Yet another stockbroker

There are a variety of different methods available to invest in the stock market. However, what most people believe are a safe investment can actually be a LOSING investment over the long run.

So, before you invest another dollar in the stock market, it is best to know the various investment vehicles available.

1. Government Bonds, Certificates of Deposit, and Money Market Accounts

I lump all of these into one group because they are the least risky of all investments. Unfortunately, they are almost the worst performing investment as well. Why? Because these 3 investment vehicles pay a lower rate of return than most other investment vehicles. In February of 2006, a very good money market account or CD account may get 3.5% - 4.5% a year return on the investment, which is barely above the annual inflation rate of approx. 1.7%. But if you are primarily concerned with preserving your investment capital, these 3 traditionally do very well.

2. Corporate bonds

Corporate bonds can offer a better rate of return than government bonds, but of course, they are a bit more risky. For example, GE 14 year bonds are currently offering a 5.65% rate of return. The risk here is that GM could become financially unstable, and not be able to pay back the loan that the bond represents. However, a highly rated corporate bond is generally a safe investment.

3. Mutual Funds

Mutual funds, are in my opinion, the worst possible investment. Now, I know some mutual funds have a 30% - 40% return per year, and some even more. However, the fees involved are usually very high, and MOST mutual funds actually performs WORSE then the market indexes do. The reason for this is in part, because of the management fees involved, as well as the restrictive trading as dictated by each mutual funds prospectus.

Mutual funds are not free to buy and sell any stock at any time that they choose. It must correlate to their investment strategy, even when they strategy is doomed to lose money!
For this reason, I steer clear of mutual funds these days.

4. Stocks

Ah, stocks. Now this is where the fun starts. Stock trading is where you can start getting consistent returns of 20% - 100% or more a year. Sounds great…so what’s the downside? Well, you can loose are your capital easier than in the previous 3 methods, and it takes a more active role on your part to achieve these returns. If you are interested in making more than 20% a year, I advise checking out BreakingWallStreet.com, and find the best stock picking system for you.

5.Options

Options are actually above and beyond what most investors ever consider. In fact, most stock brokers and financial advisors have one thing and one thing only to say about trading options: they are too risky. And yes, they are even more risky than stocks, and should never be invested into non-discretionary money. HOWEVER, options can and do give returns of 100% - 200% in a single DAY. Once again, using a carefully planned out trading system, one can trade options with minimal risk for loss, and a great upside potential. Again, check into the various options systems advertised on the internet.

Keep in mind, that I am not a stock broker nor financial advisor, and before you invest in anything, you should always consult a financial advisor. You can lose all of your money by investing in what you don’t know about. However, it is wise to know all your options, so you can decide how serious you are about investing, and be able to make the money you deserve!

Greg Podsakoff is the editor of http://www.breakingwallstreet.com - a website dedicated to finding the most profitable stock and option trading system on the internet.

Article Source: http://EzineArticles.com/?expert=Greg_Podsakoff
http://EzineArticles.com/?The-5-Most-Common-Investment-Vehicles&id=148553

Technorati Tags: government bonds, investment, funds, trading

You don’t have to be made of money to be an investor. There are many investments ideas for small investors that you probably aren’t aware of. And these investments can be a lot closer and simpler than you think.

One investment idea for small investors is stocks. Now this may come as a surprise since most people think you need to have scads of money to get involved with the stock market.

Many stocks, however, do not cost an arm and leg to buy. They can be quite affordable and you can start with a few shares and work up to larger investments.

Shares in start up companies in a hot industry are one example of a good investment idea for small investors. A few shares of a blue chip stock is another.

Just be sure to do some research first and be willing to hang on to your stock through ups and downs, as stocks tend to be more profitable in the long term and will definitely see some ups and downs.

Government bonds and securities are other investment options for small investors.

Many government bonds can be bought at a low to moderate price, and they will give an investor the advantage of interest payments.

These interest payments can be used for another investment idea. In fact, the interest payments on government bonds and shares can make it possible to diversify investments for small investors.

Investment ideas for small investors can be in more tangible types of items as well. Items such as coins, cars and collectibles are often a good place for small investors to begin.

These types of investments often make an investor feel more secure than when they’re dealing with what is often referred to as “paper “ money. They like being able to keep their investments close to them.

The advantage this can have is that if a coin or collectible has a sudden spike in value it can be easily gotten to and sold for a profit. And, after all, the best investment idea for small investors is the one they feel the most secure and comfortable making.

Read more free investment tips, tutorials & reviews at http://www.Global-Investment-Institute.com

Article Source: http://EzineArticles.com/?expert=Mika_Hamilton
http://EzineArticles.com/?Investment-Ideas-for-Small-Investors&id=79725

Technorati Tags: small investors, government bonds, trading, investments

The mortgage situation is creating insecurity in the stockmarket all around the world. As I predicted and discussed before I think the market underestimate the help it will get from the softness in interest policy all around the world. FED seems to be first out with cutting interest helping the house and mortgage sector to have a soft landing which will holding up growth and ease off the insecurity we see in the stockmarket on a daily basis.

Most of the insecurity we see in the market today comes from the stress if the interest policy will change in a phase that will catch up the weakening growth that might be a fact if today’s mortgage situation will proceed from a credit squeeze towards a credit crunch which in my opinion is not an alternative cause the strong underlying global growth world wide and the big change the FED and other banks gone through the last couple of years with great independence in the focus they got of withholding the growth with inflation and job growth high on the agenda.

The insecurity in the stockmarket will move more money in to government bonds in the short perspective but as soon the market realize that the interests will be coming off and the low valuation of the overall stockmarket is consistent.

Consumption have in the financial history played an important role and what we see coming through the last couple of years is that countries with population that stands for an huge part of the world population is starting to get to a point where the overall consumers for the first time in the history of mankind, reached a level where they have the possibility to consume will change the map of prosperity.

Another aspect is that regions where the growth is strong the interest levels have historically speaking been high but in the last couple of years the interest levels on mortgage loans been coming down on more reasonable levels and the trend are intact. That will also be the case further on as long the policy of interests will be focusing on controlling the inflation and have a strong but healthy growth. An aspect of that is that consumers can start improving there wealth by taking loans, buying houses, apartments and making investments where they can in the long run improve there wealth.

Turkey is an example of a country where the interest of mortgage loans been coming off for some time and the impact of the economy is strong when it comes to the overall growth and the willingness to invest from both Turkish investors and foreign investors all over the world.

The possibilities of taking on loans is driving the economy forward and of course there is times where the willingness on taking on risks will get out of hand but that’s what the interest policy of the specific country should handle to take the market back to a reasonable level when it comes to the willingness of taking on risks for new projects.

Technorati Tags: mortgage loans, government bonds, global growth, stockmarket

If you want to make good money with banks, or any institution, Government and agency bonds are where it is at. Simply because all Government bonds and agencies are AAA rated, and banks can buy millions of dollars of any bond without incurring any credit risk.

All banks own bonds of some sort, and they are buying them from brokers. Our primary bonds are:

• U.S. Treasury obligations (T-bills, T-notes, T-bonds)
• Government Agency Debt (GNMA)
• Private Agency Debt (FNMA, FHLMC, FHLB and others)
• Mortgage Backed Securities (Pass throughs , CMO’s, ARM’s)
• Municipal Bonds
• Investment Grade Corporate Bonds

The institutions that have strict policy guidelines on the bonds that they can buy are Banks, Credit Unions and Municipalities.

The spreads on Treasuries make them difficult to sell or “mark up” more than a few “ticks” to most sophisticated banks and institutions. A tick is 1 point in price. Government bonds are quoted in 32nds.

An example of a treasury bond would be: Bid 101-16 Ask: 101-24. If your client wanted to buy $10,000 of this treasury bond, you would see the price to you at 101-24 (24/32). 24/32 = .75. So the price is really 101.75 or $10,175. Each point represents $10 for every $1000 par bond. For $10,000, each point is worth $100. All bonds trade at a minimum of 1000. Institutions normally buy $250,000 up to tens of millions per trade. So, our example of a $10,000 trade really isn’t realistic and would not be worth your time. A “tick” by the way, is if the price went up to 101-25.

Trading for a few “ticks” on $100,000 would make you very little. If you factor in ticket charges, you might make $100 on the trade. You only present treasuries if it’s non competitive, or if the client is investing at least $1,000,000, otherwise it won’t make you much. If your client deals with 3 other brokers on treasuries, you will all be fighting for very little money. It’s very easy to get a quick quote on treasuries. Every major dealer owns them, and they can be purchased quickly. You or your trader will contact a major brokerage firm (Merrill Lynch, UBS etc.) and buy them. Not much money yes, still, it is assets you are controlling, and it could be used as available money to swap out of into a better investment for the client.

Treasuries are very safe of course, that’s why they are bought. Only buying treasuries will diminish the rate of return of the entire portfolio, if that is their only or main investment vehicle. Treasuries offer flexibility though. The market values on them will normally hold up well over time. They are very liquid and can be traded instantly. You should sell them only as “time bucket” or maturity gap placing.

If you see the bank has nothing maturing in the first half of a year for instance, you can recommend treasuries there too. Remember, institutions are looking for best price, but also good advice. The medium sized banks ($50 million - $500 million assets) will value good planning and thoughtful recommendations over dealing with 10 brokers all day. The larger institutions are more complicated, and require more price awareness. They think they have the ideas covered and you may have to just be an order taker with them.

How To Sell Mortgage Backed Securities or CMO’s

Mortgage backed securities offer the best alternative to decreased loan demand. Pass throughs, CMO’s and adjustable rate MBS’s are paid to the bank just like a loan that the banks has made for a mortgage. If a person takes out a $250,000 mortgage, the customer is paying back the bank monthly with principle and interest. As you know, if you own a home, your initial payments are mostly INTEREST in the early years. A mortgage backed security, if it is a new issue will operate the same way.

Length of the outstanding mortgages, or current face of the mortgages are a factor. “Seasoned pools”, as they are called, are mortgage pools that have had several years of payment on them. They have more predictable payments and duration. They will normally pay better because of that. Seasoned pools are usually what banks are looking for. They are generally interested in better cash flow and predictable cash flow.

The compensation or mark up potential is good in mortgage backed bonds. They are priced above treasuries because, although they are AAA rated, they are not absolute in their pay off and the payments fluctuate. Since they are usually 15-30 years in duration, they allow for price mark up. Where treasuries and straight agency debt allow for a few ticks to a .25, MBS’s can create spreads between buying and selling them up to a ½ or ¾ of point. This can translate to a $5,000 commission on a $1 million sale. Remember, a million dollars in one bond is not unusual for most institutions, and for banks over $500 million in assets, it’s normal.

Other Types Of Institutions To Sell Bonds to:

There are other institutions that buy bonds of course. However, other institutions for the most part can buy other competitive investments, and deal with other brokers in those areas. Also, many of these others hand over portions of their major assets to professional money managers. Banks, CU’s and municipalities only buy fixed income, so their entire portfolio is available to you. They also will very rarely turn their entire portfolio over to a 3rd party. That is not the case with some of these others. They would include:

Insurance Companies
Foundations
Universities
Hospitals
Pension Funds
Cemeteries (Yes, even them)

Ultimately, these accounts can buy almost any type of bond. Corporate bonds can be offered as well. Still, your opportunities are spotty in with these accounts. Information or lists of these types of accounts can be obtained through directories or other sources.

Focus on the Financial and public institutions. They will be a much higher percentage play for you to sell bonds.

Good Luck!

Nick Hunter is the President of American Investment Training and he writes for brokerjobs.com - a finance education and career job site for brokers.

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http://EzineArticles.com/?How-to-Sell-Bonds&id=98139

Technorati Tags: bonds, banks, trading, treasuries

Mortgage brokers play an essential and important role all over the economy. Nowadays, mortgage broker bond becomes the important bond and it is required for the people who are engaged in the business of mortgage broker business, mortgage lending business. Mortgage brokers or lenders or dealers are required to obtain license and permit from the licensing department. This mortgage broker license is required for the mortgage brokers who are engaged in the business of mortgage in state. To obtain this mortgage broker license, the applicant is required to obtain mortgage broker bond from the appropriate state. Mortgage broker bonds are issued as per the statutes and ordinance of the state and federal jurisdiction.

Mortgage broker bond ensures proper performance of mortgage business without any default act of the mortgage broker or lender. Mortgage broker bonds are issued all over the different parts of the states and most of the industries analyzed the need of mortgage broker bond in the state. Mortgage broker bond protects the obligee against the non performance of contract by the principal in the state and enforce the mortgage broker to give a performance. Today, trend has been changed and most of the people enforce to issue mortgage broker bonds as per the state ordinance. Mortgage broker bond also forms part of different kinds of surety bonds and this mortgage broker bond are issued in separate forms and different bond amounts.

Mortgage broker bonds play an effective role in the economy and all most every part of the world mortgage broker bonds are required. Mortgage broker bond are issued as per the rules and regulations of the state statutes and ordinance. All mortgage brokers of the state are required to obtain a mortgage broker bond from the appropriate surety bonding company. Nowadays, more number of surety Bonding Company comes forward to issue mortgage broker surety bond to the people as per their requirement and needs. This mortgage broker bonds are issued to the people as per their requirement and different premiums.

When people recognize the purpose and use of surety bond, then it can be said that nonperformance and default act of the contract will be avoided and prevented. When the mortgage broker or lender or dealer fails to perform the contract, then the obligee can sue the mortgage broker or lender or dealer for non-performance of contract. The obligee has every right to sue both the mortgage broker and surety for the non-performance of contract. When all requirements are satisfied and legally compiled by the applicant, mortgage broker bond will be issued to the applicant. Mortgage broker bond and mortgage broker license are the most important requirements needed for the mortgage broker or lender or dealer.

Ron victor is an Expert Seo copywriter for Surety Bonds. He written articles like Florida Mortgage Broker Bond, Contractor License Bond, ICC Broker Bond and Alabama Surety Bond. For more information visit our site Motor Vehicle Dealer bond .Contact him at ron.seocopywriter@gmail.com.

Technorati Tags: mortgage brokers, stock brokers, bonds, stocks, broker license