5 Key Benefits of a Robo-Adviser
Robo-adviser is an automated online wealth management service or a class of digital online financial institutions that offer financial advice or investment management tips online with minimal human intervention. The algorithms are executed by software to allocate, manage and optimize clients’ assets. Being online, however, does not make it less effective and ideal financial institution as it has almost all the aspects of the physical human involvement.
6 Key Factors to Consider Before Making a Private Equity Investment
Private equity refers to investments funds structured as limited partnerships that are not listed on a public exchange and its investors include large institutional investors, wealthy individuals, and university endowments.
Top 4 Best Commodities to Invest
Commodity trading involves trading in commodity derivatives and spots. Commodity trading is very volatile and so investors should take relevant precautions before they enter into it. Commodity trading can help an investor to diversify their portfolio. It is an ideal investment that can significantly hedge you against the risk of inflation. Commodities traded mostly include agricultural products, minerals, and fossils.
5 Common Types of Financial Swaps
A swap is an act of exchanging one thing for another. In finance, swaps are derivatives wherein two counterparties exchange financial instruments. The swaps can involve an exchange of a series of cash flows of one party’s financial instrument for those of the other party’s financial instrument over a specific period of time. Swaps are mutual agreements that are easy to design and customize over the counter. They offer great flexibility that leads to many swap variations with each serving a given purpose. Reasons why parties agree to such arrangements: If their investments or repayment objectives change If it is beneficial financially to switch, to a new or alternative stream of cash flows compared to the existing ones To hedge against risks such as mitigation risks associated with a floating rate loan repayment. Here are the 5 common types of financial swaps: 1. Interest Rate Swap This is the most popular type of swaps. An interest rate swap is a contract between two parties to exchange a stream of future interest payments based on the principal amount. The parties exchange floating interest rate for a fixed rate or vice versa to increase or reduce exposure to interest rates volatility to obtain a marginally lower rate than would have been possible without the swap. It can also involve the exchange of one floating rate for another and usually occurs only to change the type or tenor of the floating rate index usually called basis swap. It usually occurs if a company can obtain a loan easily at one type of interest rate but prefers a different type of rates. 2. Currency Swaps Currency swaps involve the exchange of interest and in some cases of full exchange of principal amounts in one currency for the same but in another currency. It is also referred to as cross-currency swap as it involves foreign exchange transaction. It is a very flexible method of foreign exchange as maturities of the currency swaps are negotiable for at least 10 years. The interest rates can be floating or fixed and the exchange can be fixed vs. fixed, floating vs. floating and fixed vs. floating. The swap helps to hedge against interest rates and forex rates fluctuations for long-term investments. 3. Commodity Swaps A commodity swap is a financial derivative agreement where two parties agree to exchange cash flows which are reliant on the underlying commodity price. This swap is most common among people who use raw materials to produce finished products. It is used to hedge against the price of a commodity. It consists of a floating-leg component and a fixed-leg component where the floating-leg component is attached to the market price of the underlying commodity or agreed upon commodity index and the fixed-leg component is specified in the contract. These swaps are settled in cash but the physical delivery is predetermined in the contract. 4. Credit Default Swaps The credit default swap offers insurance in the event that third-party borrower defaults. It helps transfer between two or more parties the credit exposure of fixed income products. The swap buyer makes payment to the swap seller until the date of the maturity of the contract. The seller in return agrees that they will pay the buyer the security premiums in addition to all interest payments that would have been paid between that time and the security maturity date in the event that the debt issuer defaults. 5. Equity Swaps An equity swap is a financial derivative contract where two counterparties agree to exchange a set of future cash flows at set date’s n the future. The two cash flows are known as legs of the swap. The legs of the swap include the floating leg which is pegged to a floating rate such as LIBOR and the other leg component is the equity leg which is based n the performance of either a share of stock or a stock market index. Equity swaps help avoid transaction costs such as tax, limitations on leverage and get around policy governing a particular type of investment that an institution can grasp. Summary Swaps can be designed and structured in different ways to meet the needs of all the parties as they are offered over the counter (OTC). However, they are unregulated and so every investor should fully understand the implications of the swap before they enter into the contract.
6 Key Benefits of Investing in Dividend Paying Stocks
Dividend-paying companies distribute a portion of the net income to the stockholders each year and reinvest the remaining profits back into the business. The payments are usually quarterly though there are companies that pay monthly.
3 Types of Profit Margins to Determine Before Investing in a Stock
To decide whether or not a particular company’s stock is worth including in a portfolio is a daunting task. An investor must analyze various company aspects before they invest their dollars. One key aspect to consider is the financial position of the company and more particularly the profit margin. A profit margin is the amount by which revenue from sales exceeds costs in a business and is usually expressed as a percentage.
9 Types of Hedge Funds That Investors Need to Know
A hedge fund is an alternative investment that pools capital from accredited individuals to speculate and uses diverse strategies to earn active alpha or return for the investors. To achieve a greater return on capital, hedge funds utilize different strategies and investing styles. All the fund types generally fall into five categories which include macro, event-driven, arbitrage, long/short and tactical trading. Here are the 9 common types of hedge funds that you need to know:
8 Best Stock Investment Apps for Beginners
Investing is a daunting task and sometimes could be confusing especially for a beginner. In the past, an investment process began by making a call to a brokerage firm to obtain an advisor who would advise the investor throughout the process. However, the technological advancement has made it easier for beginners who want to start trading. Now, they can just download an app on their PC or Smartphone and use it to trade securities. Different apps offer automation, low cost and high-security measures to make investing easy and exciting for all. Here are 8 best investment apps to download and use to invest in stocks: 1. Stash Stash lets the investor trade with as little as $5. It recommends a collection of investments based on the investor profile details as well as such factors as managed risk, low fees, and historical performance. It also has tips and articles to help the user scale up their investment know how each time they access the account. 2. SigFig SigFig is yet another interesting investment app. It has investment tools that can track, manage and maximize the investor’s portfolio. It also allows users to manage their entire investment through the app. Users can receive latest market news and statistics on relevant companies. 3. Yahoo Finance Yahoo Finance app allows users to synchronize portfolio and quotes across different devices track commodities, stocks, currencies and more. It has an easy to navigate user interface and the users can easily conduct a quick stock check and allow push notifications to get instant updates which help them make informed investment decisions. 4. Acorns Acorns is yet another investing app for first-time investors. It allows investors to invest their balances where it rounds up investors’ regular purchases on credit and debit transactions linked to it every day. App instantly trades with the remaining balance into a diversified portfolio of index funds chosen by Harry Markowitz. It is an easy, quick and automatic way to invest. It charges a percentage of the user account balance as a monthly service fee and thus the user should avoid leaving a lump sum amount in the account over a long period of time. 5. Stock Market Simulator This app gives the investor the ability to attempt trading before they make an actual trade. Users can play with a simulated model of the real market by investing virtual funds before they can start the real trading process. It is a good way to get a dummy account that lets an investor learn how stock market work without using actual money. 6. TD Ameritrade This app is by TD Ameritrade which is one of the largest brokerage firms in the US. It focuses on the essentials of investing such as streaming quotes, real-time balances, mobile access to trading, fund transfers, and getting latest news and market research reports. It has a Snapstock feature which allows users to snap a barcode or a picture on any item to get the company name ticker symbol and stock quote as well as related news and visuals. 7. Stockpile This app allows the user to trade but also to gift single shares of stock or rather purchase fractional shares with as low as 99 cent trade fee. This allows the investor to buy fractional shares of high-valued stocks such as Google, Amazon and Berkshire Hathaway without spending $1000 or more per share. It is also a great app for kids’ teens and family because it allows the investor to buy and gift shares of stock. 8. Robinhood Robinhood app allows an investor to trade US-listed and OTC securities such as in stocks, options and ETFs for free. Robinhood account gives an investor an access to instant deposits. Key Takeaway Investment apps have helped automate the investing process and first-time investors can obtain massive benefits from using them.
5 Significant Reasons to Trade Forex
Forex or the foreign exchange market is a decentralized or over-the-counter (OTC) market whereby currencies are traded at current or determined prices. This market brings together central banks, investment banks, commercial banks, hedge funds retail traders among other professions. According to the Bank of International Settlements (BIS) last triennial survey, the size of the forex market turnover was $5.2 trillion as of 2016. The forex market is thus the biggest financial market in the world.
6 Major Types of Strategies Traders can Opt for in Forex Trading
Trading Forex (FX) involves trading of currencies where you can buy one currency while selling another for speculation purposes. Forex trading just like any other investment involves taking calculated risks. When trading forex, you can make profits or losses. You need to master the best forex strategies that can work for you to benefit from forex trading. Currencies tend to fluctuate due to various factors like geopolitical, economical and more. The aim of trading in currencies is to make profits from the changes in prices.
3 Ways to Trade Forex
Forex exchange is an international market for trading currencies. According to a survey by the Bank for International Settlements in 2016, the average daily forex trading was 5.1$ trillion and of this, spot trading made up $2.6Traders have trillion.
Become a Successful Forex Trader in 4 Simple Steps
To become a successful Forex trader, you need to learn, practice and set a clear plan for the trade. Getting into the Forex business is easy and you can follow a few simple steps. You need to learn how to mitigate losses while maximizing profits which you can achieve by identifying good trade setups that have a positive risk and reward set up. Here are 4 steps you can follow to become a successful Forex trader: Step 1: Research and open an online Forex brokerage Research on different Forex brokerage accounts available in the market that is regulated by an oversight body. Visit their website, ensure that it has active links and read reviews about them. Find out the transactions cost per trade. Request for information about opening an account with them, you can choose either a personal or a managed account. A personal account enables you to execute your own trades and the broker will execute trades for you in a managed account. Step 2: Use a Demo Account The next step is to open a demo account that acts as a trading account with monopoly money in it which is connected to the live market. You can place trades just like in trading in a live account and have true losses and gains represented in real time. You should be able to trade profitably on your paper trading or demo account. You need to do a lot of practice before you commit your real cash to this trade. Using a demo account, you can practice the trade until you are contented. This is quite helpful because it gives the feel of the trading platform and you get well acquainted/versed with its features. However, do not overtrade on a demo account, switch to a live trading account as soon as you are ready. Step 3: Learn and practice FX trading before going live Another important aspect of forex trading is learning the Forex trading terminologies. You can read material and watch webinars to understand Forex trading better. Get advice from a forex trainer. You will need to develop unique trading style and strategies as a trader. Developing such strategies takes time and efforts and is a trial and error process. You can choose to become a swing trader, a positional trader etc. Set stop-loss order for every trade. Set a margin of about 2% per single trade. Never place a trade in a bid to compensate a previously incurred loss. Trade at the moment that you feel its right and never fear losses, every trader has them. Step 4: Get the trading capital and start trading Forex trading doesn’t necessarily require a lot of minimum capital to trade. The Forex trader should seek to trade on margin. On average a Forex broker requires at least $300 to open an account and to begin trading. A general rule of the thumb is to have at $1000-$2000 to open a mini account. It helps the trader to have a bit of buffer in case of losses. The idea is to avoid risking the entire amount but rather have just a higher cushion so that you can remain as a trader for longer. It is difficult to know when you are fully ready to switch to live trading. The process should take about a month after you gather a good understanding of the market and the risks involved in forex trade. You need to analyze the market and then determine your margin. You can then place your order, for example, a market order, a limit order or a stop order. It takes time effort and passion to become successful in Forex trading. Keep on keeping on until you all master the tricks of the trade.
Norman Logistics Sp.zo.o Offer Report on the Growth of the United Arab Emirates - Significant Investments Into the Human Capital and Infrastructure