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Archive for July 22nd, 2015

Some TIPS for Mutual Fund Investing

Wednesday, July 22nd, 2015

These are the most important questions when one goes out to try and find the best growth or bond fund. Some of the best sites for mutual fund research are: Morningstar (easily the most famous), others are magazine type web sites such as money magazine, motley fool, etc. As far as what actually makes a great fund?

Expense ratio (which is the ratio of what they charge to run the fund as opposed to the total amount invested), a long history of success, and most importantly (in my opinion) how well the fund has done in bad times! For instance, in the incredibly disastrous year of 2008, if a fund did not lose more than 10% or stayed equal (regardless of whether that fund was a growth fund or a bond fund), then this fund should be considered an “all weather” fund, because the year 2008 is the acid test for mutual funds for all time, or what they are now calling it, a “Generational Low” in the stock market.

Some analysts and financial experts have been saying that mutual fund investing is for the birds, a suckers bet. I totally disagree. I believe that all investors should have a portion of their portfolio in grown and bond mutual funds, and a separate part of their portfolio in a very low priced discount broker with the best commissions. This way if you’re wrong on one end of your portfolio, you might be right in the other.

Diversification is the key; it always has been and always will be. In the horrible years of 2000-2002, not being diversified in your portfolio, and too invested in tech funds, would have meant huge losses. Starting in March of 2000 the stock market started to go down and didn’t stop going down until October of 2002. At that point, the NASDAQ dropped from 5200 to 1100 and the Dow dropped from 11,700 to 7200! Not being diversified with those kinds of losses could have meant the end of your investing career. And has the year 2008 taught all of us, history DEFINITELY does repeat itself. IN my humble opinion one of the worst mistakes you can make in mutual fund investing is paying either a back end or front end fee. The number one rule of buying a mutual fund is never pay a front end or back end fee. Also remember to rebalance your portfolio every few months.

Are You Buying Businesses For Sale?

Wednesday, July 22nd, 2015

For the people who do not want to live pay check to pay check anymore, they would think of another means of earning their living. But some business models take too long to achieve success such as the traditional company. It is harder to make this business successful since you have to formulate your own way of doing things in order to see order and profit for the venture.

Compared to franchises, the traditional business will dim in many aspects. Why is franchising the better alternative? When you have money to buy a franchise, then you will be able to start a business right away. It would not be essential that the business owner has previous experiences at handling a business, although it would be an advantage if the person has that capacity. The plan is laid out completely, from staff training, product supply, advertising and location, everything is ready for the entrepreneur who wants to take a shot at franchising.

It is a reality that not all people have enough money, so there are times that financial backing is required. Since banks are not that supportive to entrepreneurs nowadays, some people get their additional capital from financing companies. Those that are involved in franchising have discovered that it is easier to manage their businesses because they are supported all the way, even with new products that are introduced in the market.

Why is franchising more advantageous? The market for these businesses for sale is already established. Thus, the new franchised unit bought by the budding entrepreneur has no need to carry out large marketing and advertising campaigns.

Furthermore, the business owner can give themselves their designated title according to their strengths. It is now possible that a job description is tailored to the capacity and skills of the owner, thereby giving clarity to the delegating of workloads and functions to other employees that have different sets of skills.

Franchises are considered low-risk business ventures and due to this nature of the venture, many are flocking to get their own franchises. This also makes the whole franchise business stronger, because they can have their presence in many areas when people are willing to invest in this kind of business. This can give the impression that they are a market leader and has many branches in many locales.
There is familiarity with brand and products for franchises, and this is one main reason that people prefer this business over others.

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