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Why should I invest? I am getting a comfortable income every month and I am happy with the way I am spending my money every month, why should I bother to invest? Some people may say that they are having problems meeting both ends at the end of every month, why should they invest when they do not even have extra penny after they pay all their bills.

I think the reason for investment is simple. You WANT to prepare for your future.
Future is not predictable but manageable. You should have long term planning for your future and retirement. Some readers may say that ” OK, but I am quite old now, it will be too late for me to invest now!” I must tell you that it would be never too old to invest! However, the earlier you invest, the better and easier for you to build your nest egg.

Some people may argue that I am keeping my money in the bank, they are paying me good interest, why should I bother to find other vehicles for investment? You may not notice that inflation is eating away your money. Inflation rate is always slightly lower that your fixed interest rate. You may be happy because the bank is paying you 4% interest rate per year, but do not forget that inflation rate in your country may as high as 3.5% or even up to 3.99%. So what you get in return is just 0.5%!

You may notice that years back, your ten pounds or dollars can buy you a lot of household things, but now, you spend almost twice as before to get the same Read more…

The looming hardship that will be faced by many of the baby boomers once they retire could well affect women a lot harder than men. The likelihood of the government being able to afford any sort of reasonable amount of pension is very slim, simply because of the magnitude of the number of people who will be retirees, compared to the working population. The Australian government has realised this, and that is why they introduced the compulsory employer paid superannuation scheme and are even now beginning to give financial incentives to Self-funded retirees. They are also now encouraging people to work well beyond the 65 year barrier.

Most people have never sat down and even considered the ramifications of why the compulsory super was introduced and for many of us it is a matter of too little too late. Even for the young women in our society ? who have a full working life ahead of them, they still cannot rest assured of a comfortable retirement.

Why is this? It is because that unfortunately even with contributions at the current level of less than 10%, someone on an average wage who works continually for 30 years, is still going to find themselves trying to survive on an income equivalent to less than $20,000,00 per annum in today?s dollars.

You will notice that I said continually working for 30 years. This is another reason why women are particularly disadvantaged, firstly because they often have to take up to ten years leave from the workforce to raise children, secondly because women in general earn less than their male counterparts and thirdly because an enormous proportion of the women in Australia, will never have received any previous superannuation contributions, prior to the compulsory superannuation being introduced, and will therefore not have had contributions made over their entire working life so far, giving them even less to fall back on by the time they retire.

Many women may previously not have thought of lack of superannuation contributions as being a problem, as their husbands may have been contributing to super since they first began work. Unfortunately though with the high number of divorces in this country, it is unwise to rely on the fact that your partner?s superannuation will be there for you in your retirement years and even if a large proportion is awarded in a settlement ? that it will be sufficient to sustain a comfortable retirement for any length of time.

All of these factors are why women now more than ever, need to begin taking action to build up a source of ongoing income, that will grow to such an extent, as to be able to provide a secure and happy future for themselves and their children.

It needs to be a source of income that is unrelated to physical work?that is an income that is generated from income producing assets ? Read more…

If you want to be a Doctor, learn medicine.
If you want to be a footballer, kick a football around.
If you want to be a bus driver, learn how to drive a bus!

If you want to be rich, what do you do?

A lot of people when asked the above, will work harder at their job, or take a second job, or start a business.

All the above a good, but are not right. They are definitely putting the cart before the horse.

If you want to be rich, what do you do?

The FIRST step to becoming rich is to DECIDE TO GET A FINANCIAL EDUCATION.

This leads to two supplementary questions.

(1) What is a financial education?
(2) Isn?t that hard?

Answer One: I do not mean that you go out and get yourself a MBA, or any official financial qualification. What I mean is that you DECIDE HERE AND NOW that you will start to accumulate financial knowledge from any source and by any means, and that you will do this for the rest of your life.

Financial lessons are all around, all you have to do is decide to keep an eye out for them and learn them. If you have watched TV today, or read the paper, or even just, taken a walk, you will have seen many financial lessons.

Examples from my day so far.

TV: Holiday scams using bogus websites ? research and write small article on this, email to friends and print out and hand to acquaintances, include a link back to my website. They get a helpful warning; I get increased visitors to my website.

Newspaper: Property prices are up in my area. How can I cash in on this? Find a rental property, and buy (clubbing together with acquaintances if necessary).

Walk: Local clothing store is having 50% sale. I go in and ask what profit margin clothing stores usually have. After a little effort they tell me. An interesting lesson.

Answer Two: No it is not hard at all. Why? Because you will take it one small step at a time over the rest of your life. One small step at a time, taken frequently leads up to an enormous distance. In the area of financial education this means an enormous education.

The more you have taught yourself about how money works the more money making opportunities you will see. Eventually, once you have taught yourself enough, you will see that your life is absolutely packed full of money making opportunities. And your financial education will also equip you to cash in on these opportunities. All you have to do is reach out and take that money!

When you know enough, making money becomes easy and second Read more…

If you are interested in learning how people are building a wealthy live style over time then let me explain to you exactly how they are doing it. Making money is one thing. But there are those of us out there that are living the dream making millions.

Most people think the only way to get rich and make millions is marry into it or hit the lottery. Sure those will work but not everyone is just that lucky. So we must find another way to make our money.

Investing is where the money is at waiting for us to come take our share. When you invest money you wont see the pay off over night or even in a month or so. Investing takes time years. If you invest your money at the right time and in the correct spots you can easily make a huge amount of profits in just a few short years time.

However with any investment there are risks involved. You never know just how your investment is going to go. One month it might make money one month it might lose. It?s a numbers game, and those that know how to play it will win big.

I myself research on the Internet looking for my next big investment each and every Read more…

Have you always wanted to enjoy the sort of profit opportunities that are only possible from stock market investment – where the average long term gain has exceeded 10% a year for decades – but been put off by either the complexity or the cost? Or maybe you are already a shareholder and keen to reduce your risks and increase your returns? Either way, you should consider becoming involved with an investment club.

The investment club concept is simplicity itself. A group of friends, colleagues or neighbours pool their money in order to invest in stocks and shares. To get the club started members put in a lump sum – perhaps a few hundred pounds – after which they each make a fixed monthly contribution. Some clubs call for as little as ?100 a month investment, others set the limit somewhat higher. Once the club has sufficient funds it will start to make investments. At any point individual members may withdraw their cash and a collective decision can always be made to wind the club up.

As a way of making money, investment clubs offer some fantastic benefits.

To begin with, they overcome one of the biggest problems facing private investors: how to diversify. The best way to avoid losses and optimise profits when investing is to put your money into a portfolio (or range) of different company shares. There is no magic number of companies you should invest in, but I would have said the absolute minimum was 15. Due to the cost of buying and selling shares it is rarely worth investing less than ?2,000 in any one company so for a private investor to even begin to diversify he or she must have at least ?30,000 – and ideally considerably more. This is a lot of money for many individuals to find but not for an investment club. For instance, a club with 20 members contributing ?300 each on day one and ?25 a week thereafter would manage it in under a year.

The next advantage that investor clubs offer is that the members are pooling more than their money. Deciding which company shares to buy in order to maximise your returns is a time-consuming business. First you have to select the sectors you are interested in. Then you have to pick out companies you believe will do best. Given that there are hundreds of companies listed on the London Stock Exchange not to mention all the other stock markets around the world it is definitely a case of ‘many hands make light work’. Furthermore, different members of the club may have specialist industry knowledge that can further boost the chances Read more…

Owning your own property is one of the top ten global dreams. You may never have perceived that the pros of owning a home and land are innumerable. But there is much more to ownership than just a piece of paper. Of course, here’s a sense of pride, but property ownership is also instrumental in making a country and culture stronger. A society that encourages property ownership ensures stability and long term economic growth. The economic growth is not limited to the overall population. On owning a home, you have bought far more than a mere place to stay. You have invested in your future.

When you pay rent, you send your money off to someone else for the privilege of staying for another month where you are living currently. When you pay a mortgage, you also send money off to someone else, this time a bank. There’s not much difference there. The real difference comes when you move, or when the house is paid off, whichever comes first. That’s when you discover the true magic of home and property ownership. Of course, there are benefits before then. You can decorate and remodel as you like, without worrying about having to pay for it in the end with your security deposit.

Consider when you move out of the rented home. You pack up your bags and boxes, put them in the truck, and move into your new place. If you’re lucky, you get some of your security deposit back after a month. Now consider when you move out of the home you own and into another home. Again, you pack and unpack, but you have something extra. You have money in the bank, and that’s when the real benefit of home ownership hits you.

You have certainly put up Read more…

You know it?s absolutely crazy. Every time you think you understand the stock market, something comes up that makes you wonder whether there is any sanity in it at all.

I mean, just take a look at the way the DOW has been behaving of late. One would be forgiven for assuming that the market has been taken hostage by a bunch of aliens, aiming to wreak havoc on our investments!

It would seem that no sooner does the DOW Jones recover from a bad day?s trading it swings back into a disastrous trading the following day. And these wild swings appear to have spread to other major indices as well.

Exactly what is one to do under such circumstances and how do you protect your investments from being completely wiped out?

Well there appear to be two schools of thought as far as this is concerned and depending on your risk appetite you can determine which way to go.

The first school of thought is, move with the market, whichever way it goes. In other words, buy when the market is generally moving up and sell when the market is generally moving down

In this case short selling of stocks would be the route advocated by this school of thought. This is good advice if you actually know how to do so and have the expertise to come out ahead.

It is however a disastrous route to go, if you have no experience in this process, as it could quite easily result in complete loss of investment.

The second school of thought suggests that if the market is this choppy and undecided, then this is the time Read more…

NASDAQ: SFUN 26.88

Do you think the market for smart phones, digital audio (MP3) players, consumer solid state drives (SSDs), portable media players, digital video cameras, GPS devices, multimedia and music handsets, memory cards and USB flash drives are growing? All these products provided a disruptive position taking away market share from their predecessors.

One market segment that could see even stronger growth than these separate products we mentioned, and include other growth products, is the flash memory market. Flash is a root component used in all the above products and more.

Based on history we are forecasting that flash is the memory medium of choice for a plethora of devices in the consumer electronics in wireless devices and that flash will grow faster than the wireless devise market. It appears that in the past, memory for computing devices has grown faster than the device that utilizes the memory. Memory of the Personal Computer (PC) and the Internet has grown faster than their supporting platform. With the PC creating tremendous growth and history as our guide the demand for both memory and disc drives for the personal computer was often the impetus of many upgrade cycles. The Internet with the many millions of new web pages created a tremendous growth in storage. I?ve seen in many reports that forecasted storage of the internet has been one of the fastest growing subsets of the internet as a whole.

With a decrease in price per gigabyte (GB) of more than 80 percent over the past three years and with the high growth in wireless data the need for new and addition memory could exceed the growth of the hardware device market that uses flash for its memory. The current market in flash memory is about $25 billion annually and its forecast is about 40 billion by 2010.

With each new product cycle the advantages of flash have become more disruptive allowing it to become about 30-40% cheaper every year. Many experts are forecasting this disruptive curve to replace the disc drive market for PC?s. Flash has already replaced hard drives in most MP3 players.

Currently the flash memory is designed to support two types of flash memory. One type of memory supports your machines internal usage or operating system, the other type is for more external storage needs. The internal memory often uses the architecture of NOR, which has been established for years and Intel (NASDAQ:INTC) considered by many as the market leader. The NOR technology is a more complex technology and is starting to see the market mature.

Often you will find both NOR and NAND in the same mobile device.

The much faster growing market is for external memory market needs or NAND and the one of the leaders is SanDisk. SanDisk Corp. (NASDAQ: SNDK), founded and managed by president and CEO Dr. Eli Harari. SanDisk and Toshiba jointly launched the multi-level cell (MLC). This technology made it possible to divide the cell and store two bits of data on the same piece of silicon (x2, as it were), which significantly improved the profitability of manufacturers and fabs, basically doubling the price performance curve.

This process has become the leader and allowed NAND MLC to become disruptive to the predecessor NOR architecture and in 18 months penetration has been so great that MLC is becoming dominate force in flash.

We believe that this new curve of double captivity on a single cell technology will become the single most important factor for next generation flash memory, and it will become essential as flash is staring to see possible limits in the reduction of its die size as many experts are starting their forecasting. If flash is going to continue on its curve of lowering the price of a gigabyte by 80% over the next three years, it is my opinion they will need an architecture that?s designed specifically to establish this goal. There is a proprietary NROM architecture that has many advantages toward increasing capacity of bits per cell. The NROM is close to production of 4 bits of memory in each cell or quad flash.

The company we believe has a unique position and leads the NROM approach in the flash memory market is an Israeli based company called Saifun (NASDAQ:SFUN).

Saifun is an intellectual properties company which its revenues come in three forms: licenses, royalties and support. This type of model has been very successes for our model portfolios in the past. The three previous companies that had core business from intellectual property we investment into our portfolio?s were Qualcomm (NASDAQ:QCOM) in1997 at 3.31 per share and still holds a position. Arm Holdings (NASDAQ:ARMHY) in 9/29/1999 @ 9.60 and holds half a position and Rambus (NASDAQ:RMBS) in 1998 which appreciated about 350% in 2000 and we sold the position in the model portfolio when Intel stopped supporting the Rambus architecture late and 2000 and in 2001.

Even though it is very early is Saifun publicly traded history we are excited by its new form of flash memory architecture, it appears that Saifun?s approach has many advantages over the more established NAND and especially NOR. The single most important part is their technology curve. They have the ability to double the bits per cell allowing for a second compounding curve. The other architecture they are working hard on is to shrink their size and increase density, but we believe that Saifun with its simpler model should achieve a smaller die than the others but the real advantages with Saifun is the ability to allow 4 bits of memory in every piece of silicon (x4). Doubling again the events of MLC while at the same time reducing their size thus possibly leading the new flash architecture. Another advantage is NROM?s ability to work both as an operating system and memory component being able to supply both markets that individually NOR and/or NAND has target.

A second company has just announced that in 2007 they will start producing a 4 bit cell in NAND. The company making this announcement is M-Systems (NASDAQ: FLSH). They claim they will have a product on the market some time in 2007. Even though they have achieved this tremendous breakthrough we believe that because they use the whole cell instead of a fraction of the cell for this doubling process, the whole cell?s ability to double again may become geometrically tougher. On the last review M-Systems has not explained their business model to (make at own fabs or licenses) and delayed the secondary offering.

It is has been our opinion that companies that form successful royalty Read more…

Most people never forget their first love. I’ll never forget my first trading profit! But the $600 (1970 dollars) I pocketed on Royal Dutch Petroleum was not nearly as significant as the conceptual realization it signaled! I was amazed that someone would pay me that much more for my stock than the newspaper said it was worth just a few weeks earlier! What had changed? What had happened to make the stock go up, and why had it been down in the first place? Without ever needing to know the answers, I’ve been trading RD for thirty-six years!

Looking at scores of similarly profitable, high quality companies in this manner, you would find that: (1) most move up and down regularly (if not predictably) with an upward long-term bias, and (2) that there is little if any similarity in the timing of the movements between the stocks themselves. This is the “Volatility” that most people fear and that Wall Street loves them to fear. It can be narrowly confined to certain sectors, or much broader, encompassing practically everything. The broader it becomes, the more likely it is to be categorized as either a rally or a correction. Most years will feature one or two of each. This is the natural condition of things in the stock market, Mother Nature, Inc. if you will. Don’t take her for granted when she gets high, and never ignore her when she feels low. Embrace her volatile moods, work with them in whatever direction they travel, and she will become your love as well!

Ironically, it is this natural volatility (caused by hundreds of variables human, economic, political, natural, etc.) that is the only real “certainty” existent in the financial markets. And, as absurd as this may sound until you experience the reality of it all, it is this one and only certainty that makes Mutual Funds in general (and Index Funds in particular) totally unsuitable as investment vehicles for anyone within seven to ten years of retirement! How many Mutual Fund investors have retired recently with more liquid financial assets than they had seven years ago, way back in 1999?

There will always be rallies and corrections. In fact, it is worthwhile to “go back to the future” to establish a realistic Investment Strategy. In the last forty years, there have been no less than ten 20% or greater corrections followed by rallies that brought the market to significantly higher levels. The DJIA peaked at 2700 before its record 40% crash in 1987. But at 1700, it was still 70% above the 1000 barrier that it danced around with for decades before… always a higher high, rarely a lower low. The ‘87 debacle was followed by several slightly less exciting corrections, but the case was being made for a more flexible, and realistic, Investment Strategy. Mutual Funds were spawned by a Buy and Hold Mentality; Mother Nature, Inc is a much more complicated enterprise.

Call it foresight, or hindsight if you want to be argumentative, but a long-term view of the Investment Process eliminates the guesswork and points pretty clearly toward a trading mentality that keys on the natural volatility of hundreds of Investment Grade Equities. During corrections, consider these simple truths: 1) although there are more sellers than buyers, the buyers intend to make money on their purchases, 2) so long as everything is down, don’t worry so much about the price of individual holdings, 3) fast and steep corrections are better than the slow attrition variety, 4) always accept even half your normal profit target while buying opportunities are plentiful, 5) Read more…

Although investing in mutual funds isn’t the type of subject associated with wild parties and celebrations – it is something the serious investor should consider as a way of increasing their total worth.

“But what EXACTLY is a mutual fund” I hear you ask – “how does it work, who does what and how much do they cost?”

Hang on, slow down – one question at a time please.

What exactly is a mutual fund?

Mutual funds are sold in shares to the public, allowing them to own different percentages of the fund depending on the amount they invest.

Pay more = own more. Own more = get more $$ back again (theoretically)

Simple.

Stocks, bonds, money market securities and the like are purchased through the assets of these mutual funds in the financial markets. Shareholders indirectly own the assets held in the mutual fund, but the fund is guided by the investment company that finds the best way to earn the biggest return. (Indirectly owning the assets through these funds allows them to avoid the big tax hit.)

How does a Mutual Fund work?

Usually, mutual funds are also known as open-ended investment companies. This means that they constantly issue new shares and redeem existing shares, but not all mutual funds are open however. Some mutual funds are ?locked? where they no longer will take on new investors.

The fund?s Net Asset Value is the key concept to understanding how a mutual fund operates. By this value you can determine the value of a share of the fund at any time. The market value of the fund?s assets less any liabilities, divided by the number of shares outstanding is the formula to understand Net Asset Value.

If you work through that it will show you exactly how much each share in the fund is worth when you are looking to invest in them. By comparing this number over time you can see the returns earned in a percentage. This is generally all done for you on a funds website or on any of the mutual fund sites that feature stats.

Who does what?

Mutual funds basically take your money, combine it with the money of other investors like you and then invest the total pool of money in investments with the best possible return. The returns from the fund are then split to the accounts that bought in by the amount of shares that each person owns. The fund managers then take their cut based on the fees that they charge you and you get your return. These guys are worth it for the money they make you, so why not let them drive the car for a Read more…