Tuesday, September 18, 2007

The Whole Truth About Small Caps

Talk to most traders and ask them about the OTC markets, and you'll likely get either a story about someone who made it big, or someone who lost it all. Like Las Vegas, investors can always tell you a story. The question for you is simple: is this a place to invest your hard earned money.

The answer is yes and no. The key is in recognizing the risk involved. Keep risk to a minimum by identifying which small caps have potential, and which are a trap, and you may find yourself in the staring role of one of those stories about the guy who made it big. If you fail to take heed of the warning signs, you'll find your money, hopes and dreams fade just as quickly as gamblers in Las Vegas.

The very fact that small caps trade at such low volumes increases the risks involved in investing in them. The Securities and Exchange Commission (SEC) strongly suggests traders of small caps to remember that these stocks typically trade with very low volumes on average. This makes finding buyers when you want to sell, and sellers when you want to buy more difficult. As a result, you may not get the stock at the price you want. This can result in buying too high

Despite the risks involved, small caps are often attractive investments to investors for various reasons. If you are new to investing and looking for the chance to return a high yield for a relatively low investment you are likely to come across some microcaps. Its not surprising that investors are attracted to small caps. A move of a few hundreds of a penny can mean big returns for you. For a $0.10 stock to move up 20% requires a move of only $0.02. If the stock moves to $0.20, you have doubled your money. If the stock starts to move, you can double or triple your money within days. You won't find that kind of return on the major stock exchanges.

On the other hand

There is also a strong potential for fraud with some buyers artificially 'enhancing' or driving the costs by buying large amounts of shares and raising the perceived value of essentially worthless stocks. Most investors who fall for this lose many when it comes time to sell.

Most financial advisors will suggest not investing more than 10% of your portfolio on microcaps

It is important to remember that not all of these companies are frauds and many of them have a great deal of potential. Some are new businesses that are working hard towards their goal of earning a spot on the larger exchanges. Do your research in order to decrease your risks of landing with a declining or dishonest company. Often, most traders are often convinced that one good investment can make them a nice tidy profit. While this is true it is better to invest in a company that is showing slow and steady growth than one you are hoping will sky rocket over night. Take the time and do your research rather than gambling with your investment.

Learn more about hot penny stock picks or how to trade at http://www.1source4stocks.com

How To Turn Disadvantages Of A Reverse Mortgage To Your Advantage

When it comes to a reverse mortgage, wise consumers weigh the advantages and disadvantages prior to signing on the dotted line.

Lets start on a positive note, you could do what most borrowers do and opt for the reverse mortgage line of credit. Just think about how you would then be able to draw on the loan whenever money is required for daily living expenses, medical bills, prescription costs, home repairs, etc. This could really enhance your retirement years including in-home care expenses in later years.

Furthermore, your new found income does not affect regular Social Security payments or Medicare benefits. And lenders cannot foreclose on the loan for the life of the borrower.

Okay, thats all well and good but how do you turn the major disadvantages of a reverse mortgage into a positive one? Its all in the perspective. For every negative there is a positive to obtaining this loan.

Its true a reverse mortgage loan may affect your eligibility for state and federal government assistance programs such as Medicaid but it also gives you an important financial cushion and does not (as mentioned above) affect your regular Social Security payments or Medicare benefits.

You also have no monthly payments to make. Granted, the amount you owe continues to grow larger over time but you also have more cash on hand to enhance the quality of your current lifestyle. Look at it this way, you will now have all the money you need (and want). After all, its your money. True, you wont have the full selling price of your home to leave your loved ones but if theyre financially sound in their own right, do they really need a substantial inheritance?

Furthermore with the new found cash, you could re-invest into other income-generating streams such as stock and option trading. But that would be another story with its own pros and cons.

It all comes down to whats important to you, what your current financial needs are and if leaving money to heirs is something you feel you need or want to do.

To take a look at the basics of a reverse mortgage tips and info, get more details from http://www.wealthmountains.com/finance/reverse-mortgage-tips-info.htm

This article is part of the resources, guides and tools dedicated to your financial successes found on Keith Choy's WealthMountains Site. Visit his site at http://www.wealthmountains.com/finance

How Forex Trading Can Change Your Life

Forex trading, or foreign exchange, is a market in which currency is changed from one type to the next in the hopes of making money off the trade. In fact, forex is the worlds largest market because of just how much money can change hands here. Who can do it? How can you get in? And, can you really make a good sized investment off of this type of trading? It almost seems to simple, doesnt it? But, the bottom line is that through forex trading, you can make a good sized fortune. Youll still need experience, education and a little luck but maybe not as much.

Who Can Play The Game?

First forex trading is anything but a game. In fact, people are making hundreds of millions of dollars off of it each and every year. There are big bucks to be made. As for who can get into it, this trading is open to virtually anyone. In the grand scheme of things, though, it is mostly played by central banks, larger banks, currency speculators, governments, international and multinational companies as well as others. Small investors and speculators often can be involved as well. Most of the time these individuals will use brokers to handle their investment strategies.

Because forex trading can actually be done by anyone, it allows for small investments. This is one of the large benefits of forex. Virtually anyone can invest and you dont need a lot of money to do it. Of course, trading with more can lead to more money as well. It can be wise though to go in on a larger trading scheme, through a broker, because these companies can pool together funds for larger, more lucrative investments. Yet, there is a fee involved in it as well.

What Makes Forex Trading Unique Though?

Why not just invest in the stock market or other investment portfolios? Why should you invest in forex over other types of trading? There are several characteristics that make forex unique and these contribute to why many individuals go through this type of investment.

  • Markets are always open. Being able to trade anytime, except weekends, makes this trading market very available to anyone, in any country around the world. You can go to bed at night with nothing and wake up to a huge difference in your investment.
  • The volume. The market is so large that there is quite a bit of volume available through it. This makes it very easy to get in and very easy to actually make a good deal of money as well.
  • Liquid as water. There are no assets, no worries about how well the company is doing. Through forex trading, the funds that you invest are liquid. You can cash them in at virtually anytime. If you are working through an investment firm, it may be harder to liquidate them, but typically funds can be turned into cash quickly, far more so than other investment strategies.
  • There are also a wide number of factors that contribute to the market trading foreign exchange rates. These are the value of the currency that you have in your hand. For example, if you would like to invest in Russian Rubbles, the demand for the Rubble is dependant on the value of that money in relation to other currencies, in relation to the economic and other factors within the county as well as speculative rates as well. What makes rates change can include a simple disbelief in the government, a national announcement of good economic times ahead and hundreds of other factors.

The value of the forex trading market is huge. In fact, it is estimated that the market has over 2 Trillion United States Dollars worth of currency changes happening each and every day the market is open. This large amount of money in the trading environment is what makes it such a lucrative and worthwhile investment for many people.

Getting Started

How can you get into this? How can you make the money that all of those other guys are? Youll find most of the help that you need offered to you on the web. There is a wide range of programs through brokers that can help you. Firms are willing to work with virtually any individual, corporation or small business that has any size monetary value to invest. Contracting with a broker for a small investor is the ideal way to go. Forex trading can be a lucrative market, if you get into it. It can then literally change your life.

For forex trading systems reviewed and rated visit http://www.forextradingsystemsreviewed.com/. You may freely reprint this article on your website or in your newsletter provided this courtesy notice, link and URL remain intact.

Finding Money for Rehabbing Property

If you are just beginning in the real estate investment business, it may be hard to find money to fund your deals. Especially in the beginning, it's going to be hard for you to establish relationships with the right people with no experience. My suggestion is to polish up on your lingo so it seems like you have a little experience. When you approach all of your favorite doctors, lawyers, real estate investors, family and friends with retirement accounts you sound like you are an expert. Go in head strong like you own the place. Trust me you'll become and expert before you know it.

People love to make money and people really love to make money doing nothing and that's what you are going to allow them to do. You take the back ache off of them. When you meet them for the first time be sure you are very professional and decide what rate of interest you are willing to pay. Usually in cases like this you can expect to pay 10-16% to borrow their money. Don't forget it is risky for them and you want the to be able to win too. Create win wins for both of you. Always keep your word with potential investors in your business. If you say you are meeting them at 2:00 pm for a meeting, be there waiting on them at 1:45. Their time is valuable. Don't hold them hostage for 9 hours. Keep your meeting short and to the point.

Do your homework. Do not go into your meeting sounding like an idiot. It is your time to shine. If you really want it, they will know it. Do not cut yourself short by consistently reassuring them. Stay confident and close. Also - do not give up if the first person you approach doesn't work the way you intended it to. Stay focused and determined to go to the next. Keep your message simple and to the point. Make it look like you have a way for them to make a lot of money without lifting a finger. Most of the time, they will jump at the opportunity if it looks good.

Remember - In the real estate business, the most successful people make quick decisions. They do not sit around and ponder ideas. They take action and go with the flow.

Mandy Sheckles is the founder and President of The Wealth Corp. Her company offers Property Rehabbing Education to students around the country. In just eight years, she went from flat broke to being a real estate millionaire.

She is the author of "Renovate Your Success" and the creator of The Rehab Manager, a web-based software application designed to streamline your rehabbing business.


Forex Markets & Its Trading Characteristics

There are a number of reasons why FOREX trading is such a great way of entering the capital markets. Among them we can find its easy accessibility thanks to the use of the internet, the fact that currency trading is all commission-free and also the low transaction costs involved.

There is one important characteristic about Forex that makes it what it is. This important characteristic is that there is not a single unified foreign exchange market in the world. Instead of this, due to the over-the-counter nature of currency markets, there exists a number of interconnected marketplaces, where many different currency instruments are traded. What this implies is that there is not a single dollar rate in the world, but different rates, depending on what bank or market maker you are asking a quotation to. In practice these rates are often very close as you can easily find on the web.

As a piece of general knowledge you must learn that the main forex trading centers are placed in New York, London, and Tokyo, but this doesnt mean they are the only ones; there are other banks throughout the world that also participate. For example, as the Asian trading session ends, the European trading centers open, then the US session, and then the Asian centers open again. This kind of continuos market has the advantage that traders can react to news immediately, instead of waiting for the markets to open.

There are many factors that can influence the exchange rate of a particular currency. These rate fluctuations are usually caused by changes in inflation, GDP growth, interest rates, budget and trade deficits or surpluses, and other macroeconomic conditions f the country emitting the particular currency. Also major news that are released publicly can affect the prices of currencies; so many people have access to the same news at the same time that they can shake a currency price really hard.

According to a specialized study, the most heavily traded products on the spot market are: EUR/USD - 28 %, USD/JPY - 18 %, GBP/USD - 14 % and the US currency was involved in 89% of transactions, followed by the euro (37%), the yen (20%) and sterling (17%).

Forex Trading can make you real money if you learn the correct trading strategies. I particularly recommend you this one:

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