Friday, March 30, 2007
BUY GOLD, Read this............
In today's world of global uncertainty, one thing remains certain: gold coins. Gold bullion coins continue to outperform traditional vehicles the same way gold coins and bars outperformed everything under the sun during the 1970's. By holding gold coins in one's portfolio, you dramatically reduce the overall risk of your portfolio. Just by having some gold coins as part of your strategy, you also allow the price of gold, as it increases, to bring up the value of your portfolio.It is much easier to buy gold today than it was 30 years ago. Gold bullion coins are easily bought and sold with the click of a mouse. Not only is it easier to buy gold, but gold investments are exploding onto the investment scene like never before. In fact, gold coin sales by the U.S. mint in recent months have outpaced the gold coin sales of the prosperous-for-gold 1970's. Despite this recent fact, the gold price is just beginning its increase.As gold coins become more scarce, quite naturally, investors covet the yellow shiny metal at an ever increasing rate. The type of gold coins sought after by investors who follow the price of gold are American Gold Eagles, Canadian Gold Maple Leafs, South African Gold Kruggerands, Australian Gold Kangaroos, Chinese Gold Pandas, and Austrian Gold Philharmonics. These are the most popular gold coins available to investors who want profit potential and protection. The benefit to owning these gold bullion coins is four-fold.1. You get immediate liquidity. This means you can sell your gold bullion coins at or near the gold price at any time, anywhere in the world.2. You are in control. A strong gold investment is an investment in certainty. Knowing you have gold coins in your possession that you can rely on makes a world of difference to one's sense of financial well-being.3. There is tremendous profit potential with gold bullion coins, more so than just about every other vehicle out there. It matters not whether you hold American Eagles, Canadian Maple Leafs, South African Kruugerands, or any other type of these gold bullion coins, they will provide a well positioned investment portfolio an increased probability of profitability.4. Last but not least, gold bullion coins provide economic safety and stability in a world increasingly plagued with uncertainty and dangers. Those are some of the "pros" of owning gold bullion coins. There is more that a first-time purchaser of gold coins should be aware of; the "other side of the coin," so to speak. If you own American Eagles, Canadian maple leafs, South African Kruugerands, Austrian Philharmonics, Chinese Pandas, or Australian Kangaroos, they are subject to confiscation by the federal government. In 1933 Franklin Roosevelt issued an executive order which required U.S. citizens to turn in all gold bullion coins produced by the U.S. mint, as well as any gold coins and bars produced by foreign governments. Our country, in that period was in the peak of a crisis: the dollar was in trouble, smart investors were getting out of stocks and bonds, and unemployment was on the rise. This period was the great depression. The consequence of not turning in your gold bullion coins or gold bullion bars was a huge fine and jail. If you buy gold bullion coins today, like the American Eagle, the U.S. mint prints a $50 denomination on the back of the coin. Why? Because if the government were to confiscate gold bullion coins like they did in the 1930's, you would only receive the $50 denomination value, despite the current price of gold in the market, whether that price be $500, $1000, or even $2000. The chance of such Federal government confiscation is universally deemed as unlikely.Also gold bullion transactions are reportable to the IRS. We will also cover in detail the type of gold transactions that are not reportable, private gold, momentarily. Also important to recognize is that as the price of gold fluctuates, so does the value of gold bullion coins.Nevertheless, despite these contingencies, asset managers all over the country are recommending allocating at least some portion of an investment portfolio to gold. Prices are on the rise, in what analysts have termed a long-running bull market which is just in its beginning stages PRIVATE AND NON-CONFISCATEABLE GOLD COINS Investors naturally gravitate to gold investment vehicles where they can expect the greatest return with the smallest amount of risk. In the physical gold market certified gold coins reign supreme. Certified gold coins are the gold coins minted by the US Mint befor the year 1933. $20 Saint Gaudens, $20 Liberty, $10 Indian, $10 Liberty, $5 Indian, $5 Liberty and $2.5 Liberty gold coins are all examples of the most profitable gold coins an investor can acquire for several reasons. 1. Certified gold coins have a limited mintage. The government can not go back and mint any more of these gold coins. You want to own gold coins that continue to go up because of this fact year after year regardless of what the gold price does. Because of their limited availability these gold coins can surpass the gains seen by gold bullion 2 to 5 times.2. Certified gold coins are also one of the last legally private assets the government allows you to acquire. World Financial and goldcoinsgain.com are not required to ask for a social security number when you buy gold coins or when you sell gold coins.3. Non-confiscatable. Certified gold coins are exempt from confiscation. Certified gold coins are exempt from confiscation if the government decided to confiscate gold like they did in between 1933 and the early 1970s. You were in a world of hurt during those almost 40 years of you were holding the wrong kind of gold coins. So you can rest assured your certified gold will do what its supposed to do under the most strenuous conditions — protect your money.4. Immediate liquidity. World Financial is a major market maker in certified gold coins and will assist in converting your gold coins back into cash on a moments notice. In addition to the advantages listed above, certified gold coins are also more stable than bullion gold coins. The value of a certified coin is not solely determined by what the spot price of gold does. In fact, certified gold provides more stability than the stock market, bond market, or just leaving your money in cash. So if you are tired of having to worry about the current economic environment you may want to consider diversifying out of riskier vehicles into an asset that has stood the test of time. Portability is also something you should keep in mind when selecting which type of gold coins are right for you. To put things in perspective, you could carry one million dollars worth of certified gold coins in an attaché case. This should give you a sense of comfort knowing that you have acquired an asset that is completely portable and discreetly portable. IRA AND 401's BACKED BY GOLD COINS Gold Coins backing your IRA or 401k rollover makes the perfect diversification asset in today's uncertain economic environment. Gold coins can be added to your retirement strategy in just a few easy steps.Step 1. Determine what portion of your retirement account you would like to convert over into gold coins.Step 2. Print out the one page Gold Coin IRA Setup Form and fill out to the best of your ability. Fax the form into our retirement account department at (818) 506-6597.Step 3. A Gold Coin Customer Service representative will contact you in a very short amount of time to confirm and guarantee the availability of your gold coins. We then work with your existing custodian to get the appropriate funds transferred over into your new self-directed IRA, backed by physical gold coins.American eagle bullion gold coins are one of the most popular gold coins allowed by the IRS for your precious metal IRA. American eagle bullion gold coins come in 1 ounce, 1/2 ounce, 1/4 ounce, and 1/10 ounce denominations. These gold bullion coins are guaranteed by the US Mint for purity, weight and size. The Gold American Eagle bears the "W" mint mark reflecting the gold coin was struck at the US Mint at West Point. The obverse of the American eagle bullion gold coin features Augustus Saint-Gaudens' full-length figure of Liberty with flowing hair, holding a torch in her hand and an olive branch in her other hand. On the other side of the gold coin a male eagle carries an olive branch as he flies above a nest containing a female eagle and her eaglets. Each gold coin is encapsulated in plastic and comes with a custom designated Certificate of Authenticity.American Eagle Proof gold coins are also available. The proof gold coins are more desired because each year they are produced by the US Mint in a limited quantity. Each proof gold coin is struck several times with a special die to create a more lustrous finish. Because of the limited quantity, investors will typically prefer these gold coins for their retirement accounts. Weather we are talking about gold coins or widgets whenever there is a limited amount naturally prices increase faster and become more valuable. The American Eagle Proof gold coins are also exempt from confiscation. A lot of investors like knowing they have the type of gold coins backing their retirement account that are not subject to confiscation by the Federal government.
Monday, March 19, 2007
Sunday, March 18, 2007
Why The Best Person To Manage Your Money Is You
Self-Reliance is the Quickest Path to Financial Freedom
When I tell people that self-reliance is the quickest path to achieve financial freedom when it comes to investing, many people look at me like I'm crazy. In fact, I know a lot of people that told me they handed their money over to a firm after trying to manage their own portfolio and sustaining significant losses. But every person that had unsatisfactory results took the plunge without adequate preparation. They listened to the pundits on MSNBC, watched the Bloomberg Report, and read the Wall Street Journal and thought that they were sufficiently knowledgeable then to be great stock pickers.
They failed to seek out and truly learn how to invest properly and then failed to develop any type of investment system. Of course they were going to fail. Yet learning how to invest and make significant returns upward of 20% to 25% a year is not difficult at all.
It's either wrong choices about learning the wrong investment systems or laziness that causes the overwhelming majority of do-it-yourselfers to fail. But it doesn't need to be that way at all. There was an article in last month’s Economist that stated that the belief that more leisure time leads to increased happiness was a myth. Instead, the article revealed that people predominantly used excess leisure time to watch more TV rather than engage in any activity that really improved their outlook on life.
There was an article in the January, 2007 Economist that claimed the belief that more leisure time leads to increased happiness was a myth. Instead, the article revealed that people predominantly used excess leisure time to watch more TV rather than engage in any activity that really improved their quality of life.
However, I don’t agree with the conclusion of the Economist study. All it would take is a simple re-adjustment of perspective, I believe, to change that conclusion. For example, if it was mandated that people could not use their extra leisure time to watch TV but must engage in activities that require human interaction, then more people would have dinner with their friends, go to a play, concert or sporting event, enjoy a pick-up basketball game with their kids, and so on. I guarantee you that the study would conclude something different if this were the case. It’s just a matter of taking personal responsibility for one’s happiness.
In investing, the same rules apply. I’ve read and heard way too many stories where people’s retirements were ruined because they handed their money over to another person at an investment firm. As the financial consultant proceeded to lose all of the client's money, he or she continuously told the client not to worry because “stock markets go down but always come back” while never once admitting that the loses were due to poor decisions. By the time these clients finally decided to pull their accounts, many times they had already lost USD $500,000 or more. I’m not really sure why people are willing to work so hard to save so much money but yet so cavalierly give their money to someone else to invest for them. But they do.
If you take charge of your own investment life, I guarantee you that your results will be better than you ever could have imagined.
They might not improve right away, but over time, they will. Remember, this is a lifelong investment you will be making so you must give yourself a couple of years to judge the returns of your efforts. In order to achieve exceptional results, there are no shortcuts. In investing, however, people seek shortcuts all the time.
They pay thousands of dollars to newsletters to tell them exactly what stocks to buy and curse them when they lose money. They pay tens of thousands of dollars to their financial consultants every year and curse them when they lose them money. It is quite odd to me that the most controlling of people that will pour their hearts and souls into their careers and work extra hours because they do not trust their co-workers to do the job “right”, will turn around and so easily concede control of the management of the wealth that they worked so hard to create.
Many times I hear people claim, “I don’t know anything about investing, so I’m going to let the experts handle it”, and consequently hand their money to Merrill Lynch, UBS, or Goldman Sachs to manage. This notion is just plain silly for two reasons. Consider that most people have undergone at least 12 years of schooling. The most important class you could have ever taken during those 12 years would have been one about creating wealth and investing, but since no traditional institutions of education offer such a class, you must be willing to take one additional class to secure the rest of your financial life.
If we consider the fact that a the hours of a 16 week college class that met four days a week for 1.5 hours a class, or 96 hours of learning, is probably sufficient to set one on the path to significantly greater financial returns, it’s just plain silly that the overwhelming number of people make excuses that they just don’t have this kind of time.
The second reason this notion is so silly is that most likely, your financial consultant and the money manager he or she utilizes barely know more about investing than you do. 98% of money managers peg their portfolio to the major domestic index in their country, so this is something you could do in your sleep. Next time you meet with your financial consultant, take several hours before the meeting to study the global economy and use your knowledge to seize control of the conversation.
Ask what are the best asset classes for 2007 and why. Ask what emerging nations in the Middle East and Russia are likely to do with their massive petrodollar surpluses and how their actions are likely to move global markets. Ask them about the dynamics of the dollar, Euro, and pound sterling currency markets and how this influences how your portfolio is allocated. Most people don’t realize how little their financial consultants really know because they don’t know the right questions to ask.
Consider this. How many clients does your financial consultant have? 50? 100? 300? If you still think that you don’t have the time to learn, consider that your consultant most likely doesn’t have much time for you either. If you really want to make progress with your financial future, it is up to you to find the time. Several thousand or even several hundred dollars invested in courses and education that will teach you how to invest is money much better spent than paying tens of thousands of dollars in fees year after year after year to someone merely to achieve mediocre returns.
And what’s my advice for the type of courses/ books you should seek? With the increasing accessibility to information that is highly correlated to significant returns, I would most definitely concentrate on the longtail of investment strategies – those strategies that have evolved with the evolving information landscape and technology to leverage information to identify stocks best poised to explode higher versus outdated traditional fundamental and value investing strategies. That would be a good place to start.
Most people who try to do it themselves invest on a hot stock tip from their friend or from an unqualified financial consultant. Then when they lose money, they tell themselves it's much better to allow someone else to handle their money. However,that's because they never took the time to learn a proper investment system before making the plunge into the global stock markets. Learn a proper system first and you'll be well on your way to establishing financial freedom.
When I tell people that self-reliance is the quickest path to achieve financial freedom when it comes to investing, many people look at me like I'm crazy. In fact, I know a lot of people that told me they handed their money over to a firm after trying to manage their own portfolio and sustaining significant losses. But every person that had unsatisfactory results took the plunge without adequate preparation. They listened to the pundits on MSNBC, watched the Bloomberg Report, and read the Wall Street Journal and thought that they were sufficiently knowledgeable then to be great stock pickers.
They failed to seek out and truly learn how to invest properly and then failed to develop any type of investment system. Of course they were going to fail. Yet learning how to invest and make significant returns upward of 20% to 25% a year is not difficult at all.
It's either wrong choices about learning the wrong investment systems or laziness that causes the overwhelming majority of do-it-yourselfers to fail. But it doesn't need to be that way at all. There was an article in last month’s Economist that stated that the belief that more leisure time leads to increased happiness was a myth. Instead, the article revealed that people predominantly used excess leisure time to watch more TV rather than engage in any activity that really improved their outlook on life.
There was an article in the January, 2007 Economist that claimed the belief that more leisure time leads to increased happiness was a myth. Instead, the article revealed that people predominantly used excess leisure time to watch more TV rather than engage in any activity that really improved their quality of life.
However, I don’t agree with the conclusion of the Economist study. All it would take is a simple re-adjustment of perspective, I believe, to change that conclusion. For example, if it was mandated that people could not use their extra leisure time to watch TV but must engage in activities that require human interaction, then more people would have dinner with their friends, go to a play, concert or sporting event, enjoy a pick-up basketball game with their kids, and so on. I guarantee you that the study would conclude something different if this were the case. It’s just a matter of taking personal responsibility for one’s happiness.
In investing, the same rules apply. I’ve read and heard way too many stories where people’s retirements were ruined because they handed their money over to another person at an investment firm. As the financial consultant proceeded to lose all of the client's money, he or she continuously told the client not to worry because “stock markets go down but always come back” while never once admitting that the loses were due to poor decisions. By the time these clients finally decided to pull their accounts, many times they had already lost USD $500,000 or more. I’m not really sure why people are willing to work so hard to save so much money but yet so cavalierly give their money to someone else to invest for them. But they do.
If you take charge of your own investment life, I guarantee you that your results will be better than you ever could have imagined.
They might not improve right away, but over time, they will. Remember, this is a lifelong investment you will be making so you must give yourself a couple of years to judge the returns of your efforts. In order to achieve exceptional results, there are no shortcuts. In investing, however, people seek shortcuts all the time.
They pay thousands of dollars to newsletters to tell them exactly what stocks to buy and curse them when they lose money. They pay tens of thousands of dollars to their financial consultants every year and curse them when they lose them money. It is quite odd to me that the most controlling of people that will pour their hearts and souls into their careers and work extra hours because they do not trust their co-workers to do the job “right”, will turn around and so easily concede control of the management of the wealth that they worked so hard to create.
Many times I hear people claim, “I don’t know anything about investing, so I’m going to let the experts handle it”, and consequently hand their money to Merrill Lynch, UBS, or Goldman Sachs to manage. This notion is just plain silly for two reasons. Consider that most people have undergone at least 12 years of schooling. The most important class you could have ever taken during those 12 years would have been one about creating wealth and investing, but since no traditional institutions of education offer such a class, you must be willing to take one additional class to secure the rest of your financial life.
If we consider the fact that a the hours of a 16 week college class that met four days a week for 1.5 hours a class, or 96 hours of learning, is probably sufficient to set one on the path to significantly greater financial returns, it’s just plain silly that the overwhelming number of people make excuses that they just don’t have this kind of time.
The second reason this notion is so silly is that most likely, your financial consultant and the money manager he or she utilizes barely know more about investing than you do. 98% of money managers peg their portfolio to the major domestic index in their country, so this is something you could do in your sleep. Next time you meet with your financial consultant, take several hours before the meeting to study the global economy and use your knowledge to seize control of the conversation.
Ask what are the best asset classes for 2007 and why. Ask what emerging nations in the Middle East and Russia are likely to do with their massive petrodollar surpluses and how their actions are likely to move global markets. Ask them about the dynamics of the dollar, Euro, and pound sterling currency markets and how this influences how your portfolio is allocated. Most people don’t realize how little their financial consultants really know because they don’t know the right questions to ask.
Consider this. How many clients does your financial consultant have? 50? 100? 300? If you still think that you don’t have the time to learn, consider that your consultant most likely doesn’t have much time for you either. If you really want to make progress with your financial future, it is up to you to find the time. Several thousand or even several hundred dollars invested in courses and education that will teach you how to invest is money much better spent than paying tens of thousands of dollars in fees year after year after year to someone merely to achieve mediocre returns.
And what’s my advice for the type of courses/ books you should seek? With the increasing accessibility to information that is highly correlated to significant returns, I would most definitely concentrate on the longtail of investment strategies – those strategies that have evolved with the evolving information landscape and technology to leverage information to identify stocks best poised to explode higher versus outdated traditional fundamental and value investing strategies. That would be a good place to start.
Most people who try to do it themselves invest on a hot stock tip from their friend or from an unqualified financial consultant. Then when they lose money, they tell themselves it's much better to allow someone else to handle their money. However,that's because they never took the time to learn a proper investment system before making the plunge into the global stock markets. Learn a proper system first and you'll be well on your way to establishing financial freedom.
Tuesday, March 13, 2007
Benefits of Online Stock Trading
The new fad is online stock trading. Online stock trading refers to buying and/or sell securities by the stock investor himself on the Internet as compared to calling the broker and having him or her place the order. There are many benefits to online stock trading that I will discuss here.
Convenience/Quickness - Online stock trading allows you to place your orders from anywhere and at any time. The only piece of equipment needed is a computer. When an investor does online stock trading they save themselves time and money. Calling your broker takes longer and costs the investor more.
Control - With online stock trading the investor has full control of his or her investments. With online stock trading there is no having to explain to your stock broker on why and how long you plan to hold your position.
Efficiency - With online stock trading you can get account balance, positions, real time quote and other information instantly while when calling you broker would take much longer to receive this information.
Online stock trading allows all investors to take advantage of real time news and market movements. In the past when a stock investor had to call his broker it would take much longer to buy or sell and investors could not take advantage.
Convenience/Quickness - Online stock trading allows you to place your orders from anywhere and at any time. The only piece of equipment needed is a computer. When an investor does online stock trading they save themselves time and money. Calling your broker takes longer and costs the investor more.
Control - With online stock trading the investor has full control of his or her investments. With online stock trading there is no having to explain to your stock broker on why and how long you plan to hold your position.
Efficiency - With online stock trading you can get account balance, positions, real time quote and other information instantly while when calling you broker would take much longer to receive this information.
Online stock trading allows all investors to take advantage of real time news and market movements. In the past when a stock investor had to call his broker it would take much longer to buy or sell and investors could not take advantage.
The Three Essential Rules For Profitably Trading On The Stock Market
Profiting from trading stocks is not a matter of luck. Successful traders develop a set of trading rules and diligently stick to those rules, no matter what. Here are the three essential rules that should be part of every trader's strategy.
Rule number one is that you do not know what the market is going to do.
No matter how skilled and how experienced you become, you do not know, with any certainty, what the market is going to do. All you ever have is an estimate, or educated guess, as to the path that the market is following.
Some of the greatest mathematical geniuses of all time have spent many years trying to write a system to accurately predict the ups and downs of the market and they have all failed. The reason why they failed is that there is no system. The market is a mass of individual psychology. It is impossible to predict all the various things that are going to influence that psychology let alone predict what that influence will be.
One of the great temptations for traders, who are experiencing a run of successful estimates, is to believe that they now understand the market. My advice to you, if you are experiencing this delusion, is to take a holiday in a nice, relaxing environment and then come back to trading only when sense has returned to your brain.
Rule number two is to decide, before entering a trade, what your strategy will be if your market estimate is wrong.
The biggest losses in trading occur when the traders have neglected to predetermine their loss cutting strategy or when a trader fails to follow their predetermined loss cutting strategy. Once the emotions of potential loss come into play our sound decision making ability takes a sudden and profound decrease. We start to kid ourselves that we know that the market will turn around and that we won't need to take a loss. If that ever happens to you then it is a good time for you to read rule one again.
If you were in the retail sales business then you would have to spend money buying your stock from the wholesaler in order to have the stock to sell at a retail profit. That is the nature of retailing. I see the inevitable losses in stock market trading as being equivalent to those wholesale purchases and the profitable trades as equivalent to the retail sales revenue. As long as the profits outweigh the losses then you have a sound business.
Of course in retailing you try to minimize the cost of acquisition of your stock. By the same logic, in trading you have a system to minimize the size of each loss and that is what rule two is all about.
Rule number three is to decide, before entering a trade, what your strategy will be if your market estimate is right.
The stock market is a volatile entity. You may be in profit today but if you don't collect that profit then it could turn into a loss tomorrow. For this reason you need a strategy for collecting your profit.
In discussing rule two I spoke about the psychological pressures and influences that you experience when you are in loss. Well the psychological issues are just as prevalent when you are in profit. I have seen so many new traders who fall victims to greed and hold their profit for so long that it turns into a loss before they collect a single cent.
Remember rule one; you don't know what the market is going to do. So make sure that you have a predetermined profit collecting strategy and that you have the strength of character to stick to it when the time comes.
The three rules above should be the first three rules in your personal trading system. If you can't accept and abide by these rules then I suggest that you stay away from trading.
Rule number one is that you do not know what the market is going to do.
No matter how skilled and how experienced you become, you do not know, with any certainty, what the market is going to do. All you ever have is an estimate, or educated guess, as to the path that the market is following.
Some of the greatest mathematical geniuses of all time have spent many years trying to write a system to accurately predict the ups and downs of the market and they have all failed. The reason why they failed is that there is no system. The market is a mass of individual psychology. It is impossible to predict all the various things that are going to influence that psychology let alone predict what that influence will be.
One of the great temptations for traders, who are experiencing a run of successful estimates, is to believe that they now understand the market. My advice to you, if you are experiencing this delusion, is to take a holiday in a nice, relaxing environment and then come back to trading only when sense has returned to your brain.
Rule number two is to decide, before entering a trade, what your strategy will be if your market estimate is wrong.
The biggest losses in trading occur when the traders have neglected to predetermine their loss cutting strategy or when a trader fails to follow their predetermined loss cutting strategy. Once the emotions of potential loss come into play our sound decision making ability takes a sudden and profound decrease. We start to kid ourselves that we know that the market will turn around and that we won't need to take a loss. If that ever happens to you then it is a good time for you to read rule one again.
If you were in the retail sales business then you would have to spend money buying your stock from the wholesaler in order to have the stock to sell at a retail profit. That is the nature of retailing. I see the inevitable losses in stock market trading as being equivalent to those wholesale purchases and the profitable trades as equivalent to the retail sales revenue. As long as the profits outweigh the losses then you have a sound business.
Of course in retailing you try to minimize the cost of acquisition of your stock. By the same logic, in trading you have a system to minimize the size of each loss and that is what rule two is all about.
Rule number three is to decide, before entering a trade, what your strategy will be if your market estimate is right.
The stock market is a volatile entity. You may be in profit today but if you don't collect that profit then it could turn into a loss tomorrow. For this reason you need a strategy for collecting your profit.
In discussing rule two I spoke about the psychological pressures and influences that you experience when you are in loss. Well the psychological issues are just as prevalent when you are in profit. I have seen so many new traders who fall victims to greed and hold their profit for so long that it turns into a loss before they collect a single cent.
Remember rule one; you don't know what the market is going to do. So make sure that you have a predetermined profit collecting strategy and that you have the strength of character to stick to it when the time comes.
The three rules above should be the first three rules in your personal trading system. If you can't accept and abide by these rules then I suggest that you stay away from trading.
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