock pulled back .60. Waiting for the end of the day would have cost me over .50. The play was to be in only to catch the reaction to the news.

This strategy takes practice and applies to potentially good sized moves. Always practice with out funding first.

Ryan with Better Trades

Rabu, 20 Oktober 2010

Avoiding suspicious activity reports in cash transactions

Many people ask "just what is considered illegal or suspicious activity when moving cash?" Some people have gone to the bank with the cash proceeds of a garage sale or a car sale on the weekend, and recounted horror stories of multiple questions by bank employees and have sometimes been reported to the government as suspected criminals.

The reality is that such reporting is very plausible. Most western countries have enacted cash transaction legislation that mandates it. In Australia, anything over $10,000 must be reported to regulators, and any amount under that that bank staff deem suspicious. Likewise in the U.S. So, if you’re unusually scruffy-looking and wander into a bank with $4,000 cash to deposit, it’s very possible you will be reported by the teller. (See our article Money Laundering Defined on the web site www.powerprivacy.com for details on U.S. Currency Transfer Reports, or CTRs.)

Here’s a list of most things that can trigger staff’s suspicion and get you reported next time you go to the bank. Banks will not give you a list of or even admit the existence of these criteria, regardless how much you ask:
- A customer refuses to provide identification or explain the purpose of a transaction.
- A customer has a known criminal background and engages in substantial transactions.
- A customer is ignorant of basic facts regarding the transaction or is unconcerned about rates, taxes, etc.
- A customer is controlled by another person, particularly where the customer appears unaware, infirm or elderly and is accompanied by a non-relative.
- A customer conducts cash transactions when his/her employment or business does not ordinarily generate or require such amounts of cash.
- A customer repeatedly sends or receives wire transfers of any dollar amount when his/her business does not normally require or originate such wires.
- A customer has no apparent source of income, yet conducts repeated transactions.
- A customer offers a seller a gift, gratuity or bribe to complete a transaction.
- A customer divides transactions into smaller amounts to avoid identification or reporting requirements.

Suspicious Customer Behavior
- Customer has an unusual or excessively nervous demeanor.
- Customer discusses your record keeping or reporting duties with the apparent intention of avoiding them.
- Customer threatens an employee attempting to deter a record keeping or reporting duty.
- Customer is reluctant to proceed with a transaction after being told it must be reported.
- Customer suggests payment of a gratuity to an employee of the financial institution.
- Customer appears to have a hidden agenda or behaves abnormally, such as bypassing the chance to obtain a higher interest rate on a large account balance.
- Customer who is a public official opens account in the name of a family member who begins making large deposits not consistent with the known legitimate sources of income of the family.
- Customer makes a large cash deposit without counting the cash.
- Customer frequently exchanges small bills for large bills.
- Customer's cash deposits often contain counterfeit bills or musty or extremely dirty bills.
- Customer who is a student uncharacteristically transfers or exchanges large sums of money.
- Account shows high velocity in the movement of funds but maintains low beginning and ending daily balances.
- Transaction includes correspondence received that is a copy rather than original letterhead.
- Transaction involves offshore institutions whose names resemble those of well-known legitimate financial institutions.
- Transaction involves unfamiliar countries or islands that cannot be found in an atlas or map.
- Agent, attorney or financial advisor acts for another person without proper documentation such as a power of attorney.

Suspicious Customer Identification Circumstances
- Customer furnishes unusual or suspicious identification documents and is unwilling to provide personal background data.
- Customer is unwilling to provide personal background information when opening an account.
- Customer opens an account without identification, references or a local address.
- Customer's permanent address is outside the bank's service area or outside the country.
- Customer's home or business telephone is disconnected.
- A business customer is reluctant to reveal details about the business activities or to provide financial statements or documents about a related business entity.
- Customer provides no record of past or present employment on a loan application.
- Customer claims to be a law enforcement agent conducting an undercover operation, when there are no valid indications to support that.

Suspicious Cash Transactions
- Customer comes in with another customer and they go to different tellers to conduct currency transactions of less than $10,000.
- Customer makes large cash deposit containing many $50 and $100 dollar bills.
- Customer opens several accounts in one or more names, then makes several cash deposits that are less than $10,000.
- Customer conducts unusual cash transactions through night deposit boxes, especially large sums that are not consistent with the customer's business.
- Customer makes frequent deposits or withdrawals of large amounts of currency for no apparent business reason, or for a business that generally does not generate large amounts of cash.
- Customer conducts several large cash transactions at different branches on the same day, or orchestrates persons to do so on his behalf.
- Customer deposits cash into several accounts in amounts below $10,000 and then consolidates the funds into one account and wire transfers them outside of the country.
- Customer attempts to take back a portion of a cash deposit that exceeds $10,000 after learning that a currency transaction report will be filed on the transaction.
- Customer conducts several cash deposits below $10,000 at automated teller machines.
- Corporate account has deposits or withdrawals primarily in cash rather than cheques.
- Customer frequently deposits large sums of cash wrapped in currency straps, stamped by other banks.
- Customer makes frequent purchases of monetary instruments for cash, in amounts less than $10,000.
- Customer conducts an unusual number of foreign currency exchange transactions.
- Customer frequently uses foreign currency to purchase bank cheques under $3,000.

Suspicious Non-Cash Deposits
- Customer deposits a large number of traveller's cheques often in the same denomination and in sequence.
- Customer deposits money orders bearing unusual markings.

Suspicious Wire Transfer Transactions
- Non-accountholder sends wire transfer with funds that include numerous monetary instruments of less than $10,000 each.
- An incoming wire transfer has instructions to convert the funds to bank cheques and mail them to a non-accountholder.
- A wire transfer that moves large sums to secrecy havens such as the Cayman Islands, Hong Kong, Luxembourg, Panama or Switzerland.
- An incoming wire transfer followed by an immediate purchase by the beneficiary of monetary instruments for payment to another party.
- An increase in international wire transfer activity, in an account with no history of such activity or where the stated business of the customer does not warrant it.
- Customer frequently shifts purported international profits by wire transfer out of their home country.
- Customer receives many small incoming wire transfers and then orders a large outgoing wire transfer to another country.
- Customer deposits bearer instruments followed by instructions to wire the funds to a third party.
- Account in the name of a currency exchange house receives wire transfers or cash deposits of less than $10,000.

Suspicious Safe Deposit Box Activity
- Customer's activity increases in the safe deposit box area, possibly indicating the safekeeping of large amounts of cash.
- Customer often visits the safe deposit box area immediately before making cash deposits of sums less than $10,000.
- Customer rents multiple safe deposit boxes.

Suspicious Activity in Credit Transactions
- A customer's financial statement makes representations that do not conform to Generally Accepted Accounting Principles.
- A transaction is made to appear more complicated than it needs to be by use of impressive but nonsensical terms such as "emission rate," "prime bank notes," "standby commitment," "arbitrage" or "hedge contracts."
- Customer requests loans to offshore companies or secured by obligations of offshore banks.
- Customer suddenly pays off a large problem loan with no plausible explanation for the source of funds.
- Customer purchases certificates of deposit and uses them as collateral for a loan.
- Customer collateralises a loan with cash deposits.
- Customer uses cash collateral located offshore to obtain a loan.
- Customer's loan proceeds are unexpectedly transferred offshore.

Suspicious Commercial Account Activity
- Business customer presents financial statements noticeably different from those of similar businesses.
- A large business presents financial statements that are not prepared by an accountant.
- Retail business that provides cheque cashing service does not make large withdrawals of cash against cheque deposits, possibly indicating that it has another source of cash.
- Customer maintains an inordinately large number of accounts for the type of business purportedly being conducted.
- Corporate account shows little or no regular, periodic activity.
- A transaction includes circumstances that would cause a banker to reject a loan application because of doubts about the collateral's validity.

Suspicious Trade Financing Transactions
- Customer seeks trade financing on the export or import of commodities whose stated prices are substantially more or less than those in a similar market situation.
- Customer makes changes to a letter of credit beneficiary just before payment is to be made.
- Customer changes the place of payment in a letter of credit to an account in a country, other than the beneficiary's stated location.
- Customer's standby letter of credit is used as a bid or performance bond without the normal reference to an underlying project or contract, or in favor of unusual beneficiaries.

Suspicious Investment Activity
- Customer uses an investment account as a pass-through vehicle to wire funds, particularly to off-shore locations.
- Investor seems unconcerned about the usual decisions to be made about an investment account such as fees or suitable investment vehicles.
- Customer wants to liquidate a large position through a series of small transactions.
- Customer deposits cash, money orders, traveller's cheques or bank cheques in amounts under $10,000 to fund an investment account.
- Customer cashes out of annuities during the "free look" period or surrenders early.

Suspicious Employee Activity
- Employee exaggerates the credentials, background or financial ability and resources of a customer, in written reports the bank requires.
- Employee frequently is involved in unresolved exceptions or recurring exceptions on exception reports.
- Employee lives a lavish lifestyle that could not be supported by his or her salary.
- Employee frequently overrides internal controls or established approval authority or circumvents policy.
- Employee uses company resources to further private interests.
- Employee assists transactions where the identity of the ultimate beneficiary or counter party is undisclosed.
- Employee avoids taking holidays.

Selasa, 19 Oktober 2010


Due to an overwhelming request of questions about Day Trader Status I have decided to write this newsletter to look at these issues. Whether you know about it or not, you don't want to accidentally learn about Day Trader Status by a notice from your brokerage firm saying that you are now tagged as a Day Trader!


A Day Trader is someone who does four intra-day trades in five consecutive trading days. Let me address some terms here to help you understand this better:

      Intra-day trade: A trade that is opened and closed in the same trading day (round trip).

      Five Consecutive Trading Days: These are calendar days that the market is open, all in a row. For example:

            If the market was open on Monday through Friday that would be five consecutive days.

Then we would have Tuesday through Monday for the next five consecutive days (unless Monday was a holiday in which case it would then be Tuesday through Tuesday.

            Next, we would have Wednesday through Tuesday, and so on. The key is five trading days in a row.


One of my favorite students, Debi D, taught me to use a calendar to record my intra-day trades. By placing an "X" on the day

you do intra-day trades, (2 X's if you do two, 3 X's if you do 3 in that day) you can avoid accidentally getting to four by

looking at your calendar. Make sure you mark the days the market is closed on your calendar.


I thought it mattered a lot, but after my research for this newsletter, it appears there actually are some great benefits

being classified as a "Day Trader" if the $25,000 is not an issue for you. Basically there are two issues at hand:

      ISSUE ONE: Your brokerage firm will likely impose the NASD requirements of maintaining at least $25,000 in your trading

account - and you have 5 days to comply. If you have this kind of money there is no issue! However, if you are starting out

with limited funds to trade it could be a big issue! One important note - always ask for one time of forgiveness! Many

students told me they did and the status was removed - so ASK! There may be a way around it, but I am not sure. From my

reading of the requirements, the penalty for not complying is that you are subject to cash only trades, (which are what we

were doing anyway with options)!

      There is a really incredible benefit though if you are tagged a Day Trader and maintain the $25,000 minimum value in

your account. You may be eligible for day-trading margin, which is 4 times account buying power. WOW DO I EVER LIKE THIS

ONE!! This buying power may only be used intra-day and may not be held past market close. Orders exceeding Day-Trading Buying

Power will be rejected.

      ISSUE TWO: Tax Consequences with the IRS

            Actually upon my research into the IRS Publications it does not appear as bad as I thought. A tax firm specializing in trading activity, says:
          o They allow a full deduction of all trading losses in the year they occur, thereby circumventing the historical $3,000 net capital loss rule.
          o They allow full current expensing of trading expenses without limitation, thereby circumventing the limitation on miscellaneous itemized deductions.
          o They enable the active trader to still take advantage of the beneficial long term capital gain rules.

          o They enable the active trader to circumvent the restrictive "Wash Sale" rules normally applied to investors, thereby alleviating a huge record-keeping nightmare.

          o They allow the active trader to deduct losses on open as well as closed positions.

      Continuing on with my IRS research:

      You would report your trader's activity as a business on Schedule C of your 1040, possibly allowing all the deductions for your classes and tools, versus a limitation on deduction for passive trading that would have had to be reported on your

Schedule A with a 2% AGI limitation deduction. But here is the sweet deal: you can still elect to report your gain or loss on

Schedule D as a capital gain unless you made the mark-to-market election, (which has you claim the income as ordinary income on Form 4797 instead of Schedule D - see IRS Publication 550 for more information on this). Just to be safe, you better talk to an accountant that specializes in stock market trading. Being a retired accountant, I want to tell you that most accountants will not know how to treat your trading income properly - you need to understand this.

The proper classification of your investment activities is important to determine how income and expenses are to be reported.

Traders that buy and sell securities frequently can report their purchases and sales result in capital gain and loss, and their deductible expenses are trade or business expenses.

Happy Trading!

Darlene Powell with Better Trades

Senin, 18 Oktober 2010

Angel Investors Definition

Angel investors are one of the financing options that you can look into when you decide to start your own business venture. Business start-up is not only a crucial process it also requires a lot of time, effort, and of course money. If you do not have the money needed to fund your business, then how can you start your operation? That is why, when you start planning your business venture, you have to carefully consider your capital. And if you do not have a large amount to start with, you can rely on angel investors to provide you capital. But before looking for one, you have to make sure that you understand the angel investors definition.

Angel investors are high-net worth and accredited individuals that give financial aid to future business owners who are in need of start-up money. They are well-educated, have valuable experience in business, and possess a large sum of money which they invest in exchange for ownership equity. They are usually the best financing option during the early stage of the business. Nowadays, lots of individuals choose to become angel investors. And so when you start your search for the right angel investor, it is important that you know the angel investors definition of each type.

Corporate Angel Investors Definition

Corporate angels are former business executives who have retired early or have been replaced. Although investment is one of their goals, they look for personal opportunity at the same time. So, usually they want to acquire a position in the business as part of the deal. But this should be thoroughly discussed since some corporate angels can be too controlling.

Entrepreneurial Angel Investors Definition

Entrepreneurial angels are successful business owners themselves. Unlike the corporate angels, they can take bigger risks and provide larger amount of money since they have a steady income source. Usually, these businessmen want to assist future business owners to have a successful start-up and eventually a competitive business. The major advantage of these angels is that they are less demanding and they allow the business owner to grow in his own, with them only as financial back-up.

Enthusiast Angel Investors Definition

Enthusiast angels are retirees who simply enjoy getting involved in different business deals and transactions. They are mostly above 65 years old and are already wealthy even before they start their own businesses. Just like the entrepreneurial angels, they also don’t want to play any role in business management. 

Micromanagement Angel Investors Definition

Micromanagement angels are individuals who have exerted their own efforts in order to become wealthy. Because of their experience, they believe that they know exactly how a business should be managed. Although they are not active participants in management, they can be very visible when the management of the business starts to have problems and is not doing well.

Professional Angel Investors Definition

Professional angels are lawyers, accountants, and doctors who want to make investments in companies that offer a service or product with which they have little experience. Their main goal of investing is to be hired by the business at the same time as consultant in their area of expertise.

These are the different types of angel investors that you might encounter when you start looking for the right angel investor for your business. By keeping these angel investors definitions in mind, you can easily decide which one is appropriate for you.

Minggu, 17 Oktober 2010

Angel Investors Bring Big Ideas To Reality/Radio

If you're an emerging company with the next great product, sometimes you need an angel on your side.

A study by the University of New Hampshire's Center for Venture Research showed that "angel investors" - high-net-worth individuals willing to invest in entrepreneurial companies at an early stage - shelled out more than $18 billion into early-stage companies last year alone, compared to $304 million by venture capitalists.

Finding an angel investor, however, is not an easy task. Safer Smokes Inc. is one company that understands the challenge of attracting the right investors.

This development-stage company is tapping the smoking cessation market with a unique tobacco-free, nicotine-free smoke called Bravo, which has the appearance of a traditional cigarette and burns like tobacco, but is actually made from lettuce fibers.

"Bravo lets you smoke your way out of the tobacco habit gradually," said Puzant C. Torigian, chief executive officer of Safer Smokes.

For companies like Safer Smokes, it may be too soon to approach large venture capital firms, yet time to move beyond networking with family and friends. Angel investors to the rescue.

"The challenge for raising capital in today's market is in harnessing the courage and vision of the angel to see through to the real investment opportunity," said Torigian.

So how do companies like Safer Smokes attract their angel?

* Have a clear-cut target market for your product or service. For example, Safer Smokes is targeting the smoking cessation market, which has sales approaching $10 billion per year, up from $6 billion just three years ago.

Most angel investors prefer companies that are likely to show positive cash flow within their first 18 months, so having these kinds of statistics about your market can be an incentive.

* Match the business plan objectives to the angel's risk tolerance. Investors want to know the product or service will be unique and well-cultivated. Safer Smokes has a patented solution that company officials say will "affect the landscape of the health care industry."

Sabtu, 16 Oktober 2010

Angel Investors Bring Big Ideas to Reality

If you're an emerging company with the next great product, sometimes you need an angel on your side.

A study by the University of New Hampshire's Center for Venture Research showed that "angel investors" - high-net-worth individuals willing to invest in entrepreneurial companies at an early stage - shelled out more than $18 billion into early-stage companies last year alone, compared to $304 million by venture capitalists.

Finding an angel investor, however, is not an easy task. Safer Smokes Inc. is one company that understands the challenge of attracting the right investors.

This development-stage company is tapping the smoking cessation market with a unique tobacco-free, nicotine-free smoke called Bravo, which has the appearance of a traditional cigarette and burns like tobacco, but is actually made from lettuce fibers.

"Bravo lets you smoke your way out of the tobacco habit gradually," said Puzant C. Torigian, chief executive officer of Safer Smokes.

For companies like Safer Smokes, it may be too soon to approach large venture capital firms, yet time to move beyond networking with family and friends. Angel investors to the rescue.

"The challenge for raising capital in today's market is in harnessing the courage and vision of the angel to see through to the real investment opportunity," said Torigian.

So how do companies like Safer Smokes attract their angel?

* Have a clear-cut target market for your product or service. For example, Safer Smokes is targeting the smoking cessation market, which has sales approaching $10 billion per year, up from $6 billion just three years ago.

Most angel investors prefer companies that are likely to show positive cash flow within their first 18 months, so having these kinds of statistics about your market can be an incentive.

* Match the business plan objectives to the angel's risk tolerance. Investors want to know the product or service will be unique and well-cultivated. Safer Smokes has a patented solution that company officials say will "affect the landscape of the health care industry."

Jumat, 15 Oktober 2010

An Overview Of Forex Investing Strategies

FOREX trading refers to an international, 24/7, over the counter, exchange market where currencies of different nations are bought and sold. Trading is always done in pairs assuming the price of currency bought to go up and that sold to fall down. It is the largest liquid financial market making it impossible for any single investor to influence the prices of currencies.

There are two kinds of FOREX investing strategies:



Technical analysis is mostly undertaken by small and medium size investors.
A technical analysis considers factors that are actually affecting the market rather than factors that can affect it. Thus the price quoted reflects all the factors that have influenced it. Only market generated facts and figures are taken into account and factors like fear, hope, expectations or other changes are not considered. Thus the analysis is generally based on these suppositions:

• Price reflects all actual market movements. That means price includes everything known to the market like supply and demand of foreign exchange, political factors, trade agreements etc. It is not concerned with what resulted in change rather deals with actual changes. It works on the assumption that price can take only one of the three directions:

&#61607; Upward
&#61607; downward
&#61607; sideward

• It rest on those market patterns that have been identified as significant. That means those factors which are repetitive in nature or will produce desired results.

• History always repeats itself as human psychology changes very slowly with time. That is market movements are predictable.



It takes into account the ratio of upward and downward movements in index and expresses it in the range of zero to hundred.


Charts include various hills, slopes, curves that develop on a chart over a time and reflect some major and minor changes in pattern. Some of the chart formations include:

• V


A gap represents area on a bar chart where no trading took place.

• UPGAP: it is formed when the lowest price on a particular day is more than the highest price of previous day.

• DOWNGAP: it is formed when highest price of a certain day is less than the lowest price on previous day.


Various number theories are used in technical analysis like:

• Fibonacci theory


This indicates the overbought or/and undersold condition. It uses a scale of zero to hundred percent.


It is the one where current economic, political, financial situation of the country of currency is studied. A country’s economical and political condition depends upon many factors like the interest rate, unemployment level, exports and imports, per capita income, percentage of population living above and below the poverty line, inflation, trade relations with other countries, tax policies etc.

A fundamental analyst studies and evaluates all these factors before coming to any decision. Thus it helps in long tem decision making and making profits in short term by extra ordinary developments.

Some of the indicators that help in fundamental analysis include:


It reflects total market value of all the goods and services produced in a country during a given year.


This reflects total receipts by all the retail stores in a country.


It reflects change in prices of consumer goods.


It reflects various phases through which a business passes. These phases include:



It controls the supply of money in an economy.

Trading successfully needs knowledge, time and understanding of a market. You cannot earn continuously in a Forex market due to its volatile nature. Thus as a trader you should try to consider both technical and fundamental strategies of forex trading and make decision based on market expectations and trends. Try trading with money that you can afford to loose without any regrets. Trade with logic and if you are not sure quit and take rest for some time.

Kamis, 14 Oktober 2010

A Quick Guide To Understanding Your Individual Retirement Account

It's never too early to begin preparing for your retirement and one of the best ways to prepare is to set up an Individual Retirement Account (often referred to as an IRA).

The purpose of an IRA is to serve as a personal tax-qualified retirement savings plan. Anyone who works, whether as an employee or self-employed, can set aside a set amount in an IRA, with the earnings on these investments tax-deferred until the date of distribution. In addition, certain individuals are permitted to deduct all or part of their contributions to the IRA. Plus, as of 1998, certain individuals can also set up Roth IRAs, to which contributions are not deductible, but from which withdrawals at retirement won't be taxed.

It doesn't take much to set up an IRA. The trustee (or custodian) can be a bank, mutual fund, brokerage house or other financial institution. You cannot be your own trustee. An IRA can be established and a contribution made after year-end, no later than the due date for filing the income tax return for that year, not including extensions. This generally means that you have until April 15th of the following year to make the contribution and deduct it on your tax return.

The most you can contribute to an IRA in any single year (as of 2006) is the smaller of $4,000 or an amount equal to the compensation includible in income for the year. Those 50 years old and above will also be allowed to make additional $1,000 catch-up contributions to an IRA each year to help them save more for retirement.

The same limit applies even if you have more than one IRA, or more than one type of IRA. When both you and your spouse have compensation, you can each contribute the maximum, which means $8,000 total ($10,000 if you are both 50 or over). In 2008, IRA contribution limits will be raised to $5,000, while the catch up contribution for those 50 years old and above will remain at $1,000.

You do not have to contribute the full amount allowed every year. You may skip a year or even several years. You may resume making contributions in any subsequent year, but you cannot add additional funds to make up for those years when no contribution was made.

Contributions must be from compensation. This can be from wages, salaries, commissions and other sources of earned income. Contributions do not include such things as deferred compensations, retirement payments, or portfolio income from interest or dividends.

You can contribute more than the allowable amount, however, a 6 percent excise tax penalty will be assessed.

No contributions may be made to an inherited IRA, in a form other than cash, or during or after the year in which the individual reaches age 70.5.

You must begin taking distributions from an IRA no later than April 1st of the year following the year in which you reach age 70.5, or the year in which you retire, whichever is later.

This is a quick and general overview of IRAs. The rules are slightly different for Roth IRAs, which have their own contribution and distribution limitations. Before setting up an IRA, take the time to talk to your banker, accountant, or financial advisor to make sure you have a firm grasp on your options and set up the IRA which best serves your personal needs.

You can learn more about IRAs online from the Internal Revenue Service here: http://www.irs.gov/taxtopics/tc451.html

Rabu, 13 Oktober 2010

Disability Insurance Online

What is Disability Insurance?
“The Social Security and Supplemental Security Income disability programs are the largest of several Federal programs that provide assistance to people with disabilities. While these two programs are different in many ways, both are administered by the Social Security Administration and only individuals who have a disability and meet medical criteria may qualify for benefits under either program.”
-    Social Security web site, June 2006

The Social Security office will want to check your medical history to be sure you qualify for disability benefits.  The Social Security office is one way to get disability benefits, but in most cases these benefits will not be substantial enough for families.

Disability insurance can be obtained through any number of insurance companies.  In the event that you are disabled, this insurance will serve as financial protection.  You will receive a percentage of your gross income from your disability insurance policy, income that will ensure your own financial safety. 

You do not have to go through the Social Security Office to take out a disability insurance policy, nor to receive the benefits from that policy.  The Social Security disability program is not related to any disability insurance policy that you take out.

“Individual disability insurance is truly a basic concept. It is an insurance product designed to replace anywhere from 45-60% of your gross income on a tax-free basis should a sickness or illness prevent you from earning an income in your occupation. Every disability insurance policy from every insurance company is very different, this is not a product to simply shop for the most competitive rate. To buy the cheapest disability insurance policy on the market is to throw money away. The odds of getting paid a monthly benefit under a cheap contract may be significantly lower than receiving benefits from a quality contract.”
-    About Disability Insurance web site, June 2006

Types of Disability Insurance
Most people are familiar with two types of disability insurance: short-term disability, and long-term disability.  Short-term disability insurance is included as part of a benefits package with many different employers, and usually provides an income in the early part of disability.  Short-term disability insurance generally provides coverage for a  period of several weeks, and does not exceed a two-year term.

Long-term disability, however, can last for a  period of several years.  These types of policies may be included as a part of employment, in a benefits package, but many purchase these disability insurance policies individually. 

As far as disability insurance goes, however, there are still more policies to learn about.  One type of disability insurance is the Own-Occupation Disability Insurance.  The definition of this policy reads:

“The inability to perform the material and substantial duties of your regular occupation, the insurance company will consider your occupation to be the occupation you are engaged in at the time you become disabled, they will pay the claim even if you are working in some other capacity.”

Another kind of disability insurance is the Income Replacement Insurance.  This is a very popular type of disability insurance, and most insurance agents are familiar with this policy.  The language of this type of disability insurance reads:

“Because of sickness or injury you are unable to perform the material and substantial duties of your occupation, and are not engaged in any other occupation.”

Common in employee benefits packages, Gainful Occupation Coverage is another popular form of disability insurance.  The language here is worded very carefully:

“Because of sickness or injury you are unable to perform the material and substantial duties or your occupation, or any occupation for which you are deemed reasonably qualified by education, training, or experience.”

Selasa, 12 Oktober 2010

Disability Insurance

Disability can occur at any time. While many people take their body and health for granted, serious accident or injury can happen to anyone and if you find yourself disable, for a short period or long term, how will you cope?

Disability insurance is a sub set of health insurance that will provide the holder with income should they become disabled and thus unable to continue earning a living. If this were to happen to you, do you know what you or your family would do for income?

If you are aged 40, there is a higher chance that you will be disabled, and thus unable to work for a period of 90 days or more, than of you dying before the age of 65. There are three common ways of insuring against this risk.

<b>Employer’s Insurance</b>

The first is to receive insurance from your employer. This is required by law in many states. It comes as a form of short or long term paid sick leave. Larger employers can have even more generous terms. For example, a common policy might offer you 60% of your salary for five years, or maybe even all the way up to retirement. While not everyone is lucky enough to work for such a company, it is worth checking with your employer to find out what your protection is and whether or not its something you wish to provide for yourself.

<b>Long Term Disability</b>

The second common protection against this type of risk is social security and disability benefits. This usually only covers employees whose disability lasts for a period of 12 months or more. It also must be shown to be so severe that you cannot find gainful employment. Therefore there are some gaps here that you may be more comfortable providing for with private insurance.

<b>Individual Policies</b>

The third method of dealing with this risk is with an individual disability insurance policy. This means taking out a private insurance policy yourself. You should shop around to make sure you get the best deal available, but at least you will have the peace of mind of knowing in what circumstances you are covered and what the terms of the policy cover.

There are some other sources of protection. Workman’s compensation policies will sometimes step in to cover you if the injury occurred at work. Auto insurance may provide coverage if the injury occurred in a car accident and the Department of Veteran’s affairs can advise you if you think the disability is related to service in the armed forces.

Senin, 11 Oktober 2010

Dipping into your State Health Insurance Pool - What Are The Requirements?

State health insurance is a branch of health insurance that is for high-risk individuals with chronic and/or pre-existing conditions. Most common diseases to see on this type of insurance are HIV, AIDS, kidney disease, obesity, and diabetes. This high-risk pool is designed to act as a safety net to offer some form of insurance to these people but for a hefty premium.  This program has fewer participants due to the cost. This plan is not low-income friendly. Rates can be as much as double what the normal market value for health insurance is. The pool does tend to offer better benefits but is definitely geared to those people that truly afford insurance. So, most people who fall under this category and require this type of plan are likely to be uninsured due to not being able to afford a plan. This plan is last resort for persons with such illnesses that land them for emergency or hospital care frequently, and it that case pays for itself quickly. Some of the few persons who cannot afford this are lucky enough to have a spouse in the work place that is able to add them to their policy from their employer, these plans cannot discriminate due to chronic or long-term illnesses. The State Health Insurance Pool knows its rates are high, and claims so are medical costs for the chronically ill. They have to charge more to be able to get ahead and stay afloat.

Most risk pools are nonprofit associations ran by the state. Usually they do not use taxes to operate their business. Most persons requiring this type of service usually are filling up the gap in cost of what their normal plan won't cover or is a temporary pit stop till they can find a plan that accepts them at a lower cost. The people who qualify for this type of coverage must be a resident of the state they are applying in. Most states require you live there for at least six months and some up to one full year before reaching residency status. You also need one of several possible documents from other insurance companies. You will need proof of rejection from at least one company denying them benefits similar to the ones being asked for. You can use proof of insurance with a higher premium as well. You may also be eligible if you can show proof of insurance with a rider or rated policy. Any of the above mentioned could get you approved to apply for the risk pool in the state you reside in. A reciprocity agreement is when a person who is eligible for the plan and is currently on a similar plan, met the waiting period quota, and not used up the lifetime maximum benefits can still be eligible if they move to another state after they meet the residency requirement. Not all states, but most, have this agreement included into their plan.

There is a list of those who are not eligible in the high-risk pool besides non-residents. You are no longer eligible if you move to another state but if you have a reciprocity agreement, you can become eligible in the state you now reside after residency has been established. Most people who are eligible or receive Medicaid or Medicare are also not eligible. Many states do have a high-risk plan for Medicare eligible persons, but if you receive or could receive Medicaid than you don't qualify. If a person has terminated their coverage in another plan and less than 132 months have passed they are not eligible for the pool till that time is up. Those who have used their maximum lifetime benefits for their plan are also not qualifying. Inmates of a public institution are also not eligible for the risk pool. Other specific exclusions can include state decided specific diseases or medical conditions that they just don't want to cover. An enrollment cap may also be in affect so only a specific amount of persons may be actively enrolled at any given point of time. All other applicants who are eligible will be placed on a waiting list till there is an opening. There seem to be a higher list of those who don't qualify then who do for this high-risk benefit that costs an arm and a leg anyway.

Minggu, 10 Oktober 2010

Different Types of Health Insurance in California

Whether you buy group or individual health insurance in California, the options you have regarding the different types of health  insurance are generally the same.   In some groups you can even choose from available plans. These different types are  <strong>traditional health insurance, health maintenance organizations (HMOs), and preferred provider organizations  (PPOs).</strong>

California goes beyond the Federal requirements for offering health insurance to its residents.  Examples of this include Industry  Advantage plans (IAHP), short-term health policies, Insurance for high risk Individuals and special plans for children and teens.

<strong><u>Additional Health Insurance in California</u></strong>
The traditional health care delivery system is based on a fee-for-service type of arrangement. In a fee-for-service system, you pay  or each itemized medical service you receive. In the days of the frontier, "Doc" often received a chicken as payment. Today,  physicians are paid with money, lots and lots of it. Fee-for-service health insurance recognizes this practice and is designed to  reduce or even eliminate your duty to pay directly for your medical care. Traditional health insurance comes in three parts:

<strong><u>California has four basic options for choosing a health care plan:</u></strong>
<li>1. Health through an employer or association</li>
<li>2. Health Insurance through Income eligibility such as Medicaid</li>
<li>3. Health care for high risk individuals such as those that have had cancer or a heart attack</li>
<li>4. Private Insurance</li></ol>

Hospitalization covers defined expenses incurred while in the hospital. Generally, the insurance will pay for all of the covered  services rendered by the hospital staff. However, if the insurance benefit is an indemnity payment, the payment will be for a fixed  sum regardless of the actual expenses incurred. This fixed sum will usually be far below the daily charge actually made by the  hospital.

This part of a traditional health plan covers the expensive costs of medical care other than the bill from the hospital. Services  such as doctor visits, treatment charges, etc., are covered here. Medical/surgical usually has a deductible and requires  co-payments by the insured (payments you make for charges not covered by the insurance), typically 20 percent of the doctor's fee.

<strong>Catastrophic or major medical</strong>
There are usually lifetime maximum payments that hospitalization and medical/surgical plans will pay, after which the well runs  dry. Unfortunately, these maximums may not be sufficient to pay for all of the care required if a major illness or injury should  strike, since such afflictions can eat up hundreds of thousands or even millions of dollars worth of health services. Thus,  catastrophic coverage adds to your umbrella of protection in an amount sufficient to protect you from the horrendous expenses of  such serious and prolonged illnesses. These policies also fill in some of the gaps not covered by hospitalization or  medical/surgical.

<strong>Health Maintenance Organizations or Private Insurance in California</strong>
The health maintenance organization (HMO) is a relatively new player in the health insurance game, although it has been around in a  limited fashion since the 1930s. The idea behind an HMO is to pay one premium and receive all of your health care at no or a  nominal additional cost. The point is to save money compared to traditional health plans that cost more to purchase and require  more out-of-pocket payments from the insured. What you, the insured, give in exchange for reduced cost is a substantial loss of  your freedom to choose who will take care of your health needs.

<strong>Preferred Provider Organizations</strong>
Preferred provider organizations (PPOs) seek to give both the benefits of traditional health plans and the money savings of HMOs.  They do this by paying higher benefits as a reward for your using the doctors or hospitals they preselect for that purpose.

<strong>Disability Insurance</strong>
Disability insurance does not pay for health care; rather it pays for lost wages caused by a disabling injury or illness.

<strong>How Health Insurance Is Priced</strong>
Ask anyone how health insurance is priced and you will get a simple answer: expensively! Beyond that, there are underwriting  criteria used by health insurance providers, whether they are for-profit or, like Blue Shield/Blue Cross, nonprofit.

<strong><u>Underwriting Criteria</u></strong>
The older you are, the more likely you are to get sick; therefore, the higher your health insurance premiums will be.

<strong>Number of people covered</strong>
Many people buy family coverage rather than individual policies. This means that there will be adults as well as minor children  protected by the same plan. Some companies will charge based on the size of the family. Others charge a basic family rate without  regard to the number of members.

Unlike life insurance, where women get the better end of the bargain than men, in health insurance women often pay higher premiums.  This is based on health insurance industry statistics which indicate that the female of the species tends to need medical care more  often than the male.

<strong>Health history</strong>
Insurance operates on statistical probabilities. If you have had a poor health history, statistically you are more likely to have a  more expensive health care future. This, in turn, means that you will pay higher premiums-if you can get health insurance at all.

The more likely you are to suffer injury or illness because of the work you do, the more likely the health insurance industry will  be to charge excessively for benefits. This may be well and good for professional deep-sea divers.  But the industry has begun to  stretch the concept into areas that have nothing to do with the inherent danger of the work.

In your application for health insurance you will be asked questions about your personal habits. Your answers will have a lot to do  with the cost of your premiums. If you smoke, you will probably pay more for health insurance. If you drink to excess, you will  probably pay more for health insurance. If you are known to be under a great deal of stress, you may pay more for health insurance.  California does reward the health care Insurance consumer with lower premiums if they have practiced good health policies.

One of the most important things you can do as a health care consumer is to engage in preventive care. Not only will you be able to  spot serious diseases at an early stage, thereby increasing your chances of effective treatment and cure, but you should be able to  save money as well, since it is usually far less expensive to treat a disease when it's a molehill rather than a mountain.

<strong>About The Author:</strong><br />
Medical-Ins.com is a leading broker of <strong>health insurance in California</strong>.  We provide detailed information and cost breakdowns of <strong>Blue Cross</strong>, <strong>PacifiCare California</strong> and many more.  Visit  our site for a free quote and to help sort through the various health insurance plans to find the more affordable option for your  family.