Stock Market Books

We Need to Take Control of our Investments

Free Online Articles Directory

Why Submit Articles?
Top Authors
Top Articles
FAQ
AB Answers

Publish Article

0 && $.browser.msie ) {
var ie_version = parseInt($.browser.version);
if(ie_version Hello Guest
Login

Login via

Register
Hello
My Home
Sign Out

Email

Password


Remember me?
Lost Password?

Home Page > Finance > We Need to Take Control of our Investments

We Need to Take Control of our Investments

Edit Article |

Posted: Nov 16, 2008 |Comments: 0
|

Share

]]>

In the wake of the financial crisis—when the stock market has fallen and risen as much as 900 points in a single day—a lot of folks are wondering what to do with their money.

Some people turn to U.S. Treasury bills and bonds, which have traditionally been viewed as the safest of investments because of their government guarantee. This “flight to safety,” at one point, drove the yield on the three-month U.S. Treasury bill down to 0% for the first time since January 1940. When you factor in inflation, the “real” return was below 0%—meaning investors were willing to lose money in exchange for a safe place to park their money.

Another alternative is literally stuffing cash under the mattress. On the surface, it doesn’t seem like a bad idea. Many bank accounts are now yielding as much as 3%, and the FDIC has raised its insurance ceiling on deposits. At the same time, the U.S. government has rolled out a temporary insurance program to prevent money market funds from “breaking the buck,” or falling below $1 per share.

But, cash won’t offer any returns, with consumer inflation hovering around 5% so far in 2008. Cash may not even let you break even.

There are always other options, such as commodities, real estate investment trusts (REITs) and even private equity funds. The problem is, these investments are hard to value, and difficult for individual investors like us to understand and invest in. And these investments are subject to the same economic pressures as everything else.

So, we return to what we know – stocks. Benjamin Graham (the godfather of value investing and Warren Buffett’s mentor) once wrote that when we’re challenged by an investment environment, we should “distill the secret sound of investment” into three words: margin of safety.

To Graham, staying within the margin of safety simply meant buying a stock only when it is worth more than its market price. How much more depends on the type of stock. For example, for a high-quality stock, you might want to pay a maximum of 90 percent of what you consider the stock’s actual value. But for a troubled stock, you might want a greater cushion, choosing to pay no more than 50 percent of what you consider the stock’s actual value.

Those are wise words in today’s market envrionment, when all stocks are down, but only some (such as banks) are fundamentally troubled. Indeed, earlier this year, as the market plummeted, Buffett announced that he considers the malaise a buying opportunity.

“To be sure, investors are right to be wary of highly leveraged entities or businesses in weak competitive positions,” Buffett wrote in an October 17 column in The New York Times. ” But fears regarding the long-term prosperity of the nation’s many sound companies make no sense. These businesses will indeed suffer earnings hiccups, as they always have. But most major companies will be setting new profit records 5, 10 and 20 years from now.”

History backs him up: the stock market has always gone up over the long run. From 1951 through 2007, the S&P 500 Index saw positive returns in 44 of 57 calendar years, according to Thomson Financial. At the end of 2007, its 25-year average annual return was 12.83%.

Sure, getting back into the markets now feels risky. But there’s also risk in doing nothing: Due to inflation, $100 left in the bank in a non-interest-bearing account will have a purchasing power of under $74 in 10 years, assuming a hypothetical 3% annual inflation.

The point is, the time to act will be coming soon. Whatever you do, don’t hide. It’s time for all of us to take control of our investments, stay informed, and be ready to pounce on opportunities. As Buffet said, “Be fearful when others are greedy, and be greedy when others are fearful.”

Retrieved from “http://www.articlesbase.com/finance-articles/we-need-to-take-control-of-our-investments-644561.html”

(ArticlesBase SC #644561)

Liked this article? Click here to publish it on your website or blog, it’s free and easy!

Steve Carpenter -
About the Author:

Steve Carpenter founded Cake Financial to help people take control of their investments. Want to learn more? Join Cake Financial today for free =>
http://www.cakefinancial.com

]]>

Questions and Answers

Ask our experts your Finance related questions here…200 Characters left

I want to set up a counselling practice online and from home.I need guidelines and tips to start up. I do not have a capital investment. am a single mom, so short of funds
What do killer whales need to survive ?
Ary to become a billionaire? How about finding a way to make an extra few thousand dollars per month? That might be all that you need…whether to spend it and enjoy life more, or to invest it for eve

Rate this Article

1
2
3
4
5

vote(s)
0 vote(s)

Feedback
RSS
Print
Email
Re-Publish

Source:  http://www.articlesbase.com/finance-articles/we-need-to-take-control-of-our-investments-644561.html

Article Tags:
investing, stock market, risk, take control, personal finance, investing basics, investment, stock investment, investment opportunities

Related Articles

Latest Finance Articles
More from Steve Carpenter

Stock Market

The stock market. To some it’s a puzzle. To others it’s a source of profit and endless fascination. The stock market is the financial nerve center of any country. It reflects any change in the economy. It is sensitive to interest rates, inflation and political events. In a very real sense, it has its fingers on the pulse of the entire world.
Taken in its broadest sense, the stock market is also a control center.

By:
Michael Newmanl
Businessl
Sep 29, 2009
lViews: 110

A Look At Some Important Stock Market Basics

Investment beginners can be confused as to where to invest their money because of the sheer size of the stock market. It appears to many people as a huge amount of options without any clarity to direct them in the investing process. Education is definitely the way to go when…

By:
Tony H.l
Financel
May 14, 2008
lViews: 114

Stock Investing & Investing News – BusinessWeek

This report is going to explain or attempt to give the stock market investors a basic one-on-one interview with a real estate portfolio manager who has consistently made a profit on 100% of the investment products that were actively chosen and managed. Never a loss, always tax advantaged and sheltered.

By:
Jennyl

Finance>
Day Tradingl
Oct 18, 2009

Investment Management Strategy: Seven Principles for Success

Investing is not a competitive event, ever. You don’t need to beat the market. You need to accomplish a set of personalized goals. Avoid what the crowd is doing and shun investment products. Consumers buy products; Investors buy securities. Avoid hindsightful analysis, and uninformed (or salesperson) criticism.

By:
Steve Selengutl

Finance>
Investingl
Sep 20, 2006
lViews: 699

Corporate Tax And Capital Structure In An Emerging Market : An Empirical Analysis Of Quoted Firms In Nigeria

Abstract: The purpose of this study is to carry out empirical testing using dynamic panel data methodology, to analyse the relationship between corporate taxation and debt. The choice of Nigeria is that Nigeria economy is a strong force in Africa. We adapt a standard model of capital choice under corporate taxation. We controlled for other leverage determinants. Our dataset covers a cross-section of 60 quoted firms from Nigerian stock markets over a ten year period (1996-2005), we find that

By:
Okoyeuzu chinwel
Financel
Mar 02, 2010
lViews: 367

THE IMPACT OF NIGERIAN STOCK EXCHANGE CRISES ON THE NIGERIAN ECONOMY

An efficient capital market mobilizes savings and allocates a greater proportion to those companies with the highest prospective rate of returns after giving due allowance for risk. This allocative function is critical in determining the overall growth of the economy. If capital resources are not provided to those economic areas, especially industries, where demand is growing and which are capable of increasing production and productivity, the rate of expansion of the economy invariably suffers.

By:
Stephen Udeh Njokul

Education>
College and Universityl
Dec 15, 2010

International Trade and Finance

The explosive growth of international financial transactions and capital flows is one of the most far-reaching economic developments of the late 20th century.

By:
loveleenchawlal
Businessl
Dec 21, 2008
lViews: 424

No Nonsense Muscle Building Free Download-Vine Delmonte’s no-nonsense muscle building tells us how to do the exercise

Do you require to regress weight? Do you deprivation to body your muscles?

By:
Donald Sadersl
Financel
Dec 29, 2010

Mental Debt Freedom Pdf

Mental Debt Freedom Pdf Mental Debt Freedom Pdf

By:
Gillianeynoldsl
Financel
Dec 29, 2010

Broker Nightmare Hoax

Broker Nightmare Hoax Broker Nightmare Hoax

By:
KellPricel
Financel
Dec 29, 2010

Stock Assault 2.0 Secret

Stock Assault 2.0 Secret Stock Assault 2.0 Secret

By:
Inagrid Palerul
Financel
Dec 29, 2010

The Forex Ultimat System Rapidshare

The Forex Ultimat System Rapidshare The Forex Ultimat System Rapidshare

By:
Inagrid Palerul
Financel
Dec 29, 2010

Stock Options are the best Expenditure of money intended for Novice Investors Finding out Simple tips to Expand Their funds

The idea is well known that people that happen to be searching long lasting growth with their cash obtain a couple of main goals as their critical aim for investing.

By:
RichardMassathonyl
Financel
Dec 29, 2010

Fap Turbo Expert Guide Settings

Fap Turbo Expert Guide Settings scam

By:
Inagrid Palerul
Financel
Dec 29, 2010

Auto Insurance Coverages

What you don’t know about insurance could be a disaster. Find out what you didn’t know but need to know.

By:
Chance Smithl
Financel
Dec 29, 2010

We Need to Take Control of our Investments

As the economy falters and the stock market slides, we need to take control of our investments.

By:
Steve Carpenterl
Financel
Nov 16, 2008

Add new Comment

Your Name: *

Your Email:

Comment Body: *

Verification code:*

* Required fields

Author Navigation

My Home
Publish Article
View/Edit Articles
View/Edit Q&A
Edit your Account
Manage Authors
Statistics Page
Personal RSS Builder

My Home
Edit your Account
Update Profile
View/Edit Q&A
Publish Article
Author Box

Steve Carpenter has 1 articles online

Contact Author

Subscribe to RSS

Print article

Send to friend

Re-Publish article

Articles Categories
All Categories

Advertising
Arts & Entertainment
Automotive
Beauty
Business
Careers
Computers
Education
Finance
Food and Beverage
Health
Hobbies
Home and Family
Home Improvement
Internet
Law
Marketing
News and Society
Relationships
Self Improvement
Shopping
Spirituality
Sports and Fitness
Technology
Travel
Writing

Finance

Accounting
Banking
Credit
Currency Trading
Day Trading
Debt Consolidation
Insurance
Investing
Loans
Mortgage
Personal Finance
Real Estate
Taxes
Wealth Building

]]>

Need Help?
Contact Us
FAQ
Submit Articles
Editorial Guidelines
Blog

Site Links
Recent Articles
Top Authors
Top Articles
Find Articles
Site Map

Webmasters
RSS Builder
RSS
Link to Us

Business Info
Advertising

Use of this web site constitutes acceptance of the Terms Of Use and Privacy Policy | User published content is licensed under a Creative Commons License.
Copyright © 2005-2010 Free Articles by ArticlesBase.com, All rights reserved.

Real estate investing has offered investors much better returns than most other investment options. Real estate investment is one of the safest investments available. The security of real estate investments is becoming more and more increased these days. Real estate investment is a safe way to start making your personal wealth and retirement finance provided if you act wisely. Real estate investing offers excellent long term returns and sometimes even short term gains. Real estate investing can bring you high profits if you follow certain tips.

Many countries offer wide real estate investment opportunities. Real estate investors can easily find excellent profits in rentals, rehabs and high-end properties. Buying properties to use as rentals is very successful real estate investment strategy.  The high-end properties have powerful demand among real estate investors, especially in the most desirable areas, such as Paris. The most successful real estate investment strategy is rehabs. Rehabs are also the most risky form of real estate investments. If there is huge demand for finished real estate properties, the opportunity for real estate investors increases widely. Finished real estate properties provide excellent opportunity for real estate investors who are willing to rehab and then rent or sell properties. Real estate investors who want to sell a property after grasping it for only a few years can benefit from this type of real estate investment strategy. Real estate investors who rehab properties can either sell or rent the rehabbed properties for a worthy premium. Real estate investors can buy a run-down property in a main location at a cheap price, remodel or modernize it and then resell or rent it successfully.

Flipping, Bargain purchase investment strategy, Increase value investment strategy, Double-digit cap rate investment strategy, and Commercial Real Estate Investment strategy are the other real estate investment strategies. Flipping involves buying and selling real estate property without actually taking ownership of the property. Flipping enables you to make money with real estate without possessing the property. Bargain purchase investment strategy involves purchasing real estate property for at least 20% less than the current market value. Increase-value investment strategy involves buying a real estate property for its current market value, remodeling the property in order to increase its value by at least 20%, and then selling it. Double-digit cap rate investment strategy involves buying a property having a capitalization rate of 10% or more. Commercial Real Estate Investment involves buying commercial properties that are bigger than a 4 unit apartment building. It is better for the real estate investors who are beginners in the field to avoid commercial real estate investment strategy. On the other hand, if you have experience in real estate investments, you can go for commercial real estate investment as the competition is much less.

Different real estate strategies require different amounts of time. For example rehab is really time-consuming. Real estate investors must not choose a time-consuming investment strategy if you cannot spend much time for real estate business. Some real estate strategies require huge amounts of cash. For example, to buy foreclosure properties whereas buying a property at auction requires little or no cash.  The different real estate investment strategies provide different benefits. It is up to you to choose the strategy you feel more comfortable with. But make sure you choose the right strategy that best suits you, and work accordingly.

When buying Real Estate you need tounderstand the market environment in that area. Understand the implications of the area and the history of the property that you are examining. Be aware of other developments planned for that area. Research the area before you invest. The more knowledge you have, the better prepared you are! For example: reading this article is a good start! Learn everything you can about that Real Estate marketplace. Do your homework on the property! Research the property and the surrounding neighborhood at the local city, town or municipal hall. Ask neighbours in the area about the uses of the property and its impact on them. Do a title search any outstanding charges, liens or covenants. Do your own study on local pricing. Call a few successful Realtors and Appraisers. Most are quite happy to help. Remember when getting information, get conformations in threes. This means have three separate sources of information so you can identify facts from fiction. As a potential Investor, look to see if the price of one piece of Real Estate is accelerating faster in one area as compared in other areas. Check to see how the average price compares with the average price on similar properties in other neighboring towns or cities, the development costs, constructions costs and most importantly the vacancy rate and the potential return on investment. Always be ahead of changes in the Real Estate market. When the market cycle turns downward, sales fall off and you will not get the price you planned. Many people are finding this out right now! Understanding information is power! The more you know, the more you can evaluate the return on your investment. This will help you negotiate the purchase price of the property. Just because someone wants $500,000 doesn’t mean they won’t sell it for less, given a convincing presentation on current market values. Real Estate Agents are a great source of information. Always do your own research to determine fair market value. Real Estate Agent commissions are always negotiable. Just because they ask for 5-10% of the sale price doesn’t mean that you can’t negotiate. If you want to negotiate fees with Real Estate Agents, always research the Real Estate commissions charged by Real Estate Agents in the area. Remember, the more you are willing to pay in Real Estate commissions, the harder your Realtor is prepaid to work on your behalf. Learn to develop a sense for fair market values. You can do this by taking multiple similar local properties and that have sold and finding an average price. For example, take 5 similar properties in the area and divide the sum of their values by 5. So anything that is less than the average would be a good deal and anything over would be paying too much. Of course, don’t make your decision on price only. Not always, but most times there is a reason why the asking price could be lower or higher! MLS.com (Multiple Listing Service) is a great place to find information on Listings as most Real Estate Agents use this site to share listings information with other Real Estate Agents. Local papers are also a great place to look for local Real Estate Information. The internet is also a great place to find local Real Estate information. For more information on local transactions, research the land title Registries. They will carry information on Real Estate transactions that can be used to identify average prices. When striving for the leading edge on investment, look for a catalyst in the area. The increase of development display signs in an area makes a statement to an Investor, that the area maybe ripe for investing. If you are interested in investing or buying and reselling residential Real Estate, keep an eye on new roads, proposed new schools to be built or old schools to be renovated and expanded. If this is happening, you can be fairly sure that Real Estate values in that area, in the near future, will be impacted by supply and demand. The more demand for property in an given area, the more you can resell it for. Don’t be afraid to ask for more than your property is worth! Remember, you can always go down in price but it is hard to go up after you are for sale. Another great thing about asking for more is some people will actually pay it with out bargaining because they FEEL the value is there for them! Looking for and investing into growing communities at the very beginning, is a very profitable time for reselling. New development of shopping malls in either mature or growing communities is a good tell-tale sign for a profitable investment area. Never review Real Estate taxes and government assessment when buying. Learn to spot new developments. Examples: land clearing, surveying for new construction in and around major roadways are pretty good indicators. Also, look for widening of traffic lanes, the installation of turnaround lanes and the installation of new traffic lights. All these activities suggest the possibility of increased property values in the area. If you are looking for new developments, a great place to start is to contact the local town or city road and building department. They will be aware of new and future developments for the area. Another avenue for finding out about new developments is contacting the city, province or state department. Ask when and where new developments will be coming up. Always be aware of the property taxes. If the property tax is lower on the property of interest than others around it, find out why and be prepared for it to increase. To find out information about property taxes you can always call the local Tax Assessor and they can reveal how much the town or city is charging. It is called the mill rate. Keep an eye on school rankings. Remember the better the school does in over all marks; the more people want their children to go and learn there! This creates more of a demand to live in the area. This demand will create an increase in the value of property in that area. Watch the Outskirts. If the properties in a major city or town have become overpriced, the areas on the outer fringes most likely will soon be in demand. Areas in close proximity to major bus and rail transportation are even more desirable. Nearly any area that is about to install a major train stop or a new major bus route will see its property go up in value. There are 6 main groups of Real Estate. They are Industrial, Commercial, Investment, Recreational, Agricultural and Residential. Residential Real Estate is the most common. It has been our experience that people believe that this is the best investment to start. This Real Estate is mainly known as houses, duplexes and condominiums. Commercial property is the second most popular and is for the more sophisticated investor. This type of Real Estate includes shopping malls, strip malls, theatres, retail stores or main line office buildings. Recreational property is the third most popular investment and is usually done by very sophisticated investors and Trust Funds. These are the “get away” locations like hotels, resorts and spas, golf and nature retreats. Industrial properties are the least popular because most people have a difficult time understanding the development and construction process especially for a specific need. You will find large Investment Trust companies and more highly sophisticated buyers involved in these types of projects. Agriculture property surrounding populated areas are a valued investment for land developers. For long term holding properties. Did you know? Usually in a Real Estate transaction, it takes just as much effort to buy or sell a residential property as it does a Commercial property! Most times, the only difference is the number of 0’s at the end. Appraisals are important and you should get one before closing a purchase on a property. Borrowing money is just as important as buying the property. Remember to find the right Lender with an affordable interest rate. Meet Lenders in the local area… They are your business partners. Meet and interview lawyers in the local area. As the Real Estate zoning process is municipally controlled, a Real Estate Lawyer represents your needs to know the municipal idiosyncrasies. Last but not least, meet local Accountants and ask questions about tax implications of buying and selling Real Estate in their area. Property in different states or provinces has different rules when it comes to taxation. A good way to find competent people in lending, law and accounting practices, is to ask a successful Real Estate Agent in that area. You will know who is knowledgeable by how much they advertise and provide creditable information. Those that advertise the most, tend to do the most business. Building strong relationships with competent people gets the job done right. Banks aren’t the only place for money. A Lending Broker is another source however, there could be a price. Understand “Cap Rates”. To understand this definition see capitalization rates on our website under “glossary”. Different Real Estate assets have different asset classes, and depending on the class, can value or devalue the asset. If you are still reading this, good for you! And if not we understand but here is a fun fact. Did you know that the Guinness Book of World Records holds the record for being the book most stolen from Public Libraries? A condominium, or condo, is a form of Real Estate where the specified unit is for the free use and enjoyment of its owner. A specified part of the property and buildings is owned by the strata corporation and the use of and accesses to common facilities are identified as limited common property. The lands upon which the building is located is mostly identified as common property. Condos use what most people call Strata Titles. Look at insurance and understand what you have and don’t have insured. Understand where your unit and or property are located and make sure that all common elements in that area have been covered. Keep everything insured! The last thing that you want is to lose a substantial investment as a result of a fire or earthquake. Surprisingly, this happens a lot more often then people think. Banks and Real Estate Trusties are also a good place to look for Real Estate investments. Another place to look are public auctions. These usually have foreclosure sales, estate sales, etc. at a great price! You don’t need to pay the asking price for a property if you can’t get conventional or high ratio financing. You can ask the Vendor (Seller) to participate in a “Vendor Take Back” second Mortgage. This is the cast when the Vendor (Seller) takes a second mortgage on the property and you can pay it off over a period of time, to be agreed upon the time of sale. “Agreement For Sale” is another method of financing. This is when the Vendor (Seller) retains title in their name and the amount of funds to be paid are calculated in the same manner as with a convention lender and with a specified term. Upon the maturity of the term, the Agreement For Sale must be paid out in full to the Vendor (Seller) and at that point, title is transfer to the buyer or the Agreement For Sale can be renegotiated as long both parties agree. As an additional tip, the renegotiation process should start well in advance of the term due date so as not to jeopardize any part of this process. Land is the one asset base that will out last any generation. Land will always carry a value no matter what happens in the world unlike metals and money. In some places in the world, property is sold under a 99 year lease. Make sure you know what you are buying.  This is why it is so important to learn how to read a land title. When buying Investment Real Estate, be sure to have identified the carrying costs and the length of time required to sustain the mortgage payments. There are four typical ways Investment properties generate cash flow – these are NOI (Net Operating Income), Tax shelter offsets, equity build-up, and capital appreciation. What is a NOI (Net Operating Income)? It is the sum of positive cash flow from rent and other sources of income generated from the property minus the sum of ongoing expenses. What is a tax shelter offset? Tax shelters can happen one of three ways – depreciation, tax credits and carryover losses. These can reduce income tax liability charges against income from other sources. So when looking for investments, some may find a loss attractive! Equity build-up is the increase in the Investor’s equity ratio as the portion of debt service payments devoted to the principal accrued over time. Capital appreciation is the increase in market value of the asset over time, realized as a cash flow when the property is sold. Capital appreciation can be very unpredictable unless it is part of a development and improvement strategy. Learn to manage and evaluate risk in Real Estate. Always verify ownership of property… do a Title search! Learn what Title Insurance is and make sure you get it if you feel you will need it. Make sure when purchasing Real Estate that you get a property survey from a licensed property surveyor and determine that it is acceptable to the local government authority. Obtain an environmental study when purchasing or even selling the property. Contact a local Real Estate Property Inspector. Have them inspect the premises for structural, mechanical and maintenance deficiencies. Surprisingly, many people want to believe people are honest. Over and over again, we hear buyers complain that the property was misrepresented. The truth be known, many times the Sellers have not known that there were deficiencies, or if they had acknowledged the deficiencies they would have received less. Yet again, we are stressing that a third party appraisal and inspection are always obtained. Cash Flow! Take care of cash shortfall. This mean to maintain sufficient liquidity or cash reserves to cover costs and debt service for a potential shortfall period. There is nothing wrong with selling or leasing a property before you have received a Certificate of Title. This is called an Agreement For Sale. We have talked about this before but we need to show it in another light. This is risky but can be done. Have long term leases signed with Tenants with Conditions in the Agreement For Sale. Before you lease, Confirm in writing that the potential tenant is financially responsible. Specifically address the terms of the lease with the tenant including the tenants responsibility to keep the premises clean and free of any environmental issues. Learn how to find and hire proper and experienced Property Management Companies. Always analyze financial performance using conservative assumptions to ensure that the property can generate enough cash flow to support itself. There is more than just a conventional mortgage/loan that you can obtain from your bank on the Real Estate. You may want to explore other types of loans and mortgages. Examples are: Assumable mortgages, Balloon mortgages, Blanket loans, Bridge loans, Discounted mortgages, Commercial loans, Equity loans, Flexible mortgages, Graduated payment mortgage loans, Offset mortgages, Participation mortgages, Reverse mortgages, Interest-only mortgages, Wraparound mortgages, and other Non-conforming mortgages. Theses are just to name a few! When buying and selling Real Estate, always be aware of the financing rules of the individual Lenders.  For example if you are trying to buy a property to get more money because the appraised value is more than the purchase price, be aware that most Lenders will only give you a percentage of the appraised value or purchase price which ever is the lesser. Understand how your Lender works and how they lend money. Learn how to understand payment and debt ratios. Learn how to manage and build a credit score. When building, buying and/or selling Real Estate, in most cases it make more sense for liability purposes, to purchase through a legal entity rather than own the Real Estate as an individual. Most Banks will finance 60-80% of the Commercial or Industrial project. This means that you will have to come up with 20-40% of the cash for the project. You can raise this cash either from family, friends or third party Investors and allow them a second mortgage as collateral. Most typical small Real Estate loans are amortized over 10 to 25 years. Always keep an eye on interest rates because sometimes it makes sense to break loans and get them refinanced. Take a look at your current interest rate on your loan and compare it to today’s interest rates and see if it makes sense. Net Lease is becoming more common, as it requires the tenant to pay additional rent to accommodate some or all of the property expenses which normally would be paid by the property owner. There are four types of Commercial and Industrial net leases: single, double, triple and bonded. Triple or net lease is the most common as it requires the tenant to pay all common expenses and if there is an increase in utilities, insurance or taxes the tenant not the property owner pays! Typically, well thought out, implemented triple net leases are ‘safe, secure equity investments’, rather than ‘just cash flow investments’. Always have a backup plan. Some times when you purchase a property life unexpected occurs. Have a plan to re-organize; if the first idea does not work or if a sale is necessary because of life’s issues, make sure you know someone that you trust so that you can transfer it in a moments notice. If looking at a new development, have a professional developer analyze the project in advance. Contact them at http://www.pro-land.ca/index.php/contactproland and just ask for a Business Development Officer. Get organized – most competent Lenders can give you a checklist of the documents required to obtain your financing. Get pre-approved – this saves you time by knowing what you can “afford to shop for”. There is no sense wasting your time or your Real Estate Broker’s time looking at three million dollar buildings if you can only afford $ 300,000. Consider low down payments and longer-term loans — this preserves your capital for better utilization, keeps your cash flow high, and allows you to redeploy the “capital savings” into other profit-generating business activities. Last but not least, only work with specific Real Estate Specialist – again, your time is precious so only deal with specialists that are involved in that type of Real Estate.

Well, if you have read this list all the way through, we complement you! Success will occur only if you understand, address and implement the use of the points referred to herein. We hope that www.pro-land.ca is able to inspire you and give you ideas on how to enter the Real Estate market and become successful. Life is a journey and is always worth living, so enjoy the opportunities out there.

If you enjoyed or found this article useful let us know and book mark it!

Questions and comments can be placed at:

1-780-479.7767 or email: team@pro-land.ca

Do you want to invest on something you just don’t know what? Are you looking for something other than stocks from companies? Or maybe you just struck out on the stock market? Then maybe one of these can help you decide on investing your hard earned money someplace other than the usual stock market. There are a number of things you can invest on and usually the bigger the risk, the bigger the return. The return may not come immediately but the wait would be worth it.

One option is property investment or real estate investing. This involves purchasing a property and managing it then renting it to earn profit. There are a number of opportunities in real estate investing, but the first crucial step is to know what you want to manage and rent. The next step is then to find a property you want to purchase. Once due diligence, or examining the property is done (usually accompanied by an expert in examining), the complex process of purchasing the land or property starts (this is usually accompanied by a real estate agent or lawyer this time).

Real estate property are typically more expensive than other investment tools like stocks, but as stated earlier, higher risk comes with higher rewards. Another way to invest, if real estate is too risky for you, is thru consumer products.

Consumer products are an investment for people with enough willpower to take it on. This is because product investment tends to have a long period of poor performance followed by a long period of excellent performance. This could have resulted from the ever changing demand of consumers; of what is fad and what is considered as so yesterday. With that, the best product to invest on is usually what’s hot; this would give you fast return on investment. However, it will not guarantee that the fast return will continue for a long period of time. If you’re creative and lucky enough, you could start something new.

Invest on something different that you think could be the next big thing, and then start out small. When the consumers bite on it, expand little by little until you get great recognition. When that happens, competitors will start to challenge your position for market leader, the next step then would be to sell through franchising, and here is where you can make the big bucks.

If the product you started is hot enough, people would be lining up for a slice of your cake. After squeezing what you can out of the franchise, let it go completely. You can make a lot of money with that without having to face the problems of having too much competitors and other business related headaches.

Another option you can invest on is commodities. Agricultural and mining products can become great investments. The problem however would be the fact that just like consumer products, commodities would have very long periods of poor performance followed by long periods of good performance. An example of this would be oil.

Investing is a gamble everywhere you look at it. It would depend upon your financial goals and willpower whether to take on high risk investments like real estate investing, or stick with a low risk investment.

Stocks are generally categorized according to their market capitalization and price value by the market players. Accordingly, we hear terms like large cap stocks, medium cap stocks and small cap stocks. Shares with very small market cap (up to $100 million) and a maximum price value of up to $ 3 are called penny stocks in the market jargon. These are usually cited as the opposite of blue chip shares, which often carry a premium tag. Penny stocks are usually traded over the counter (OTC) by the brokers because they are unable to list on exchanges due to their stringent norms.

Get Best Penny Stock Pick Program to help you to make profit!

For one thing, big exchanges like the New York Stock Exchange (NYSE) and NASDAQ prefer top-of-the – line companies for listing. More so because they too are keen to feed on reputation of the companies they trade in just as the latter want to cash in on huge turnover volumes of these exchanges. Second, they also strictly enforce compliance of their norms by the listed companies, meaning that those who fail to do so are automatically de-listed. Such exchanges tend to evaluate performance record and caliber of top management of the company applying to list with them.

In contrast, penny stocks are mainly unlisted and traded outside exchanges. In other words, they are nondescript stocks with listless trading. Penny stocks mostly change hands between brokers, without getting much notice from common investors. This is because this category of stocks is supposed to be risky due to lack of key information on the concerned companies, their promoters and management. Perhaps this is the reason why these stocks are so often targeted by investment scammers.

Nevertheless, penny stocks can also turn in unexpectedly big returns if they rise on the fundamentals of the concerned company rather than any market manipulation. This is because most of the penny stocks are generally quite undervalued due to lack of market support. So, anyone who can lay his hands on the right penny stocks might reap unexpected gains some day.

Get Best Penny Stock Pick Program to help you to make profit!

Product Description
A timely approach to downside risk and its role in stock market investments When dealing with the topic of risk analysis, most books on investments treat downside and upside risk equally. Preparing for the Worst takes an entirely novel approach by focusing on downside risk and explaining how to incorporate it into investment decisions. Highlighting this asymmetry of the stock market, the authors describe how existing theories miss the downside and follow with expl… More >>

Preparing for the Worst: Incorporating Downside Risk in Stock Market Investments

When you’re evaluating Small cap stocks with the view to making a purchase for your portfolio, that calculator is going to be a very big help in enabling you to make an informed choice. Take a cue from the serious investors, who analyze the figures and ratios related to the stocks.

Price to Earnings Ratio (P/E)

The P/E is a number that looks at the relationship between the company’s earnings and the price of its stocks. Of all the ratios used for fundamental stocks analysis, this is the most popular. The P/E ratio is calculated by dividing the share price over the company’s EPS, or Earnings Per Share. This will give you an idea of how much the market is willing to pay for each share, and whether a company’s Small cap stocks are high or low relative to its earnings.

A high figure may indicate that there are high hopes for this company’s stocks in the market. On the other hand, it may also be a sign that the company’s stock is overpriced. A low figure could mean that the market doesn’t trust the stock, or that it may be a diamond in the rough and still undiscovered.

Earnings Per Share (EPS)

Earnings per share is computed as the company’s net earnings over its outstanding shares. This figure is helpful in comparing a company’s Small cap stocks with another, in the same industry. Comparing the EPS of a telecomm company with a startup healthcare provider would be like comparing apples to grapes. Don’t take the EPS alone. To be able to make a more informed choice, use this figure to compute for other ratios.

Projected Earnings Growth (PEG)

This figure is computed by dividing the price to earnings ratio over the projected earnings growth. This number helps you estimate the company’s potential for future growth. The higher the number, the more you are willing to pay for each share of future earnings growth. A low P/E with a low projected earnings growth could be a sign that this is an expensive investment, while a high P/E with high projected earning growth indicates that the stock may be a good investment.

Price to Sales Ratio (P/S)

Some companies’ startups ‘may be too young to have any earnings, but may be worthy of consideration. The price to sales ratio allows you to determine a Small cap stock’s potential through the stock price relative to the company’s sales. The price to sales ratio is computed by taking the stock price and dividing it by the sales price per share. The lower the P/S, the better the value of the stock.

Price to Book Ratio (P/B)

Another indication of the potential of Small cap stocks is the price to book ratio. This is computed by taking the price per share and dividing it by the book value per share. The lower the price to book ratio, the better the value of the Small cap stocks would be. This ratio tells you how much the market considers the book value of the company.

Dividend Payout Ratio (DPR)

This is computed by taking the dividends per share and dividing it by the earnings per share. Newer and smaller companies would tend to have a lower dividend or none at all, as they would retain their profit to fund their growth. Bigger and more mature companies tend to pay more and bigger dividends.

Dividend Yield (DY)

The dividend yield is a number that indicates what percentage return a company pays out to its stockholders through dividends. Usually, older and more stable companies will reflect a higher percentage, and their dividend histories are more consistent. The dividend yield is computed by taking the annual dividend per share and dividing it by the stock’s price.

Book Value (BV)

One way of determining a Small cap stock company’s worth is through the book value, which is computed by subtracting the company’s liabilities from its assets. A growing company with a good growth potential would be worth much more than its book value.

Return on Equity (ROE)

The ROE is a measure of determining how well a company uses its assets to produce earnings. This is computed by dividing the net income by book value. Companies selling Small cap stocks that show how consistently they can squeeze out more profits with the assets they have are generally better investments. The ROE becomes even more useful when you look at the company’s figure over a number of years, say the last five years.

When evaluating Small cap stocks through these ratios, we suggest that you compare companies within similar industries. Don’t take one ratio and base your purchase decision on that one ratio alone; use a combination of ratios, and consider other information about the company as well before you buy any Small cap stocks.