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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…

Openwave Systems Inc. provides Communication Service Providers (CSPs), including wireless and wireline carriers, Internet Service Providers (ISPs), portals, and broadband providers worldwide, with the software and services they need to build boundary-free, multi-network communications services for their subscribers.

Openwave has a very unique and valuable business in the wireless data market. It has a dominate market share of 50% in both the browser and in the gateway transitions for mobile phones. Both products are a core element in the data cell phone market.

Our philosophy is to own the critical elements in markets that appear to have revolutionary growth. In January 2004 we wrote an article saying the wireless revolution has begun. Today based on very recent guidance from Texas Instrument (NYSE:TXN) Qualcomm (NASDAQ:QCOM) and other third party data it appears that wireless data market is actually accelerating. That appears opposite common wisdom judged by the way the world equity market and Openwave stock is trading for the last month. Usually revolutionary growth acceleration is misunderstood. I believe that robust growth from wireless data will catch many people by surprise when it is fully recognized.

The browser and the gateway business are key?s to Openwave’s success. Again it is our philosophy to own critical monopolistic elements inside an industry. We often equate our philosophy to a roof over your head and the gutter that controls the flow of water. Most water when it rain will land on a shingle but will collect in high volume in the gutters. Thus a single gutter can control as much water as all the shingles combined. This model of finding the essential elements or monopolist companies, judged by the many top rankings awarded to us by third party profession indicates a very successful approach.

In wireless data market the gateway and the browsers form what we believe are that critical element in the industry with Openwave a dominate position in both those markets. This dominance of the critical element/monopoly creates a natural mote or barrier as Openwave is in a better position to bundle, integrate, and test its products, thus become a natural extension of their browser and/or gateway for every new service they enters. This bundled approach as Microsoft has proven over time not only has a higher comfort advantage for it?s users but also often could be produced at a far lower cost which the phone companies enjoy. These many economies of scale of a dominate player is attractive to the phone companies when they are both reviewing new or existing services. Put yourself in the place of a large carrier do you want to work with a new firm, with no proven history which would include additional integration, testing, billing plus on going maintenance or would you prefer an existing firm to increase their service or possibly just bundle the service into a existing product. That?s why it?s very hard for new wireless firms to make a presence in the wireless data market and the more established companies to consolidate when newer wire data services form.

It appears industry wide that the consolidators including Comverse Technology Inc. (NADSAQ: CMVT) and Amdocs Ltd. (NYSE:DOX) appear to have advantage over many newer companies. Both of those companies specializes more on the back end. The higher growth market for phones will be with the data services and in my opinion Openwave is the best positioned as the industry continues to consolidate.

About 60% of Openwave quarter is already booked not including about an addition 10% is pay as you go. That means Openwave needs about 30% of addition new revenues in the quarter. That indicates that Openwave has far smaller hurdle rate than most companies. The data supports that the number of new data phones growing combined with the rising usage of each phone with no new major competitive threats entering the market the probability of carriers to reorder is increasing.

Openwave’s high valued license revenues.

Last quarter Openwave reported that licensing revenues was over 50% of total revenues and it had 97% gross margins. The licensing revenues make up over Read more…

Talk about living in turbulent times! Have you noticed how the US stock market has been taking a beating of late?

If you wanted an example of a real yo-yo market, you only need have followed the Dow Jones over the last few weeks and this would have been a perfect example. Not that the Nasdaq was performing any better either!

With all this movement, it?s almost as if the market is desperately trying to establish a trend, but not quite settling into one.

Whenever this happens, our advice to any would be investor is to resist any temptations to jump in to make a quick kill, as the technical signals appear to be somewhat inconsistent and are not reliably leaning in one direction or another.

This is a typical sign that the market is in a yo-yo trading mode, with gains that are made in one week being given back the following. This is an expensive way to learn about market volatility.

It appears that a lot of the smart money is not convinced that the bottom is in place and therefore does not see an opportunity to buy good stocks cheap just yet.

Meanwhile there is lots of noise coming from market gurus and other would be ?experts? on what stocks to buy and why, with many of them having conflicting views on what the market is 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…

Stock trading is the commonly used term to refer to the practice of selling or buying equities or stocks or shares in corporate companies in stock exchanges or bourse operating venues.

Through the practice, investors can place money or investment in several or particular company.

A gain or a loss in stock trading is accumulated on the difference between the sales price and the purchase price.

Stock trading is usually conducted during daytime. That is because it is assumed that during daytime, most and major businesses around the globe normally conduct businesses.

There are various stock trading venues. In one country, there must be at least one stock trading venue where equity trading is transacted for the entire country.

But there are countries that host more than one number of stock trading venues. The United States for example has more than one stock trading venue other than the very popular New York Stock Exchange.

In the United States, they also have the Nasdaq Stock Exchange where minor stocks or small-capilatlization companies are traded.

In Australia, there is the Australian Stock Exchange and other exchanges. It is because like the United States, Australia is a very large country that consists of several huge states.

Making investments

Investors have just to make connections to brokers in order to infuse capital or buy shares in stock trading activities. Brokers are accredited individuals or firms that are specifically tasked or commissioned to do such transactions.

Before brokers are allowed to be in between you and the companies where you may want to buy stocks from, they undergo intensive and comprehensive training.

Stock trading requires a lot of knowledge and meticulousness. Because there a lot of papers and documents that you have to process, the broker should be able to handle each with utmost care and certainty.

Before you are able to buy equities or stocks through stock trading activities, you should be able to provide a minimum capitalization.

The documents expected or required from you should also be turned over to your official stock broker so that no legal or civil issues will arise Read more…

Know the Rules

Employee stock options can provide you with a substantial source of deferred income and permit you to control the recognition of taxable income. You generally pay no tax when an option is granted because you are not receiving any shares of stock, only the option to purchase shares at a later date.

In general, holding an option to acquire stock may be better than holding the stock itself. The option provides protection against loss should the value of the stock decline below the exercise price. In addition, the option gives the holder equivalent ownership rights in the corporation, without requiring any immediate investment. Employee stock options offer the potential to have post-exercise stock growth taxed as capital gains rather than ordinary income. This provides an advantage for those who are in the top tax brackets

Know the Difference

Nonqualified Stock Options (NSOs) give an employee the option to buy corporate stock at a specified, fixed price (usually at fair market value at the time the option is granted). In general, you must exercise your option to buy within a specified time period–typically 10 years or less.

Upon exercising your rights, any gain realized from the spread (the difference between the exercise price and the fair market value) is taxed as ordinary income. However, any gain realized from the date the option exercised until the date the stock is sold is taxed as capital gain.

Incentive Stock Options (ISOs) also offer the option to purchase corporate stock at a set price, but ISOs cannot be issued with an exercise price below the current fair market value of the stock.

Generally, the spread on ISOs is not subject to ordinary income tax at the time you exercise the option. However, spreads may be subject to the alternative minimum tax (consult your GROCO financial adviser for more information). Gain realized upon the sale of the ISO stock may be taxed as capital gain. Provided you have held the ISO stock for at least one year from the date of exercise and at least two years from the date the option was granted, the entire gain recognized upon sale of the stock is taxed as a long-term capital gain.

When to Exercise Your Options

The decision of when to exercise your options depends on several factors as well as your particular situation:

Your Company’s Plan

Generally, options become exercisable over a period of years. For example, options granted in the company plan vest 20 percent a year over five years. It’s important to know the details of your firm’s plan before you make a decision.

Your Company’s Growth

Understanding how your company is poised for growth is another important factor in your decision making process. Issues to review and understand are:

How your company makes money ? understand the industry that their earnings are tied to.

Evaluate sales ? compare your company?s sales to the industry average of competitors.

Industry trends ? monitor the industry that your company operates in. Look for growth opportunities and understand your company?s strategy for capturing market share.

Understand the factors that can affect the liquidity of the market ? are lower interest rates and tax cuts freeing up resources for the company?s growth plans?

How your company is financing growth ? are they growing as expected?

Know your leaders and their track record ? a company?s strong executive team will likely yield continued success.

Understand your company?s P/E (price to earnings) ratio ? look for strong cash flow and well-managed Read more…

How much financial bloodshed is necessary before we realize that there is no safe and easy shortcut to investment success? When do we learn that most of our mistakes involve greed, fear, or unrealistic expectations about what we own? Eventually, successful investors begin to allocate assets in a goal directed manner by adopting a realistic Investment Strategy… an ongoing security selection and monitoring process that is guided by realistic expectations, selection rules, and management guidelines. If you are thinking of trying a strategy for a year to see if it works, you’re due for another smack up alongside the head! Viable Investment Strategies transcend cycles, not years, and viable Equity Investment Strategies consider three disciplined activities, the first of which is Selection. Most familiar strategies ignore one of the others.

How should an investor determine what stocks to buy, and when to buy them? Will Rogers summed it up: “Only buy stocks that go up. If they aren’t going to go up, don’t buy them.” Many have misread this tongue-in-cheek observation and joined the “Buy (anything) High” club. I’ve found that the “Buy Value Stocks Low (er)” approach works better. A Google search produces a variety of criteria that help to identify Value Stocks, the standards being low Price to Book Value, low P/E ratios, and other “fundamentals”. But you would be surprised how the definitions can vary, and how few include the word “Quality”. In the late 90’s, it was rumored that a well-known Value Fund Manager was asked why he wasn’t buying dot-coms, IPOs, etc. When he said that they didn’t qualify as Value Stocks, he was told to change his definition… or else.

How do we create a confidence building Stock Selection Universe? Simply operating on blind faith with one of the common definitions may be too simplistic, particularly since many of the numbers originate from the subject companies. Also, some of the figures may be difficult to obtain quickly, and it is essential not to get bogged down in endless research. Here are five filters you can use to come up with a selection universe of higher quality companies, and you can obtain all of the data inexpensively from the same source:

1. An S

Anyone contemplating entering the field of stock market investment should certainly be aware of the fact that there is the very real possibility of losing money in your dealings. Obviously, most enter this challenging arena with the intent to make profits and this, too, is quite possible. However, as with most things in life, ignorance can be dangerous so it is advisable to ensure that you have covered the groundwork necessary for success. The following tips are generally accepted practice and should form the basis for all your investing strategies.

Basic Economics

This really just boils down to common sense in that the stock market merely caters to the criteria of supply and demand. There are those wishing to sell stock and there are others who wish to buy. This buying and selling of stock forms the basis of all day to day trading and investors buy stock at a certain price and then hold it until the price (hopefully) rises when it is then sold for a profit. Prices of stock are in a continual state of movement which is directly related to the supply and demand prevalent at any one moment. Usually if there is high demand for a particular stock then the price will usually rise. Conversely, should there be more stocks for selling than there are buyers for that stock then the price may very well go down. Shrewd judgement is required to turn a profit and that comes with experience and time.

Company/ies Research

This is probably one of the most important fundamentals of all. After all, if you are going to invest in the stock of a company you will wish to do so with confidence. Check the company profile, how it has performed in the marketplace, what its products or services are like, and generally try to establish how well it has fared in business. Does it appear to be a stable, well-structured company that delivers on both its promises and profit targets.

Company Longevity

Trying to access the likelihood of a company being around in, say, ten years or so is rather a difficult thing to do. However, some long-term stable companies are usually those owned by governments, telecommunications and gasoline. Profits of these companies are good due to these products and services always being in high demand. Another fast growing sector of the market is in the field of IT with more springing up almost on a daily basis. Great care should be taken here and only those companies with a proven track record should be considered for investment. It can be all too easy to become excited if a company has seemed to perform exceptionally well but short term success does not mean stability for the future so caution and restraint should be the exercised in these instances.

Keep up to Date with the Latest News

The research of companies that are being considered for investment is an ongoing thing due to the fact that Read more…

Some individuals and companies have all the necessary ingredients for a successful business. But in most cases, they will lack one important ingredient: cash. Funding or Financing provides these entities the chance to come up with funds to forward their business enterprises.

Funding or Finance addresses the ways in which individual, organizations, or business? raise and use financial resources for their needs.

Finance is the branch of economics that is concerned with providing funds to individuals, businesses, and governments. It also allows these entities to use credit instead of cash to purchase goods and invest in projects.

For example, an individual can take out a loan from a bank to buy a home or a car. An industrial firm can raise money through investors to build a new factory or to expand their operations. Governments can issue bonds to raise money for state projects and budgets.

In the economy, finance plays a vital role in the industrialization and expansion of trade and wealth. Banks, credit unions, and other financial institutions provide credit help put money to work by directing funds from savers to borrowers.

Since the savers do not yet need their money, and have no intention of investing in any profitable ventures, banks use lend these funds to entities that have an investment need. As the entity that borrows pays back what it has been loaned, it also pays interest, part of which goes to the savers that own the funds in the first place.

This cycle of borrowing, earning, and repaying spurs economic growth and industrialization. Today?s fastest growing economies all have these financial instruments in place to finance that growth.

The stock market is another means of funding. When a corporation desires to expand its operations or to build new projects, it may raise funds through securities. Securities are instruments of finance that include stocks and bonds.

Stocks are certificates of partial ownership of company, so stockholders partly own the company they hold stock in. A corporation may offer stocks to the public for sale to generate funds.

In return, these investors will gain partial ownership of the corporation, or equity and Read more…