Clearly, anyone who trades does so with the expectation of making profits. We take risks to gain rewards. The question each trader must answer, however, is what kind of return he or she expects to make? This is a very important consideration, as it speaks directly to what kind of trading will take place, what market or markets are best suited to the purpose, and the kinds of risks required. Let s start with a very simple example. Suppose a trader would like to make 10% per year on a very consistent basis with little variance. There are any number of options available. If interest rates are sufficiently high, the trader could simply put the money in a fixed income instrument like a CD or a bond of some kind and take relatively little risk. Should interest rates not be sufficient, the trader could use one or more of any number of other markets (stocks, commodities, currencies, etc.) with varying risk profiles and structures to find one or more (perhaps in combination) which suits the need. The trader may not even have to make many actual transactions each year to accomplish the objective. A trader looking for 100% returns each year would have a very different situation. This individual will not be looking at the cash fixed income market, but could do so via the leverage offered in the futures market. Similarly, other leverage based markets are more likely candidates than cash ones, perhaps including equities. The trader will almost certainly require greater market exposure to achieve the goal, and most likely will have to execute a larger number of transactions than in the previous scenario. As you can see, your goal dictates the methods by which you achieve it. The end certainly dictates the means to a great degree. There is one other consideration in this particular assessment, though, and it is one which harks back to the earlier discussion of willingness to lose. Trading systems have what are commonly referred to as drawdowns. A drawdown is the distance (measured in % or account/portfolio value terms) from an equity peak to the lowest point immediately following it. For example, say a trader?s portfolio rose from $10,000 to $15,000, fell to $12,000, then rose to $20,000. The drop from the $15,000 peak to the $12,000 trough would be considered a drawdown, in this case of $3000 or 20%. Each trader must determine how large a drawdown (in this case generally thought of in percentage terms) he or she is willing to accept. It is very much a risk/reward decision. On one extreme are trading systems with very, very small drawdowns, but also with low returns (low risk ? low reward). On the other extreme are the trading systems with large returns, but similarly large drawdowns (high risk ? high reward). Of course, every trader?s dream is a system with high returns and small drawdowns. The reality of trading, however, is often less pleasantly somewhere in between. The question might be asked what it matters if high returns in the objective. It is quite simple. The more the account value falls, the bigger the return required to make that loss back up. That means time. Large drawdowns tend to mean long periods between equity peaks. The combination of sharp drops in equity value and lengthy time spans making the money back can potentially be emotionally destabilizing, leading to the trader abandoning the system at exactly the wrong time. In short, the trader must be able to accept, without concern, the draw-downs expected to occur in the system being used. It is also important to match one's expectations up with one's trading timeframe. It was noted earlier that in some cases more frequent trading can be required to achieve the risk/return profile sought. If the expectations and timeframe conflict, a resolution must be found, and it must be the questions from this expectations assesment which have to be reconsidered, since the time frames determined in the previous one are probably not very flexible (especially going from longer-term trading to shorter-term participation). Source: http://www.ArticlePros.com/author.php?John Forman
Read More......There are companies providing more freedom there is only on paper as a facade for the flagellation of the investments and the earth, etc., with the promise of extremely high returns, but in reality they are in the vicinity of May-value . Thousands of investors were caught by the country as investment scams in the county of Kent in the vernacular known as Kent, where the land fraud very black, and the perseverance to convince the providers of money and verbally bash in some of the money - in most cases with the line that the countries of the investors "on the ground floor, and stressing the fact that they immediately lose again, in cash or on the" chance "in general. This version of a return of investment is an example of the kind of story can be woven to these systems. Whatever the theme of the basic idea is for you part of a huge money. In addition, the cheater or the so-called cheater go from approaching the matter to someone else for the reason that you connect to an exclusive group, the benefits of an investment, based on the secret. The simple rule for investing in the earth is the highest possible profit, the higher the risk is high. If someone claims that the high level of investment is not a danger not to believe. Remember this - If you pursue with a high-technology companies. Not an immediate decision. Information in writing to the first company, the sales person and the investment. Is not part of your money until you are looking for a professional (lawyer, accountant or a broker or lawyers) for the consultation? One of the easiest to identify and deliver high performance with low-risk country investment fraud, because they always offer returns can never be achieved through legitimate investments not now, not tomorrow not ever. Some of these types of fraud occur in the United Kingdom has recently launched the fraud in the county of Kent, Sussex and London, commonly known as the Kent Land Scam, London Land Scams and fraud Sussex countryside. Article source: www.arcog.com
Read More......You always have interest in investing in a company, but because you are afraid of a bad choice and the loss of your investment. However, there are few opportunities for companies to evaluate, to reduce the risk you take if you are considering investing. Of course, the risk is not eliminated, but if you consider what a company worth investing in then more than likely that your response, if the company is successful or not, before your United States dollars invested. The following tips will help investment. Investment Management Tip # 1 To determine if a company worth investing in it or not, you have management because a company is as successful as its administration. That's why you want to assess whether the management of, rational and able to make the right decisions in order to prevent the money and the money lost. This is obviously a simple question but the answer is a bit difficult. Investment Consulting Business Plan # 2 A business plan, which is well built and displays positive, negative, and how business and management problems within the company is very important. A good business plan shows that management of white, where the company where he wants and what to do for you. Make sure you have a view on a company's business plan before investing. Investment Tip # 3-The return on investment The return on equity or return on investment is also critical if you are considering an investment in a company. Of course, the ratio of capital to finance can be confusing, but if you ROE, and other economic factors, you should be able to say whether the company make money or lose. Investment Advisory # 4 of space for growth Make sure the company offers a place for growth in the market is also important. A company that has little competition is better, but a company with an average amount of competition and plan for the number one is ok. If your search. If you are interested in investing in a company, you must take the time and the evaluation of companies, the accounts, to talk and get answers to your questions to your satisfaction. In fact, it's your money and you are not only a business-quality. So, sure, and confidence in the company and secure evidence and help you reduce the risk to invest in a company. Catalog: Finance | Investments Article Source :www.arcog.com Catalogue: Finance | Investing Title: What Makes A Business Worth Investing In? By: Craig Rowe
Read More......Investing can be confusing, especially for beginners. Getting some basic tips can help a beginning investor to make informed choices that fit their needs. Everyone has a different purpose in investing and that plays a major influence on how you invest. Here are some things beginners should know before investing. 1. Understand that there are no fixed rules for investing. There are no guarantees and no perfect way to invest. 2. Informed decisions. Before investing in any manner whatsoever, you should fully understand how your investment and all the details of the transaction. 3. Make a simple plan for your goals and needs. This will help you determine which investments to make and how much money to invest. These three tips are for general investment, but many people are looking to invest in the fast world of scholarship. The above tips are a good start, but the following tips to help you who are interested in investing in shares. 1. Look at the value of the shares instead of the price. Low-cost stocks too low for a reason. Look at the whole picture. See why the price is low, and if there is a possibility to increase. 2. Check the companies return on equity. This is the profit after taxes divided by net assets. It is important to see a trend of increasing return on equity. 1. The risk of spread. You may not use all their money in stocks with a high risk. Try a little less risk and higher risks. This is the best way to keep your money. 2. Understanding the fundamentals of stock prices. Prices up or down, depending on future projections. These four tips can help a beginning investor to invest in the stock market. Whatever type of investment you are looking for knowledge is the key to success. These short tip lists are just the beginning to understanding investing and maximizing the return on your investment. Continuous learning and trying. Article Source : www.arcog.com Catalogue: Finance | Investments Title: Investing Tips For Beginners By: Stephen Kreutzer
Read More......In today's volatile economy, many people who might have previously been interested in investing their money may have been frightened away. But there are options out there for those who are willing to let their investment ride over the long term: the most reliable of these options is the mutual fund.
In a nutshell, a mutual fund is a collection of stocks, bonds, and money market securities that have been put together in a bundle that is offered as one to investors. The criteria for the selection within that bundle are the past performances of its individual participants and the ultimate goal of the fund. Because the success of the mutual fund does not rest on the performance of any single one of its components, it is a more reliable means of investing over the long term than investing in individual stocks.
The downside of mutual fund investing, if there is one that merits pointing out, is that it is definitely meant to be a long term commitment. The stock markets can bring a return on investment of 10-12 %, even over a relatively short amount of time, whereas mutual funds will grow 8 - 9% a year.
Investors who are interested in making day trades or only want to stay in the market for short amounts of time will not be good candidates for mutual fund investing. However, because of their inherent diversity, mutual funds are steadier over the long term and will attract more conservative folks who are willing to be patient and wait longer for their rewards.
There are different types of mutual funds available on the market today, and a good professional investment manager can help you select what may be right for your individual needs.
-- Bond mutual funds are made up of strictly bond components; these bonds may come from a variety of sources including federal, public company, or state government. Bonds are a steady type of investment since they are not as subject to the volatility of the stock market.
-- Stock, or Equity funds are comprised entirely of stock offerings. Because it depends solely on stock market activity, it is entirely subject to the ups and downs that happen on Wall Street. However, the long term prospects of greater return on investment are better.
Whatever type you think you may want to go with, you should always check out a fund's "prospectus." The prospectus gives information about the fund's components, its past performance, its goals, any fees associated with it, risks, who is managing it, and all other facets concerning it. Because the prospectus is a legal document, the investor can be assured of the validity and correctness of its contents.
If you are new to investing and need solid advice, make sure to consult with a professional investment manager who can help you make good decisions. It's your money: use it wisely.
article source:
http://www.artipot.com/articles/350365/mutual-fund-investing-for-beginners.htm
By Chris Latter You have a good education before you invest investment. In the head long rush to investment losses that could win. You need a basic understanding and knowledge to succeed. You have an idea to develop, so you see what you usually do not. Try some online education, if you are a full-time employees and have less time to spend. If you have more free time and try some things, newspapers and television. If you want the simplest way possible, then a securities broker who experienced enough and trustworthy to you in your financial planning. Before the start of the investment, you must be a plan for the acquisition of shares, which you can choose to invest in the lowest level possible. Reinvestment of dividends can do wonders for you. This will help to benefit more in the coming years. Get a ship in an investment club member, and try to unite all the money to invest, take the help of other club members and try to be a portfolio of cash, small plants. This would help to build a good financial performance. If you have inherited some money or have a tax refund, the first thing you should invest. We must not forget the fact that it is never too early to invest, taking into account that on 18th Do your priorities before you invest. You have to decide whether to invest short term or long term. You have the choice of the best area to invest according to their financial goals. Examine the value of stocks, but their price. Populations, at very low cost, which is more beneficial because it could in a short time when the market is there. Try to diversify your investments, you should not invest in shares of high value with all they have to invest, in some populations with low risk and high risk, some, this is the right way. You must learn the strategies of various market trends and scenarios for you to deal with all kinds of situation effectively. You should know that the future projections of population, which invest in order to consider before they invest, to see whether the organization has high sincere management, because the leadership is very important to the company to grow. Therefore keep the above things in mind before you invest. Never, because learning is the key. Can an expert, but still too much time and effort to create new strategies and new perspectives for your success. Finally, investment is the key to the door, the fact that the financial independence you desire. Article Source: http://EzineArticles.com/?expert=Chris_Latter
Read More......By Andrew Kasch BetonMarkets.com is the leading fixed odds financial services provider in the world. It is fully licensed worldwide, you can use more than 18,000 trades per day of 130,000 registered users. The website has processed over 15 million transactions since 2000. Concrete Markets is a place where dealers and the best newspapers speculate on movements in major financial markets of the world, without investing in stocks or currencies. BetonMarkets.com used fixed odds betting system, as opposed to the spread and the binary system of betting that in a real financial bargain. In some ways it is as easy as with a regular bookmaker bets, only that it is a demanding and complex area of financial markets. If you are interested in venturing in trade, finance, concrete Markets is the perfect place to gain experience in the speculation. As already mentioned, will be able to view the performance of financial markets without the purchase of shares or currencies. They are only playing the results of your risk is limited to a fixed amount of money initially. Not only do games in concrete Markets is tax free. The only additional costs are banking that needs to be done, if ever, and received commission concrete Markets, whether you win or lose. BetonMarkets.com offers a variety of graphics. The price for the stakes are considered on the basis of mathematical algorithms and some other methods of calculation, although none of them are fully disclosed. If you are still confused about exactly how concrete markets work, you can sign up for a free virtual money worth 10,000 euros, you can gain experience before immersion in the reality with real money. The minimum deposit is 10 euros per account. They offer a bonus of 20 euro bets, if you become a member now. The advantage of betting in BetonMarkets.com is that because it is a fixed odds betting, which is fully aware of how much you earn and how much will the waste. Apart from the best traders easily and are easy to understand compared to other trading platforms. Anyone can start betting with $ 10. The bets can be from 5 euros to 50,000 euros. You have the choice between different types of markets such as forex currency pairs, currency, U.S. and the United Kingdom and the stock indices. It is advisable to play on the market, most of them know. Bets can be double, betting limits for the end. Most traders to play twice the stakes, as the term suggests, is to double the amount of their income, if the speculation about the fluctuations in the financial markets is correct. End less popular bet is a bet, because it is risky, but more conservative at the same time, depending on the personality trading. However, it is the most advanced operators, because it is a flexible application that allows you to view the exact period and ranges. Other types of bets are the boundaries that are very similar to gambling and betting spread end seems almost real trade. My final word of advice is to visit [http://www.betonmarkets-strategy.com]http://www.betonmarkets-strategy.com, a free information website where you will learn the ins and outs of successful [http://www.betonmarkets-strategy.com/strategy1.htm]BetonMarkets strategies in about an hour of leisurely browsing. Article Source: http://EzineArticles.com/?expert=Andrew_Kasch
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