Archive for September, 2007

by Ron Lanieri
In the “up” scenario, the maximum gain that can be attained is the stock finishing at $10.00 or higher.

At $10.00, you would profit from the full value of the extrinsic value of the option which is $.50 and you would also have $.50 of capital appreciation from the stock for a total of $1.00. This represents a 10.52% one-month return or an annualized return of 126.32%.

It is not realistic to expect this type of return every month but remember, recent studies show that premium selling works approximately 80% of the time, which is still very good.

We stated earlier that the maximum return of this buy-write will be actualized when the stock reaches $10.00 or above and the maximum return will be $1.00, and no more than $1.00. As the stock goes higher, the option will earn less in direct proportion with the increase in capital appreciation.

For example, if the stock closes at $10.30 you would receive only $.20 from the option. The option would now be worth $.30 because with the stock at $10.30, the 10 strike call would have $.30 of intrinsic value.

Since you sold the option at $.50, you would see a $.20 profit ($.50 - $.30 = $.20). Since you bought the stock at $9.50 and it is now $10.30 you have $.80 of capital appreciation. Combine the two and you have a $1.00 profit.

Let’s look at what happens when the stock trades up to $12.00 and see if you again have a $1.00 return on the position. At $12.00, the option will have $2.00 of intrinsic value (stock price - strike price) because it is in the money.

You sold the option at $.50 so you have a $1.50 loss. However, you bought the stock for $9.50 therefore you have a $2.50 capital gain. Combined, you have a $1.00 profit.

In a third example, if the stock trades up as little at $.10 you still have a $.60 gain. You will receive $.50 from the sale of the call which would expire out of the money thus worthless plus $.10 of capital appreciation. $.60 represents a 6.3% one month return.

Please refer to the chart below for examples of total dollar profits per number of contracts, remembering that each contract controls 100 shares of stock.

Observe that if the stock closes over $10.00, then your stock will be called away because your short calls will be exercised. This is correct but we will talk about position management later. For now, let’s get back to our three scenarios.

In the “up” scenario, you would profit with the buy-write when the stock is up as little as a penny, but you are also limited on our maximum profit.

You are limited on your maximum profit as defined by the formula below:

Maximum Profit = Strike Price + Option Price - Stock Price.

This method of calculation will work every time. As you see, the buy-write has a positive but limited upside potential.

About author:
Ron Ianieri is a professional options trader, former floor trader, and market maker on the PHLx options exchange. As co-founder of the Options University, Ron teaches hundreds of aspiring options traders from all over the world how to trade options ‘the right way’. Click here to learn more: optionsuniversity.com

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by Redwoodbridges
Amateurs and beginners often face such quagmire in taking investment decisions in their formative years. However, lack of any direction means that it is baptism by fire for most of them. However, if you are diligent, such situations can be avoided and wise investment decisions are possible even if you are an amateur in your trade. Here are some useful investment tips for beginners.

The first step is the basic education regarding the business you are planning to invest in. You can visit your local library or cull the sources from the Internet and learn as much as you can, regarding the business. Of course, there are some things that you can learn only through experience but still, literature will give you ample indication about the kind of problems likely to be encountered by the beginners in the business.

Finance is a major issue for amateurs. The important decisions include how much to invest, what is the best source of finance, what are the long term and short-term repercussions from borrowings, etc. These questions are best answered by experts on the subject. You can either approach a reputed investment company or seek professional advice by writing to the experts, who give free advice in leading newspapers, business magazines and trade journals. Alternatively, you can also buy books or scan online resources for a solution to your situation. However, it may be time consuming and if you don’t have much time to spare, then professional help is a better option.

A combination of self-education and professional advice goes a long way in making an informed decision. This is because as an amateur, you can learn so much by reading and attending conferences and seminars, but interacting with professional investment advisors will give you crucial insights that you can easily employ in the business. Moreover, by educating yourself, you will be in a better position to decide the best investment advisor for your business because your knowledge will tell you if the advisor is just trying to mint money or a genuine consultant.

The place of setting up the registered office of the business is another vital aspect to ponder over while starting a new business. It may be possible that doing business in certain regions, cities, or states might save you ample tax liability. Governments, these days, are aggressively granting tax-holiday status to the lesser developed states and regions. Considering all the pros and cons and long term and short-term implications, you can easily decide as to which place gives you maximum overall benefits and better returns on investment. It won’t be a bad idea to seek for a feasibility report from your consultant about the proposed business.

Finally, if you have business sense, you’ll think business most of the time and when you think business, more often than not, you take into account all the aspects involved in the business, and take an informed decision.

Rod Bird owner of www.AAHIT.com is your number 1 investment resource website. Also owner of www.redwoodbridges.com for all your custom wood products.

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by Aaron Stokes
The investment world can seem quite intimidating at first glance, often people shy away from discovering the advantages of investing simply because they are overwhelmed with the abundance of investment terms and categories. You may find after a little bit of research that investing is more simplistic than it may seem at first glance.

Very few people realize that investing is already an every day occurrence. In fact the majority of people are completely unaware of the fact that investing is something they do on a regular basis, whether they realize it or not.

Each and every college student, employee, parent and human being on the face of this planet is investing in one thing or another every day. Time and money are invested each day in things like Food, Education, Children, Cars, Entertainment and the list goes on.

When we invest in something we expect to receive in return something of equal or greater value to that which we spent. For example, if we invest time into our education our hopes are that one day the rewards of an increased intelligence in a certain field will help increase the overall quality and value of our every day life (and possibly even the lives of others). Were we to invest in entertainment, say for instance buying a “ticket” at the movie theatre, we are investing with the hopes that the joy we receive will be equal to or greater than the value of an $8 dollar movie ticket.

So as we come to realize that investing is something we do on a daily basis, an aspect of life which permeates all things both monetary and otherwise, it becomes our responsibility to start deciding where and how we want to invest our energy to maximize the quality of our choices and the impact they have on our life.

So what makes “Investing” so intimidating and why do so many still shy away from it, even though they are already doing it day in and day out. Finding this answer will help create a dynamic shift in the way you move forward on your path towards financial growth. Professional “Investors” spend cash to make cash, the rest of the population spends cash to receive things other than cash (ex. gas, shopping, traveling, etc.)

These items that we spend our hard earned cash on often times stand as a gap between our financial security. Given the option to choose between investing: 1) 65 dollars cash, in return for 95 dollars cash each and every Saturday evening or 2) Buying a new shirt and a new pair of pants every Saturday evening.

Which would you choose?

You see Investors are keenly aware of not only where their money is going, but how to utilize their money in order to maximize the amount of cash they will receive in return when their money comes back to them. Whether or not we choose to educate ourselves when it comes to investing our hard earned money, well that’s not something that can be forced upon anyone. Investing must be a decision made based on a genuine interest to achieve a higher standard of financial excellence. Once we realize that we’re all investors, and that investing is something we have done and will continue to do until the day we die, the decision to become a well informed Investor becomes that much easier.

In a following article I may write up on some of the options investors have for capturing significant returns using various investment tools. Until then invest in your future by taking some time to ponder the essence of the daily investor, and how your life will be effected by your decision to pursue a broader understanding of the wide world of investments.

Ranked in the Top 10 by Google as an International Forex money manager Aaron Stokes is a professional in the field of managed Forex accounts with an average of 10% growth per month on managed accounts. For details visit: http://www.forex-cipher.com

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by Dexx Johnson
An unwanted side to investing in penny stock is how quickly you can lose money fast in a bad investment. Even though the rewards of penny stock investing are far greater than most investments you will find, the risks can be daunting.

If you are like me, you want high returns fast without losing money. I will show you two ways do avoid risk and get high returns, the slow way and the way I use (which I will mention at the bottom of the article).

Here is the long way, but one that works, to greatly reduce, perhaps even eliminate, the risks of penny stocks:

1. Beware Hot Stock Tips: You have most likely received a “hot tip” via spam email at some point or another. The promoter promised you fantastic guaranteed returns on your hot penny stocks investment. They word the email to make it a “once in a lifetime” opportunity to you. The best thing to do is delete the e-mail. Chances are you’re being scammed by a “boiler room” scam operation. These shady operators buy up worthless shares at fractions of a penny and then attempt to flip them for a few dollars per share.

2. Trading Penny Stocks in Unregulated Exchanges: Unregulated environments do not have to meet the traditional requirements expected of most exchanged that involve penny stocks. Companies in these situations tend to be of lesser quality. Avoid stocks traded on the OTC or pink sheets.

3. Erratic Trading Activity: You should avoid purchasing penny stock that is trading erratically. You could be stuck with the shares for a long time since it’s very hard to find a buyer.

4. Lack Of Reporting By Company: When you invest in a company, you want to know what you’re buying. To give you an idea, you need their financial statements in order to properly evaluate the company. If no financial statements are issued, the company might have something to hide.

5. Company Hype: Be careful of companies that constantly issue statements that highlights the latest developments but provides no details on how it helps increase revenue or profits.

You may find all these tips frightening in the fact that it requires a lot of in-depth research to be done on all stocks you are considering purchasing, and you’d be right. However proper research is key to eliminating risk!

For those not accustomed to it, the stock market looks either a rosy picture or the dooms day scenario. In reality, it is a mixture of both. By investing in researched stocks, you can get the money of a life time or if you are not careful, you may lose the money of life time. While not every one can become Warren Buffet in stock market, at least you can avoid losses by avoiding the following 5 tips provided above.

I’ve been quite successful at the age of 24 using penny stocks to not only pay off my college tuition for the past two years, but also keep me debt free! This has been done through following the advice I outlined on my personal website PickTopStocks.com!

Regardless of the method you use to do your research, just make sure you do research!

Enjoy, and here’s to your success!

Find daily Top Performing Penny Stock Picks and other great advice on http://www.PickTopStocks.com with an uncomparable history of consistent stock returns.

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by Dexx Johnson
Believe me, good penny stocks do exist in life! Despite the bad reputation that shady stock promoters and boiler room operations have shadowed onto the world of stocks in the past. Companies like Dell and Microsoft had their beginnings as a penny stocks after all! Imagine the returns you would have had if you held on to them from the beginning!

Penny stocks are often overlooked by large media publications and analysts due to the work required to find quality performers. However finding the best penny stocks is no different than picking the best stocks of large corporations! Successfully well run businesses share many traits and usually are reflected in their share prices.

Now there’s a hard and easy way for you to find amazing returns from penny stocks (I myself was able to make $850 US off of $150 CDN in my first 3 weeks after using my personal strategy which I’ll discuss at the end of the article).

Here’s the old and long way for you to find successful penny stocks:

1. First and foremost trade on paper. Until you can see results on paper, do not risk capital. This way you know that you have a clue of what you are actually doing!

2. Ensure Shares Trades in a Regulated Exchange: By trading in a regulated environment, companies show that they supply and meet the necessary financial information to its shareholders and other compliance issues. Reputable exchanges are the AMEX American Exchange and the NASDQ SmallCap Market.

3. Watch That the Company is Up To Date With Financial Reporting: This is a very important sign of the reliability of a company. It shows you that a company runs a tight ship with no secrets. To do the proper evaluations of penny stocks, the most current financial information is needed.

4. Strong Revenue and Profit Growth: The main reason to buy penny stocks is to get high returns. Capable management, a good business model and strong operating results are signs of a well-managed company. As long as the company shows they are continuously making more money than the precious year, the share price will likely appreciate.

5. Upward Trend in the Penny Stock’s Share Price: When a company does well or struggles, the situation could go on for years, creating a trend. The fortunes of the company tend to be reflected in its share price.
So by manually practicing on paper, and spending hours analyzing companies you will see record profit returns! However, I have managed over 103% returns on average for the past 3 months via the newsletter featured on my site.

But that’s a story for another day!

Enjoy your success in the amazing world of Penny Stocks!

Find daily Top Performing Penny Stock Picks and other great advice on http://www.PickTopStocks.com with an uncomparable history of consistent stock returns.

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by Mark Dale
If you are looking to invest in a secure and strong property market, then if you do your homework you can’t really go wrong with a Cyprus investment property. There are many things to consider when investing in property, such as capital growth, mortgage rates, rent-ability, accessibility, the weather, and so on. This article discusses the reasons why I think Southern Cyprus is an excellent property investment opportunity. On the contrary, I think Northern Cyprus is not a safe investment, but I’ll discuss this one in a later article!

The Weather

There are approximately 340 days of sunshine a year in Cyprus, where the tourists and the locals can enjoy basking in the sun. When the weather in the neighboring countries is getting cold, Cyprus is still warm and sunny. If you buy a property and your main aim is rental, then an all-year-round rental season is a huge bonus, especially with more and more holiday makers looking for winter sun.

The Law and Taxes

Cyprus is a very British island and has adopted many of the English common laws. Not only are the laws very similar to the UK, but the locals also speak very good English as this is their adopted second language. For this reason, there is a large amount of British buyers, many of whom buy a property in Cyprus for retirement purposes. There is still a strong influx of second home-buyers and investors, but the low taxes are a great incentive for permanent living and investment. In fact, the inheritance tax in Cyprus is 0% and UK pensions are taxed at only 5%.

The European Union (EU)

When Cyprus became a member of the EU, property investors became increasingly interested in the Cyprus property market. On top of this, a new VAT rate was of 20% was added to new build property where planning permission was not granted before the law came into affect. Previously VAT was 0%, so together these factors caused a large influx of investors.

As of the 1st January 2008 Cyprus will also adopt the Euro single currency. These changes to the Cyprus investment property market will surely mean longer term security for your hard earned money.

Shortage of Land for Developers

There is a shortage of land for developers to build on in Cyprus and there are strict planning laws on the height and density of new developments. In the medium term the amount of new builds will decrease and the amount of re-sales will increase, proving that getting into the market early should show some strong capital gains in 5+ years.

Budget Airlines

The first budget flights from the UK were launched this year, indicating a much stronger and predict growth for travellers. Again, this can only benefit the buy-to-let market if that is your main goal for a Cyprus investment property.

Banks and Mortgages

It is relatively simple to get a mortgage in Cyprus, and with mortgage rates falling inline with the EU it has become a great place to arrange your mortgage. Mortgage terms can be up to 90% of the LTV and repayment terms can be up to 30 years.

Short Term or Long Term?

I think the short term “buy to sell” market has cooled down due to the number of developments currently on offer and the shear volume of developers in competition. This could actually bring on uncertain and unpredictable turbulence in the next year or two. On the other hand, this means you can still pick-up bargains if you do your homework before visiting Cyprus. For a medium to long term investment in Cyprus property, I really don’t think you can go wrong within Southern Cyprus. As a sun destination, there are very few markets as safe and attractive as this one.

As for the areas of Cyprus and the different types of property to invest in, I will cover this a separate article.

For facts, news and information on everything Cyprus related then visit Cyprus Info. For travel guides and travel tips, then check out our Cyprus Travel Guide.

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by alexhamsten
When you are considering investing your money in CDs then the final return on your investment should be the top priority to consider when you are doing this, as there really is no risk factor to take into consideration that often comes with other investments. The absence of risk is the most enticing aspect of CDs, so they are a great way to augment your retirement or investment portfolio as a hedge against other investments that may carry a higher level of risk.

Many institutions offer higher CD rates as an incentive for buying in bulk, so this is one thing that is worth considering. CDs with the longest maturity period will always tend to offer the highest rates, however CDs with the higher rates of return can also carry with them higher penalties for cashing them out prior to reaching maturity. For this reason one should only use capital that they wont need to access for CD investments.

Finding the best deal on CDs is done the same way as you would find the best deal on anything else and that is by shopping around. There are many sources for CDs and some of them include brokerage firms, banks and credit unions. Currently banks and credit unions are offering the best rates on CDs. Another place to look for good deals on CDs is online, as there are a number of sources for CDs that can be accessed through the internet.

Before you invest in CDs you should make a comparison of the return on other low or no risk investment opportunities, including standard savings accounts at banks and other savings institutions. One of the great benefits of keeping your money in a standard savings account is that the money is always accessible and there absolutely are no penalties for early withdrawal.

Written by Alex Hamsten. Find the latest information on Best CD Rates

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by alexhamsten
If you are considering investing in CDs or are currently investing your money in CDs then one important fact to bear in mind is that CDs with the longer maturity periods will always tend to have the highest return on your investment. While there are investment opportunities that have the benefit of a higher return, they most often carry with them some element of risk.

One should always remember that risk is good when it pays off but it just as often can lead to loss and if you are saving for your retirement you should give careful consideration to this fact. When you invest in CDs there is no risk, so they are an excellent way to augment your investment portfolio if you have other high risk investments in it.

There are a number of sources to consider when shopping around for CDs and a few of them are news papers, ads at local lending institutions, credit unions, or brokerage firms. Banks and credit unions are two sources for CDs that will usually tend to offer the highest rate of return on your investment in CDs.

One thing to bear in mind before you invest your money in CDs is that your money will be locked up for the duration of the maturity period and if you need to access the money that you have invested in CDs before they have matured than you will lose out on your investment.

Buying CDs in bulk is another avenue that an investor can take to receive a greater return on their investment as many institutions offer higher rates of return on CDs that are obtained in bulk. Before one invests in CDs you should make a comparison as to how the rates on the CDs compare to the long term interest rates regular saving with a savings institution.

Written by Alex Hamsten. Find the latest information on CD Rates

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by zola
All investors are looking to find the top mutual funds for investing their money.

In general, when we talk about the top mutual funds, we are referring to those that have weathered the market well, consistently making money for their investors. First, with a few exceptions mutual funds and the entire brokerage industry are devoted first and foremost to making money for the company. Stocks, bonds, money market securities and the like are purchased through the assets of these mutual funds in the financial markets.

There are usually 3 types of mutual funds available in the market, high, intermediate medium and low risk. Investors who have been able to do this have made gains of up to 400% in just 4 years and all this with low downside risk, which is much better than the bulk of mutual funds. It is UK land, with an average growth of 920% over 20 years and keep in mind this is just the average careful land plot selection has yielded far higher gains and downside volatility is low and gains compare very favourably to mutual funds.

As the value of the stocks, bonds, and other securities contained within the mutual fund rise and fall, the value of the fund itself fluctuates… the average value of each share of the mutual fund is determined each day as an average of the total value of all of the securities that are contained within the fund. Each investor in the mutual fund is considered to be an owner of the stocks and other investments contained within the fund, and is usually granted the same rights, privileges, and voting powers of other owners of those same stocks and investments. Finding a mutual fund that is managed by an investment company that has a strong record of choosing lucrative investments is a good sign that the fund might be a smart buy, and securities held within a fund that are consistent performers can help add stability and security to an investment that may seem otherwise unstable.

A $100,000 investment in a diversified, no load mutual fund that grows at 10% per year results in $259,374 at the end of 10 years. In a related article, we have looked at how investors can use sector funds to construct a diversified, no load mutual fund portfolio. Using sector funds to create a diversified mutual fund portfolio By allocating assets across a group of sector funds, investors can effectively create a diversified mutual fund portfolio using sector funds.

Thus by allocating even a relatively small, say 15%, of the total portfolio of no load mutual funds to sector funds, you can dramatically increase your returns. Since mutual funds are usually already diversified, they are an excellent way to add diversity to your stock portfolio or to increase the holdings of an already-diverse portfolio. One of the most recent offerings to the mutual fund market are known as target maturity or target date retirement funds.

I am able to choose no load funds and make buy decisions solely on the basis of my mutual fund trend tracking methodology. So exchange traded funds offer most of the advantages of mutual funds instant diversification and many to choose from without the major disadvantages. Mutual funds offer several advantages regardless of the type you choose.

Zola Mathe is the writer and advisor on investment for more information visit his website http://www.allwiseinformation.com/All_Free_Investments_Information.html

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by Lee Cameron
If you are considering a renovation anywhere in your home, but especially in the bathroom or kitchen, consider stone. Stone tiles and granite counter tops are very much in style right now, and for good reason—they are long-lasting, need little maintenance and are gorgeous. Not only that, they are synonymous with quality, adding flair to your home and increasing its resale value.

Let’s take a look at tile flooring. One of the main benefits here is the huge selection. Of course, this can also be a challenge, but with a mind for your budget and needs, it shouldn’t be hard to find the tile flooring that’s right for you. Tile is usually available in stone, ceramic, terra cotta, glass or metal. Tile can be bold or subtle. It can be the same, consistent experience all through the room, or even house, or it can be patterned with contrasting colors or even incorporate printed tiles. No matter what your aesthetic style, there is a type of tile to suite your needs.

If your needs are casual elegance and high performance, consider terra cotta tiles. Their mottled appearance can disguise spills and dirt, and this comes in handy if you have kids, pets, or just don’t have time to clean every day. The downside to them is they have a porous surface, so can gradually stain if they aren’t treated with a quality sealant. For this reason, they may not be ideal for kitchens, unless they are well sealed. Glazed ceramic tile might be a good choice if you anticipate messes. Their glazed surface makes them easy to clean and they won’t stain. Plus, they are affordable and easy to install.

Marble is popular for a formal look, as is limestone. There is so much diversity in color and texture, half the fun will be in deciding what look you want to achieve with this surface.

Metal can be expensive and delicate (stains, especially with acidic things) but it sure makes gorgeous kitchen back splashes. Again, a quality sealant will prevent staining if that shiny look of metal is what you are after. For a little something extra, add some embossed tiles for accents or borders.

If you are installing flooring, pay attention to color. White tile floors will show every footprint. A more earthy tone, however, will radiate warmth and look good, even after your guests have walked all over it.

Granite counter-tops are easy to clean, but if you want it to stay stain-free it’s a good idea to purchase sealed granite, or seal it yourself with a high-quality and durable sealant. After that, it’s up to you how you clean it. Many granite counter-top owners recommend specialized granite cleaning products, but just as many say simple soap and water works great. Almost unanimously, however, they recommend a microfiber cloth for wiping up after washing. These assure a streak-free shine. No need to buy fancy cloths marketed just for granite. Check out the car-detailing section of your local hardware store for inexpensive microfiber cloths.

Other than regular cleaning, your granite counter top will last a lifetime, and only needs to have its sealant re-applied every couple of years.

With granite counters and tile flooring, you are assured long-term value for your home. Stone and ceramic details add elegance to any home, and that’s good news for sellers and buyers alike.

Lee Cameron is a professional REALTOR® serving the Orlando real estate market. Lee has consistently proven his talent and knowledge in the real estate business and is known to his flair the business and the care with which he treats his clients. For more info on homes & properties in Orlando contact Lee today.

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