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A commodity investment is an  scheme where many individual investors combine their moneys and trade in futures contracts as a single entity in order to gain leverage. They are analogous to mutual funds wherein a fund is similarly set up expressly for trading in equity, except that mutual funds are open to public subscription whereas commodity pool and hedge funds are private.

Commodity market deal in the trade of commodities like gold, cotton, crude oil, orange juice etc. Many items both perishable non perishable, finished goods, raw materials and semi finished goods will be traded in this market at the international level. Commodity market does not necessarily require you to buy or sell the commodities but you can even exchange them.
 
Commodity tips was initially received well only by a few sectors.

Commodities investing were first restricted to the trade and exchange of commodities meant for regular and day to day use. However the awareness in the subsequent stages has brought all sectors into the manifold of commodity investing and has enabled speedy movements, transfer and transaction of goods and services.

It covers physical product (food, metals, electricity) markets but not the ways that services, including those of governments, nor investment, nor debt, can be seen as a commodity.

Commodity enthusiasts, on the other hand, would argue that it is better to own futures contracts than to own shares of companies that produce commodities. Reason: They expect commodity-price inflation. Periods of price inflation tend to hurt equity valuations, so you won’t get the full benefit of rising commodity prices by investing in the companies that produce them.

The group started the Citi BRIC Commodities Index, a gauge of raw materials based on consumption by Brazil, Russia, India and China, a year ago. The index returned about 19 percent to investors this year, the most among 52 indexes monitored by Bloomberg News. The Citi CUBES GSCI-Weighted Index, introduced in 2009, gained more than 16 percent and ranked second, beating the Standard & Poor’s GSCI Enhanced Commodity Index.

Each commodity contract requires a different minimum deposit, depending on the broker, and the value of your account will increase or decrease with the value of the contract. If the value of the contract goes down, you will be subject to a margin call and will be required to place more money into your account to keep the position open. Due to the huge amounts of leverage, small price movements can mean huge returns or losses, and a futures account can be wiped out or doubled in a matter of minutes.

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The most common paradox we come across is ‘money does not bring happiness.’ Then why since time immemorial, people from different civilizations, continents, customs and religions desire to be affluent, prosperous and wealthy. Money is not everything in the world, definitely there are few things, much more important than prosperity, like our health, family and people we love and respect. Nevertheless, money is the binding factor of present age that manages all our needs.

People who say money could never buy happiness are those who either don’t have money or those who have it but do not know how to properly utilize it. The best utilization of money is to invest it, to get an opulent present and future life, without economic worries.

For the success of every mission a strategy is needed. To get the economical freedom and be self sufficient one has to adopt investment strategy.

The strategy mirrors various internal and external factors such as present income, the type of work and industry, age, education, mindset, risk tolerance and so on. There are various avenues of investments: art, antiques, business, property, equity and so on.

However, historically proven, investment in equity yields higher returns provided we have prudently planned our portfolio. Equity investment means buying shares of a specific company with the expectation of generating wealth through dividends, capital gains and appreciation in the price of shares. The role of the investor is to provide the requisite funds to the company, with the assurance of receiving a proportionate percentage of profit.

Investment strategy is associated with various risks. We should properly understand several kinds and forms of risks before taking investment decisions.

The most widespread risk is emotions and speculation, Speculation is not investments; investing in equities and/or derivatives on the tips from friends, relatives, guests on CNBC TV, etc. expecting a quick windfall profits. Understand, that even the most visionary and experienced investment guru like Marc Faber acknowledges timing the market is the most difficult task and requires lots of experience, expertise and data. Every investment decisions should be based on proper research conducted by competent analysts. Once should take their advice and ask as many questions in order to clear the air

The most successful investment strategy, adopted by Berkshire Hathaway chairman Mr. Warren Buffett is value investing. Accumulate shares of companies that are available at tangible book value, are traded at lower than their book value, have low PE (price to earning) ratios with high dividend yields. Value stocks outperform market in longer run, provided we do not let our emotions play any role in our investments decisions. No greedy buying, no panic selling, no speculations, not following herd mentality i.e. buying or selling because one of our acquaintances is doing so. We should always diversify our portfolio baked by solid research conducted by proficient professionals of a qualified fund house offering PMS services with good track record. Never forget to periodically monitor and evaluate the returns of the portfolio, checking if they are going steady with the market or the benchmark index and the investment goals.

Always keep in mind that our money should work as hard as we do and if the portfolio is not keeping pace with the expectation, do not shy to reshuffle the investments. In the end of the day, we would be responsible for the profit or loss, so be shrewd and prudent and get rich soon.

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There are plenty of financial advisors easily available to offer investment advice. You can either choose an independent financial advisor or a financial firm to help you with your investments. In either case you need to choose the one who will be interested in helping you make wise financial investments. 

Types of Independent Financial Advisors:

Basically there are two types of independent financial advisors; fee based advisors and commission based advisors. Fee based advice will work out a little expensive than commission based advice. However, if you are investing large sum of money than fee based advice will be cheaper. In either case, getting better investment advice can help you earn better profits. Independent financial advisors offer both fee based advice as well as commission based advice, so depending upon your financial situation, your aims and objectives you can choose your advisor. 

How to Choose Independent Financial Advisors?

Many banks and financial institutions will be more than happy to offer investment advice. However, they are only agents who are focused on selling you their products and they employ independent financial advisors only to cater to high net worth customers. Therefore, you should choose an independent financial advisor who is not restricted to selling only a particular type of product or products that fetch him high commissions. 

Begin by choosing about four advisors and visit them before taking a final decision. During these visits, make sure to carry all the information about your current financial situation. Ask all the questions you need to and check how the advisors plan to help you get the maximum benefits. This initial ground work will help you choose the right advisor. 

Where to Find Independent Financial Advisors?

Personal recommendations are the best way to find a good independent financial advisor. However, you always need to check whether the financial advisor has the necessary qualification and authorization certificate issued by the Financial Services Authority. You can also check with organizations who can give you the list of authorized  independent financial advisors in your locality. You can also choose any of the reputed financial companies for investment advice. Usually these firms employ qualified and experienced financial advisors to give you some of the best investment options and plans.  

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How many times have you heard people speak of investing in the stock market? They talk about selling short or long, putts & calls. How they bought a ‘penny’ stock & sold for ‘a killing’. You have to admit, it has a  romanticism to it. Wall street is an exciting place where Billions (with a B) are trading every day. Some millions are gained and some are lost.

For most, Wall Street is a place in the movies or what we read about in the newspaper. If you ever get the oppor

tunity, go visit Wall Street.

You will be amazed. It is a frantic experience.

Baby Boomers are risk takers. That’s why this country has progressed to where it is today. Are you? If you decide to invest in the stock market, you must do your due diligence.

You could be a very successful investor or you may bring financial ruin to yourself and family. Remember Bernie and his Ponzi scheme?

With today’s electronic world, you can do trading online with just a few clicks of the mouse. Imagine with one click you can go broke. So here lies your Caviot. Do your home work, speak with professional investment counselors, CPA’s, tax attorney’s, bankers and the like.

Some of the advantages of being online with your financial information are:

..  Your bank balances are only a few clicks away & your investments > are there for you on a daily basis. You can have updates emailed to you.

This type of investing can raise your awareness or lower your tolerance when you see what’s happening on a daily or hourly basis.

…  Online services have lowered trading fee’s and made it more convenient for you.  However, by not meeting with a broker, you may loose contact with their expertise.

… Warning!  Your online trading can become not only entertaining but also obsessive.  Rather than putting your money into an investment that will meet your long term goals, you may look to do short term more risky investments.

. The sudden interest in online trading has made more people knowledgeable about the stock market and what their money is doing.  There is no downside to becoming educated about this important part of your financial planning.

As with anything in life, common sense and balance is crucial not to let yourself be obsessed with investing.  Baby Boomers have a lot of time on their hands and often find themselves without enough money at the end of the month.  So, it’s easy to see online investing as a way to supplement their income.  Be careful….You may loose it all.

If there was any mantra, we must have about investing, especially if we are using online tools, it is, �Be prudent and be informed.�  There is no replacement for getting some education and doing some comprehension into the workings of the stock market and into the strategies that are most likely to be a success for you.  The stock market is no place for �get rich quick� schemes because they are more likely to result in �get poor quick� outcomes. 

But for the smart  baby boomer who does his or her homework and knows what they are doing and gets good advice from investment analysts that know the market, online investing can become a good addition to your financial planning arsenal and be a lot of fun for you as well.

How will you build your retirement fortune?

Http://www.Retirementusa.Com provides complete solutions for your life-style

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Investment Procedures

Almost certainly, the discussion has been at such a high level of generality that it provides little concrete guidance for real investors. After some more similar, general, and abstract discussion of related topics, such as capital asset pricing and risk, we hope to provide some help in translating these general concepts into usable investment procedures. In order to define Markowitz’s efficient set of portfolios, it is necessary to know for each security its expected return, its variance, and its covariance with each other security. If the efficient set were to be selected from a list of only 1,000 securities, the volume of necessary inputs and the computational costs would be intolerably large. It would be necessary to have 1,000 statistics for expected return, 1,000 variances, and 499,500 covariances.* It is not realistic to expect security analysts to provide this volume of inputs.

If 20 analysts were responsible for the 1,000 stocks, each analyst would be responsible for providing almost 25,000 covariances. The volume of work would be intolerable and, furthermore, it seems to be quite difficult to have an intuitive feeling about the significance of a covariance.

Because of this practical difficulty, the Markowitz portfolio model was exclusively of academic interest until William Sharpe suggested a simplification which made it usable.1 Since almost all securities are significantly correlated with the market as a whole, Sharpe suggested that a satisfactory simplification would be to abandon the covariances of each security with each other security and to substitute information on the relationship of each security to the market.

In his terms, it is possible to consider the return for each security to be represented by the following equation: where Rtis the return on security i, atand b,Lare parameters, ciis a random variable with an expected value of zero, and / is the level of some index, typically a common stock price index. In words, the return on any stock depends on some constant (a) plus some coefficient (b) times the value of a comprehensive stock index (say, the S & P “500″) plus a random component. Sharpe’s simplication reduces the number of estimates that the analyst must produce from 501,500 to 3,002 for a list of 1,000 securities.*

There have been other efforts at simplification derived from Sharpe’s ideas. Cohen and Poague suggested that several indexes rather than a single index be used, with the return for each security being related to the index most appropriate for it—perhaps some index of production which is a component of the aggregate Index of Industrial Production of the Federal Reserve Board. Their empirical results suggest that the cost of using simplifications—either Sharpe’s or theirs—is small. That is, the portfolios which are efficient as a result of their simplified processes are very similar to the efficient portfolios that result from Markowitz’s more complex process. Furthermore, if results are evaluated in terms of the two criteria, expected return and risk, the efficient portfolios from the simple process are insignificantly worse than the efficient portfolios from the complex process.

During these times, there is really no wonder if you are going to venture in investment property. A lot of people want to try this out to secure their financial status so that they can fund the education of their children or in preparation for their retirement goals. There are also some people who want to try this out so that they can create a more passive income and they will not just rely on their regular employment. No matter what your purpose could be, investment property is indeed a venture that anyone can try.

But if you want to try this out, you should also know that there are a lot of things that you still need to take into account. As you must have already known, this is not an easy venture. There are still a few important things that you need to take into account so that you will be successful with this venture. When it comes to Investment Property, you should always consider the location of the property that you are going to purchase. And in order for you to do so, you have to consider the purpose of the estate. For instance, if you are going to purchase a townhouse, apartment, or a condo, it is necessary for you to make sure that it is accessible to all the major establishments such as churches, shopping malls, restaurants, and the likes. You should also be certain that transpiration is not a problem as well as the security.

Of course, you should also never forget to consider all the expenses that you may incur when you purchase a house or a condo. You have to make sure that you are aware of the principal and the interest rates that you will have to consider as well as the required annual taxes and the regular maintenance fees. Aside from these obvious expenses, you should also make sure that you will be able to accurately assess the costs that you may incur when maintaining the condition of the foundation, walls, roof, and the likes. All of these should be covered so that you will be able to accurately estimate if you will really be able to afford venturing in investment property.

You should also never instantly agree on the price that will be offered to you. It can be very helpful if you are going to look for discounts. When it comes to investment property, you have to determine if the discount is already deducted on the gross price. This is why it may also be every helpful if you are going to learn how to negotiate with these kinds of transactions.

Then, once you have successfully closed a deal, you can look for a tenant who can really pay the required rent. This is necessary because you do not want to get a tenant who is more of a burden than an asset. You should also be certain that they are responsible enough so that they will really take care of your property.

But if you are really clueless about all of these things, then it can be very helpful if you are going to ask for the assistance of professional agents. They are really experienced with these kinds of transactions and they also know where you can get huge discounts.

There are still some things that you need to consider when it comes to investment property, but these tips should be able to give you a good start.

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During these times, there is really no wonder if you are going to venture in investment property. A lot of people want to try this out to secure their financial status so that they can fund the education of their children or in preparation for their retirement goals. There are also some people who want to try this out so that they can create a more passive income and they will not just rely on their regular employment. No matter what your purpose could be, investment property is indeed a venture that anyone can try.

But if you want to try this out, you should also know that there are a lot of things that you still need to take into account. As you must have already known, this is not an easy venture. There are still a few important things that you need to take into account so that you will be successful with this venture. When it comes to Investment Property, you should always consider the location of the property that you are going to purchase. And in order for you to do so, you have to consider the purpose of the estate. For instance, if you are going to purchase a townhouse, apartment, or a condo, it is necessary for you to make sure that it is accessible to all the major establishments such as churches, shopping malls, restaurants, and the likes. You should also be certain that transpiration is not a problem as well as the security.

Of course, you should also never forget to consider all the expenses that you may incur when you purchase a house or a condo. You have to make sure that you are aware of the principal and the interest rates that you will have to consider as well as the required annual taxes and the regular maintenance fees. Aside from these obvious expenses, you should also make sure that you will be able to accurately assess the costs that you may incur when maintaining the condition of the foundation, walls, roof, and the likes. All of these should be covered so that you will be able to accurately estimate if you will really be able to afford venturing in investment property.

You should also never instantly agree on the price that will be offered to you. It can be very helpful if you are going to look for discounts. When it comes to investment property, you have to determine if the discount is already deducted on the gross price. This is why it may also be every helpful if you are going to learn how to negotiate with these kinds of transactions.

Then, once you have successfully closed a deal, you can look for a tenant who can really pay the required rent. This is necessary because you do not want to get a tenant who is more of a burden than an asset. You should also be certain that they are responsible enough so that they will really take care of your property.

But if you are really clueless about all of these things, then it can be very helpful if you are going to ask for the assistance of professional agents. They are really experienced with these kinds of transactions and they also know where you can get huge discounts.

There are still some things that you need to consider when it comes to investment property, but these tips should be able to give you a good start.

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We were in Pune for my cousin’s marriage. As per our traditions, it was a grand affair spread across for a week. Me and my wife reached Pune two days before the function. The marriage was organized as a grand festival. We decided to stay in a hotel rather than being in their house, as it will be chaos there & also didn’t wanted to trouble them. The hotel we checked in was Area 51, Pancard Clubs. It was a huge structure something similar to spaceship. At the reception we got a warm cash loan. We were no VIPs but still they really took great effort to please us. The stay was quiet peaceful. As we were there for my cousin’s wedding, we didn’t had time much to explore the hotel or its features.

It was six month later I came to know about Pancard Club Investment Plan. My friend told me he invested in their scheme & as per the scheme he enjoyed some 3 days of stay in Pancard Clubs.

As I have been there before I know the place. But to enjoy that place at the amount very less than what we paid made me go crazy. I thought my friend got lured in to some fraud scheme. But after inquiring about the scheme I came to know that it was real. The company was offering such schemes. The company offered to provide days of stays in their hotels & resorts at a discounted rate. There were plans for three to ten years.  The amount to be invested was directly proportional to the investment term. Similarly the benefits from the investment differed on the basis of amount invested. When you compare all the schemes or plans you will get an average of 2 days of holiday per month starting from the first month. The company was ready to redeem any of your unutilized days as per the scheme. So you can actually get paid for the benefits not used by you.

I think by proposing Pancard Club Investment Scheme, company is trying to earn more by giving more.  It doesn’t end here company also provides extra benefits to its members. Extra benefits include medi-claim, insurance & discount cards. When I analyzed the whole scheme I found that it was risk-free. My returns are guaranteed. Even if I don’t use my rights I can redeem the same for the amount decided at the time of investment.

Investment timing is the bread and butter of traders seeking to cream off a few points difference between buying and selling. But what of investors, looking to buy and hold over the relatively long term?

For those focusing upon the longer-term, timing investing is less critical.

What’s your motivation?

The investor’s decision to buy or sell may spring from a number of reasons:

a)  a gut feeling that market is lower/higher than it ought to be

b) having some money available to invest

c) needing some money to finance a particular commitment

In the case of a) remember that current market prices represent the massed intellect of the world’s financial community, albeit with a give-or-take factor (that can be quite significant, in the light of recent market volatility).

In the cases of b) and c) consider whether the market is really the best source or destination for the available/required funds.

Weigh the market’s merits/demerits against the options, eg cash savings, loans etc.

The actual moment of making your investment can unleash a lot of emotion for investors, probably more so than for traders who may “pull the trigger” several times a day. Rather it’s something the investor may do several times a year.

Making the trade

The natural tendency is to watch the screen, trying to gauge the exact moment to hit the button. In reality it probably doesn’t matter too much; unless you’re extremely lucky you’re never going to get the absolute low/high. As an investor, you’re looking to hold the position for some time; its long-term benefits will far outweigh any pennies you might gain by precise timing.

If you’ve made a considered decision to invest, your decision has been made at current prices, or thereabouts.

Set yourself a limit of what you think the stock (or other position) of interest is worth. If it’s something you really want, the limit will be close to current price. If it’s more speculative the limit might be further away. Most brokers accept limit orders (to buy/sell if/when the price hits your pre-determined value), so you can place your decision on auto-pilot. But keep it under review if it doesn’t execute – is it still on your wish list? Is the limit too high/low?

Finally, once you’ve bought/sold stop looking at the price for a few days/weeks. As soon as the deal is done you’ll inevitably think you’ve traded the wrong side of an all-time high/low, which is highly unlikely. In reality you’ve bought/sold your chosen stock at your chosen price.

For investors the bottom line is to concentrate on the bigger picture, ie are you happy to buy/sell at a broad price level, given the competing alternatives. If the answer is yes, go for it and don’t sweat the pennies.

Bond investing basics are simple. When you buy a bond, the bond issuer – either a government or corporation – pays you an agreed-upon rate of interest known as the coupon rate. In addition, you get your original investment back when the bond reaches a maturity date.

Bonds come in many flavors: taxable and tax-exempt, long- and short-term, AAA-rated and junk, inflation-protected, fixed-rate and variable-rate.

Before investing in a bond issue, you should consider several factors.

Do you want to go long- or short-term? Normally, longer-term bonds pay higher interest than shorter-term bonds. However, monetary policy and inflation expectations vary with time, so sometimes the normal yield curve may flatten (meaning short- and long-term rates are equal) or invert (short-term rates are higher than long-term rates).1 When this occurs, it can be very hard to sell a long-term bond because investors can get the same or higher rate investing short-term.

The big question here is: where do you want to be on the yield curve? How long do you want to invest your money for a given return on your investment?

How much risk do you want to assume? As interest rates go down, the value of a bond goes up and when interest rates climb, a bond’s value falls. If an investor wants less risk, he might choose to buy a short bond, as its value will fluctuate less when interest rates vary. Long bonds usually offer higher interest rates because they typically carry more risk.

If an investor wants no risk, short-term U.S. Treasuries may be a good choice. After all, Uncle Sam backs them up – but they pay a comparatively low rate of return.

A bond’s duration relates to risk. (The duration of a bond is a measurement of how long it will take for the price of a bond to be recouped by internal cash flow.) A debt instrument with a 1-year duration is not very sensitive to interest rate fluctuations, while a really long bond with a 35-year duration will have its value fluctuate sharply with even a small interest rate change. Generally, a bond that pays a higher interest rate and has a longer term will have a higher duration.2

How important is the rating to you? Investors usually look to Standard & Poors or Moodys for bond ratings. Government bonds are perceived as less risky than private sector bonds. Some bond investors do have relatively high risk appetites, with some even buying “high yield” or “junk” bonds from troubled firms whose interest payments are in doubt. The riskier a bond, the higher the interest rate investors will demand.3

Do you want a tax-free or taxable bond? Many federal and municipal bonds are tax-exempt to some degree. Correspondingly, their coupon rates are lower than corporate bonds. You need to compare muni bond and corporate bond rates on an after-tax basis. You do this by calculating the tax-equivalent yield, which equals the tax-free interest rate divided by (1 investor’s federal tax rate, or federal tax bracket).4

Consider two investors. Investor A pays a 25% federal tax rate while Investor B is in the 35% federal bracket. Should they buy a municipal bond paying 4%, or a highly rated corporate bond paying 6%?

Well, the real question becomes: What will they take home after taxes?

They run the numbers on the muni bond. Investor A calculates his after-tax yield as 5.33% (4%/(1-.25) = 5.33%). Investor B gets 6.15% (4%/(1-.35) = 6.15%) after taxes.

Investor B chooses the muni bond. However, Investor A figures out that the tax exemption saves her less, so she selects a corporate bond and pays taxes on it.

Other options include inflation protection and variable rates. Treasury Inflation-Protected Securities (TIPS) are issued by the U.S. Treasury, and their principal depends upon the Consumer Price Index. Their principal increases with inflation and decreases with deflation. TIPS appeal to investors who fear that inflation could erode the value of their investment. When TIPS mature, the investor redeems either the original value of the security or the inflation-adjusted value, whichever is greater.5

Investors who can tolerate varying interest payments may decide to buy a variable-rate bond. The return on these bonds reflects the general level of inflation, and commonly rises with rising interest rates.6

Bond investing demands educated decision-making. Fortunately, bonds come in enough varieties that investors can find bonds appropriate for their tax situation, time horizon, and risk tolerance.

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