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.

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Technorati Tags: government bonds, investment, funds, trading

Investment opportunities galore in today’s globalized world, but if you do not want to take too many risks and earn handsome returns as well, then mutual fund investments are certainly your best bet. No doubt, a large portion of your invested money will be ultimately channeled to the so-called volatile stock markets, but you need not worry because your funds and that of other investors will be put under the management of seasoned professionals who will take care of the risks involved and ensure that you get the best possible returns from your investments. Moreover, since the mutual fund company will not charge you anything more than a small amount as processing fees, it makes more sense to opt for mutual funds rather than to make direct investments in the stock market.

Mutual funds have always been one of the most secure investment options available because they are based on the time tested logic - “never place all your eggs in the same basket.” Money collected from retail investors such as you is channeled to various investment avenues such as equities, bonds, short-term money-market instruments and others, something that automatically reduces the associated investment risks. Investments risks are also reduced because most mutual fund companies often have intra company shareholdings that act as insurance against potential future downfalls or volatility in the money market.

It is not that your returns are guaranteed, but since the chances of earning profits is relatively more in case of mutual fund investments, it is always better to park your hard earned money in such secure instruments. You will benefit not only from the dividends that you will be entitled to receive, but also from the appreciation in the NAV (Net Asset Value) of your mutual fund units. Liquidity is also not a problem because you can sell your mutual fund units as and when you want at market rates (NAV). Your decision to sell will however be dictated by factors such as your present financial needs and your present and future financial goals and objectives.

Mutual funds are certainly one of the most secure investment avenues, but still you need to be prudent simply because not all mutual funds available in the market offer the same benefits. To ensure the safety and profitability of your investments, you will thus have to select only those funds that hold the most potential for future growth. It is only then will you be able to do justice to the phraseology: “Mutual Funds - A secure investment!”

GREG S. owns and manages his Mutual Funds website where you can get more useful information about investing in various types of Mutual Funds.

Technorati Tags: mutual funds, investment, stock market, secure investments