Archive for: ‘June 2014’

Retirement Made Easy With Mutual Funds

June 30, 2014 Posted by admin

With the advances in healthcare and science, people are more than likely to live beyond 65. However without a fixed income every month, living beyond retirement is becoming quite the task. In such cases, it is always best to start financial planning long before you actually have to retire. Keeping in mind that inflation continually challenges the purchasing-power of whatever money we do have in our hand, planning for a time when there is no steady inflow of money seems like the only smart way to live. While setting aside a small part of our income, or even saving half of our daily wages may seem enough for our non-working years, the market is always volatile. Saving half of our earnings may be enough today, but tomorrow we might need more. In order to take care of the amount of money we are likely to require in the future, investing may be our only option. However, the risk of investing is no secret, so how exactly do we find a fairly safe investment to ensure a better retired life?

One of the ways in which we can work towards a secure future is by investing in mutual funds. One of the biggest benefits of mutual funds is that they have a lower risk as compared to individual stocks and bonds. This is because in these funds, the investment is diversified and many people invest in a single fund. Apart from the low risk, investing in a fund means that a professional will help overlook the investment process. This means that we ourselves need not spend every morning buried in the business pages of the newspaper. Your share in a mutual fund investment can also be liquidated at any time, so there is no risk of your money being kept out of your reach, should you need it at any point of time. However, it is important to remember that an investment is never without risk, and mutual funds are no exception to the rule. Even though these funds are managed by professionals, these professionals may also make mistakes. Therefore it is always best to double check your investments before finalising anything.

Mutual Funds in India were introduced as early as 1963, and financial agencies came up with their own funds from 1987. The growth since then has been phenomenal, and today almost all financial institutions across the nation have their own funds. However, the mutual fund market in India is still not utilised well by the people. While the reasons for this may be several and varied, we must remember that we still need our futures to be secure. So take some time to read more about mutual funds and then invest in them.

Mutual Funds for Inexperience Traders Review

June 28, 2014 Posted by admin

Investment funds have been around for over two hundred years, and some say even more than that. Having survived so long that it must provide an investment that people really like. And as its popularity grew, so the number of different funds. So what are the mutual funds and why people love so much?What is a mutual fund?A mutual fund is a comprehensive account of large stocks of many different companies. Or it may be a complete list of the major bond many different companies. Or maybe a complete list of stocks and bonds large many different companies. You get the idea. And they are all U.S. companies, or may be from any country in the world. As I said earlier, because they have become more popular, such as different types and styles.The popularity of mutual fundsSo why do people like them so much? A few years ago one of my favorite stores were Montgomery Wards. Most of the furniture in my house was bought there. Seen something around Montgomery Wards lately? The camcorder I use for movies with my grandchildren, was purchased at Circuit City. I had a lot on this, maybe he was too good deal. Their shops are long gone.What Montgomery Wards and Circuit City have to see how people like mutual funds now? Both companies are just one example of why people do not like the risk of buying shares in a company. You are shopping in a store and actually this company.So you decide to buy some of their stock and watch it grow. You make purchases as soon forget and one day you hear the shutter stores. It is too late for the time of sale, and hope to reach equilibrium.While mutual funds are certainly a risk with them, much less than owning shares in a company in the background. The funds are large enough and have spread their purchases for a company is not going under the sink. This diversification of risk is a comfort for most people.Like mutual funds come in all shapes and sizes that are different risks associated with different agents. Public services have been around for a while and more than likely will be around for years to come. The government regulates and monitors these companies are very strict. dot-com companies in 1990 were new to the scene, and most were not very lucrative. The risk associated with a utility fund was much less of a mutual fund that consists of Internet start-ups in the 1990s. You can not just jump in with both feet and start buying mutual funds without a little research. A little Web surfing to help verify the funds and the risks associated with each.Fund Account ManagerAnother reason why people flock of professional investment funds. Fund managers have the experience, training and tools to analyze the market on a daily basis and adapt the necessary funds. They want the fund to do well, so that they grow and make more money. This is just another peace of mind for buyers of the fund.Easy to buy mutual fundsMost investment funds to accept a lump sum to start. And then you can make additional payments or a lump, you can set a weekly or monthly contribution. Easy flow and investment funds will also help to make it very popular.So you can buy easily, feel comfortable with the risk diversification and also know that a quarter of professional fund managers on your investments. That is why mutual funds are popular and growing.My point of viewAfter years of investing in the stock market finally realized my wallet was no need for product diversification. Looking at all the options I decided to invest in commodities commodities fund was the best decision. Please visit our site, whether the activity of mutual funds are a good fit for you.

A Lucrative Alternative to Mutual Funds

June 27, 2014 Posted by admin

Why is it that your mutual fund advisor will get rich off of your investments before you do? More importantly, what can you do to stop the flow of your capital into your advisor’s pocketbook? Rest assured that there is a better and more lucrative alternative for you.

So how is it that your advisor is claiming your hard-earned savings for his or her own? In a nutshell, the mutual fund industry is made up of an extensive network of salespeople who are paid to “advise” you on where to place your investment dollars.

In doing so, these salespeople benefit from “their” hard work by tapping into your investment capital over the lifetime of having you invest with them. This is done through a combination of one or more of the following drains on your capital and earning potential:

1. Trailing commission: Your advisor is paid a certain percentage in the range of 0.25% to 0.50% of your total investment per annum. This monetary incentive encourages advisors to “hang on” to their clients. As your mutual fund portfolio grows in value over time, it means that your advisor that initially sold you the investment is making even more and more money.

2. Front-end loads: These fees are paid to financial planners, brokers and advisors as sales commissions. The fees are deducted from the investment amount, which results in lowering the size of your initial investment.

3. Back-end loads: These fees are paid by the investor when selling mutual fund shares within a specified number of years, usually five to seven years. The fee is a percentage of the value of the mutual fund shares being sold. This fee can be as high as 7% within the first year of withdrawal. The fee percentage is highest in the first year and decreases yearly until the specified holding period ends, at which time it drops to zero.

4. Management Expense Ratio (MER): I’ve saved the best to last. The mutual fund company charges management fees in the typical range of 1% – 4% per annum to cover their expenses. A MER of 2% doesn’t look like much; however, it represents a 25% loss in growth potential if the portfolio only managed a typical stock market annual return of 8%. Yikes! That’s a big hit to the pocketbook over time.

You can see how your advisor could potentially end up retiring before you do thanks to your efforts.

How can you re-claim what is rightfully yours?

With a little education and effort on your part, you can benefit immensely from the increased growth potential for your stock holdings. By setting up a portfolio of self-directed investments, you not only have a greater chance of being a more successful investor financially, you also will gain greater confidence and control over your investment portfolio.

Let me ask you this question: Would you rather pay $5 – $20 for each of your stock purchases or hand your money over to a mutual fund manager who will take 1% – 4% of your portfolio each and every year, whether your investments go up or go down?

Start by empowering yourself to become a better investor. Take a look at various stock investment websites that focus on educating the novice investor. Pick up a couple of basic stock investment books or audio books that will walk you through each aspect of investing step-by-step. Within a short period of time you will build your level of confidence to a point where you will be wondering why you hadn’t taken this path to greater wealth creation sooner.

Investment Diversification with Commodity Mutual Funds

June 25, 2014 Posted by admin

As the old saying goes, don’t put all your eggs in one basket. The same is true with your money. Don’t put all your investment money in one stock, or even the same sector of stocks. Investment diversification is an easy concept to understand. What’s not easy is deciding where to spread your money. And for various reasons most people don’t consider commodity mutual funds.

Most people tend to put all their investment or retirement money in the stock market. They either invest in the company they work for, or buy stocks of companies that they like, such as Ford, GM, Wal-Mart, or any company that is popular. Or they are using a brokerage house for advice and pick and choose from the brokers suggestions. If they have a large sum of money in investments, they probably have a financial counselor. This advisor should have some of their money in the bond market, which is a good, sound investment diversification strategy.

The stock market is easy to understand and most people are comfortable with checking their stock’s performance online. The bond market is a little tougher to follow day to day, and most people just buy the bond and wait for their broker or adviser to recommend a change.

The commodity and commodity mutual fund market is a little tougher to follow and to understand. The prices of gold and oil are easy to follow because they are a couple of the most popular commodities. The prices of corn, cotton or pig bellies are not so popular. Unless you are a producer or buyer of these commodities you probably don’t have a clue what their price is.

But commodity mutual funds are a great tool to add investment diversification to any portfolio. They offer investment protection from inflation, a weak dollar and swings in the stock market. Over the last few years, there has been a large increase of investing in commodity mutual funds do to the bad performance of the stock market.

With the large amount of choices in the stock and mutual fund market, stock brokers usually do not research or recommend commodity mutual funds. They probably have hard enough time pushing their stock pick of the day, let alone trying to sell commodity products. For that reason, you need to do your own research into commodities and commodity mutual funds. They can add value to your retirement fund.

After years of investing in the stock market I finally realized my portfolio needed some diversification with commodities. Looking into all the possible choices of investing in commodities I decided commodity mutual funds was my best decision.

Factors To Consider Before Choosing Your Commercial Financing Product

June 21, 2014 Posted by admin

Understanding the specific need for which you seek finance is extremely important. For example, you might need finance to boost your working capital, for buying equipment, for buying or leasing land, etc. You also need to look at the current status of your business and its assets to understand how much of an interest rate and security requirements you will be able to meet and tailor your finance product accordingly. We have discussed the most common types of finance that businesses access to help you get a grip on the basics.

Factors to Consider While Choosing the Right Type of Financing

The type of financing your business needs depends on you need it for short term, medium term or long term. It also depends on the reason you need it for; for example, to enhance the working capital, to purchase plants & equipment, etc. Depending on the reason and the time of availing it, the finance that you access could be of different kinds. It could be an overdraft for working capital, leasing finance for equipment, one time up-front loan, etc.

One more important consideration while deciding on financing is to understand the rate and security requirements of the loan. You need to thoroughly understand what kind of interest and security you can afford given the present status of your business and assets. Depending on your business needs, you can select the right option for you.

Different Types of Financing That Are Available

We will discuss different types of debt financing that you can avail for your business needs. We have divided the different types based on the broad needs/nature of the business:

For short term, seasonal or immediate working capital requirements:

Overdraft: While availing overdraft, ensure that the overdrawn balance moves regularly into credit and be prepared to return the overdrawn amount as demanded by the bank.

Commercial bills of exchange: It is Important to remember that the applicable interest has to be paid in advance and the bills are highly sensitive to interest rate fluctuations. � Factoring: The business needs to have a strong credit sales history with clients that are credit worthy.

For leasing of equipment, plant and vehicles:

Leasing finance: The good part is that working capital is not affected and no security is needed separately, since the asset becomes the security by default in most cases.

For purchase or acquisition of land, plant, equipment, vehicles, assets:

� Hire purchase and asset purchase finance: A capital deposit is required and hence it draws on the working capital

� Term loan: Mostly availed for purchase and setup costs of new business. Remember to negotiate the repayment schedule according to the cash flow of the business.

� Personal instalment loan: These are usually applicable for relatively low finance amounts for purchase of vehicles, equipment, etc. security may or may not be required.

� Mortgage loan: Mostly availed to purchase fixed assets like land, office space, etc.

For importers and exporters:

� Trade Finance: Facilitate overseas transactions. It may be good to avail the advisory services of your lending institution/bank regarding the creditworthiness of the overseas client.

Single Invoice Finance The Options Explained

June 17, 2014 Posted by admin

Single Invoice Finance or financing are terms that are often used to cover a number of different requirements such as:

1) Funding just one sales invoice in a one off transaction.
2) Selective Invoice Finance – selecting particular invoices to receive funding against.
3) Spot finance, spot factoring or spot discounting.
4) Single debtor finance – funding against just one debtor.

Each of the four options above are explained in turn below.

Single Invoice Finance

As the name suggests in some cases you can raise funding against just one single invoice. Some of the invoice funding companies will consider this if the circumstances are right i.e. the transaction size, the quality of the debtor and the nature of the debt. There are also a number of invoice auction platforms that will allow you to attract funding against single invoices or batches of transactions. This type of facility often appeals where client’s don’t want to be tied into a contract for any period of time but the cost of such funding will vary vastly between different providers.

Selective Invoice Finance

Some customers don’t just want funding against one single invoice, what they want is to be able to pick and choose which invoices they will receive funding against. This also allows them to control the cost of the facility. There are a variety of funding companies that will provide this kind of facility.

Spot Invoice Finance, Spot Factoring & Spot Invoice Discounting

“Spot” facilities could also be termed as “selective” and work as described above. “Spot factoring” includes a credit control service whereas “spot discounting” is just funding where the client handles their own credit control. “Spot invoice finance” would technically include both factoring and invoice discounting however the term is commonly used to describe “spot invoice discounting”.

Single Debtor Finance

Rather than finance against just one transaction, “single debtor finance” is funding against just one single customer or debtor. In some cases clients only have one single customer which is not a problem for some financers and depends upon the quality of the end debtor to a large extent combined with the nature of the sales. Some clients may want to select just one debtor of many against which to receive finance. Again this is possible although not all invoice finance companies will offer this type of flexibility.

The Alternative Option To Single or Selective Facilities – Whole Turnover

Just to complete the options it is worth mentioning the more mainstream alternative, whole turnover invoice finance. As the name describes all the sales of a business fall under the facility and hence funding is against all eligible invoices. This can dramatically boost the amount of funding raised and there is a cost advantage in financing all your sales, a kind of bulk discount if you like. In some cases funding just single transactions or selected invoices for small periods of time can be proportionately more expensive you need to consider your requirements and the option that is likely to be best for your business.

Does It Pay to Re-Finance

June 10, 2014 Posted by admin

This is a question many homeowners may have when they are considering re-financing their home. Unfortunately the answer to this question is a rather complex one and the answer is not always the same. There are some standard situations where a homeowner might investigate the possibility of re-financing. These situations include when interest rates drop, when the homeowner’s credit score improves and when the homeowner has a significant change in their financial situation. While a re-finance may not necessarily be warranted in all of these situations, it is certainly worth at least investigating.

Drops in the Interest Rate

Drops in interest rates often send homeowners scrambling to re-finance. However the homeowner should carefully consider the rate drop before making the decision to re-finance. It is important to note that a homeowner pays closing costs each time they re-finance. These closings costs may include application fees, origination fees, appraisal fees and a variety of other costs and may add up quite quickly. Due to this fee, each homeowner should carefully evaluate their financial situation to determine whether or not the re-financing will be worthwhile. In general the closing fees should not exceed the overall savings and the amount of time the homeowner is required to retain the property to recoup these costs should not be longer than the homeowner plans to retain the property.

Credit Score Improvements

When the homeowner’s credit scores improve, considering re-financing is warranted. Lenders are in the business of making money and are more likely to offer favorable rates to those with good credit than they are to offer these rates to those with poor credit. As a result those with poor credit are likely to be offered terms such as high interest rates or adjustable rate mortgages. Homeowners who are dealing with these circumstances may investigate re-financing as their credit improves. The good thing about credit scores is mistakes and blemishes are eventually erased from the record. As a result, homeowners who make an honest effort to repair their credit by making payments in a timely fashion may find themselves in a position of improved credit in the future.

When credit scores are higher, lenders are willing to offer lower interest rates. For this reason homeowners should consider the option or re-financing when their credit score begins to show marked improvement. During this process the homeowner can determine whether or not re-financing under these conditions is worthwhile.

Changed Financial Situations

Homeowners should also consider re-financing when there is a considerable change in their financial situation. This may include a large raise as well as the loss of a job or a change in careers resulting in a considerable loss of pay. In either case, re-financing may be a viable solution. Homeowners who are making considerably more money might consider re-financing to pay off their debts earlier. Conversely, those who find themselves unable to fulfill their monthly financial obligations might turn to re-financing as a way of extending the debt which will lower the monthly payments. This may result in the homeowner paying more money in the long run because they are stretching their debt over a longer pay period but it might be necessary in times of need. In these cases a lower monthly payment may be worth paying more in the long run.

What Rims Financing Give You

June 10, 2014 Posted by admin

What Rims Financing Give YouYou all have probably come across or heard the term rim financing-what it is and how it works. Principally, rim financing is a way for people to procure or obtain wheels they need for their car at the most affordable prices. Car owners can look for a company which offers such financing. This would enable them to look for the best and low priced wheels which would instantly fit your budget. As a result, it would be easier for you to change your rims and tires. If you are wondering how you can finance your wheels through these companies, you need to meet some of their criteria. One of the mandatory requirements is that you should be of legal age to enter into such transactions. That is, you should at least be 18 years old to be financed. Some financing companies, however, would require you to be at least 21 years old. So, if you are 18 years of age, look for the company which sets such age. Second, you are the valid owner of the car. Last, you need to present your valid driver’s license. Some of the requirements may also vary depending on the company you choose. For people who are worried about their credit rating, it is advisable that you choose a financing company which does not require you to have good credit standing. There are a number of companies which specializes in bad credit ratings. If you are one of the people who are currently experiencing financial problems and is currently having a bad credit rating, choose to finance your wheels with them. You can get instant approval with them. The benefits of such financing service are also undeniable. If you choose to finance your wheels, here are some of the benefits you can get from it: Easy and low payments. Financing companies guarantee you easy and low payments. Monthly payment rates can be as low as $65. You get to own your wheels by paying such small amount of money per month. Stylish rims. Choosing to purchase your rims and tires with financing companies gives you the opportunity to choose the most stylish rims. They offer you at least 2,000 rim styles and brands to choose from-from the most unique to the most popular, you name it, they have it. Quality wheels. Over and above stylish rims, with wheel financing, you get the best quality wheels. These financing companies offer you superior rim and tire brands. You only get the superior wheels at the most affordable prices. Get the long-lasting wheels for your tire from these financing companies. Rim and tire packages. If there was one popular feature financing companies can be proud of, it is with wheel packages that people can save money and own quality wheels. Wheel packages made purchasing such wheels cheaper. If you want to purchase wheels which would give you greater benefits, rims financing is the way to go! Purchase and own quality and discounted wheels and enjoy the benefits from it!

Exchange Traded Funds vs. Mutual Funds

June 9, 2014 Posted by admin

Exchange Traded Funds (ETF) are one of the fastest-growing and most powerful investment tools, since their debute in the US Market in 1993. ETFs play an important role in the US investment revolution that began in 1924, when the first Mutual Fund was introduced to the investment marketplace. Like Mutual Funds, ETFs are well-diversified baskets of securities, which provide investors with a broader exposure to particular investment styles across particular industries with just a single investment. However, before investing in ETFs, it is very important to understand how they work and what makes them so attractive and different from Mutual Funds (MFs).

Actively Managed Funds

Each mutual fund hires a manager, who not only makes all the choices regarding the stocks within the investment basket, but also takes care of investors’ needs. When you decide to invest your money in the fund, fund’s manager has to create new shares to meet your purchases, and to sell existing shares to meet your redemptions. Most funds charge you one-time fees such as a front-end load (up to 8.5 percent) and a back-end load (up to 6.0 percent) to enter and exit the fund, as well as ongoing 12b-1 operating fees (up to 1.0 percent). Currently, the average annual expense ratio for traditional funds is 1.67 percent.

Passively Managed Funds

One of the main reasons for the popularity and high competitiveness of an ETF in the investment landscape is its lower fees. Unlike traditional funds, ETFs has no front-end and back-end loads. An ETF is a passively managed, low cost alternative to Mutual Funds. There is a predetermined set of rules that are used by the fund’s sponsor to govern the stock selection. An ETF is traded on a stock exchange. The investor only has to pay a trading commission to the brokerage firm through which the transaction is executed. Nowadays, the increased competition among brokers has significantly lower the cost of trading ETF shares. However, each ETF pays a sponsor an average fee of 0.27 percent to run the fund, which slightly reduces the return on investments, but is still much lower than the average annual fees a Mutual Fund faces.

The Negative Aspects of ETFs

The information above is thoroughly in favor of ETFs. ETFs have many advantages and just a few disadvantages over traditional Mutual Funds. The advantages mainly range from low investment cost to increased trading flexibility and investment transparency. However, being a prospective investor, you should not overlook the whole picture. The fact is that no-load Mutual Funds exist and they charge you only 12b-1 operating fees, ranging between 0.2 and 1.0 percent. This means that it is very likely in some cases your transaction costs to be greater with an ETF than with no-load Mutual Funds bought directly from the fund company. Another drawback that can arise is that ETF share prices are subject to supply and demand shifters. This creates a risky trading environment that is nonexistent with Mutual Funds. As a result, when investing in ETFs, share prices can differ slightly from the market value of the fund’s underlying holdings. Exactly like any other shares of stock traded on the stock exchange, the price a buyer pays is usually higher than the price a seller receives.

Mutual Fund – Investment Option

June 9, 2014 Posted by admin

Mutual funds are one of the best investment options for small investors. By investing in it, investors are able to diversify their investments and earn excellent returns. For those wanting to invest in top mutual funds, there are two ways of determining what constitutes a top fund. One way is to focus on fund houses that have very attractive investments. Some examples of popular fund houses with attractive investments are Birla Sun Life, HDFC, ICICI Prudential, Reliance and UTI Mutual Fund. Another way to determine top funds is by looking at fund houses that have the best rated funds in offering.

It is important to note that a fund house may be a top mutual fund with respect to gathering assets, but it may fall behind in terms of performance. It is also important to understand that investment decisions should be made on the basis of performance, rather than popularity. Other aspects to take into account when selecting mutual funds are the reputation of the fund house, the asset under management of the scheme, and the past performance of the scheme. Based on the investor’s risk profile and goal, the investment will be made in equity, debt and gold funds.

The demand for it is high because of the many benefits of investing in such investment vehicles. For starters, one benefit of it is professional expertise. Fund managers are extremely qualified and have lots of experience. They understand the economic and sector indicators and track the market closely. This places them in a good position to make investment decisions. Another benefit of it is asset allocation. Investors can allocate their money in various asset classes, based on their goals, horizon and risk appetite. It also have the benefit of risk diversification. Investors can diversify their risks across asset classes, industries and companies. This type of investments also have the advantage of liquidity. Such investments are highly liquid. This means fund units can be sold on any business day. The money gets credited to the investor’s account within one or two business days. Mutual funds are also affordable. They are perfect for investors who have a small amount to invest. This type of investment is also tax efficient. Dividend received from it is tax-free for investors. With all these benefits, it is easy to see why they are so popular.

Investment in it somewhat risky because it depend on market. So, please read the document carefully before investing in it.