Black Swan Management, LLC

Investments and Strategies for the Future of Business

Posts Tagged mutual funds

What is a Mutual Fund?

Mar 10

Posted by Paul Cris in stocks, strategies | No Comments

Mutual fund is a corporate body, which works as an intermediary and invests in financial markets. Mutual funds collect money from the public and invest in financial instruments like equity, government securities, bonds, debentures etc.

Investing through mutual funds is good for people who do not have much knowledge about the financial markets. Instead of burning the fingers in the stock market, investing in mutual funds does make sense. There are various types of mutual funds available for investment. There are different types of mutual funds available, like, a fund, which invests only in Pharmaceutical companies, is called as Pharma fund and the mutual fund companies name the funds on their own. The mutual fund companies provide prospectus when they launch a fund. In the prospectus information like risk involved, amount of money invested in stocks, bonds etc are mentioned.

The money collected is invested by professionals who have experience in the financial markets. They know the time to buy and sell the stock. Their main aim is to create wealth for their investors. They diversify their portfolios and invest in growth related companies. Mutual fund companies hire professional fund managers who have very good experience in handling large amount of money. While buying a mutual fund you should check the experience of the fund manager and his team, who will be investing your money. You should also take a look at the past performance and the returns offered.

You can start buying mutual funds for a very low amount and you can also invest every month. This is called as systematic investment planning. There are various types of funds like open ended fund, close ended fund, growth fund, income fund, balanced fund etc.

Author: Paul Cris
Article Source: EzineArticles.com
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No Load Mutual Funds: Investment Hype vs. Investment Help

May 29

Posted by Ulli G. Niemann in mutual fund, stocks, strategies | No Comments

With the internet such a huge part of our daily lives, many investors have access to a wide range of instant investment information.

Whether youre into stocks, bonds, mutual funds, futures or options, there are tons of electronic investment newsletters offering to turn your small stake into a giant fortune. All you need to do is subscribe and watch your portfolio soar.

Yeah, right!

As a practicing investment advisor specializing in no load mutual funds, I have received my share of e-mails from disillusioned subscribers wanting to know how to better evaluate newsletter services.

While there are no absolutes, I can give you a few pointers that might help you make a better decision:

1. Stay away from the most obvious hype. Ads promising to turn your $10,000 into $1 million in 2 years by buying this incredible stock or hot commodity are not promoting investing they are selling gambling. Follow the “If it sounds too good to be true, it usually is” rule.

2. Most mutual fund newsletters wont make those outlandish claims, but some of them are still pushing the truth as far as they can. So try to get a free issue or two to examine. If you can’t get a sample, check if they have a trial period? How about a money back guarantee? If not, pay with your credit card. These days youre pretty well protected by this payment method even if the newsletter doesn’t offer a satisfaction guarantee.

3. Consider the editor as well as the disclaimer notes. Is he or she only publishing a newsletter? Or is he also an investment advisor with a practice?

Why would that last point matter? I may be biased, but I believe that you get far better advice from a writer who also is in the trenches every day investing their own as well as their clients portfolios. They would have far better insights as to what works and what doesnt than someone who has the theory down but no practical experience.

4. Look at the investment recommendations. Are they suggesting you buy into a certain orientation such as mid cap, small cap or large value? Or are they picking specific investments based on a variety of technical indicators?

In my no-load mutual fund practice I use specific recommendations, even for my free newsletter subscribers. They are first based on my trend tracking indicator giving us the green light and secondarily on the selection of mutual funds based on momentum analysis.

The more specific the recommendations, the better, because that allows you to follow along either just on paper (which you should do at first) or with your actual portfolio.

5. Are they recommending when to sell a mutual fund either because of gains or to limit your losses? This to me is the most important issue. If there is no plan in place for getting out, how will you ever know when to sell? This has been the greatest downfall of most publishers (and investors!) since the bear market of 2000 not selling even if market conditions dictate it would be in your best interest to do so.

The advice of most newsletter services can make you money in bull markets. However, with the continuation of the bear market still a distinct possibility; be sure to look at any newsletter’s investment advice record since 2000.

For many people investing is an emotional issue. The pendulum swings between fear of loss and greed for greater returns. If a complete methodology for buying and selling is offered in a newsletter, such as one I advocate, be sure that it fits your emotional make up.

There is no sense in following an investment approach, which may have merits, if it means sleepless nights for you. You wont stick with it for the long term and long-term investing is essential for making your portfolio grow and prosper.

So, the bottom line is to look for a newsletter that:

  • does not promise the moon,
  • has a track record through up and down markets, and
  • recommends an approach that not only is compatible for your investment style but also has an exit strategy so you can capitalize on your gains — in the bank, not only on paper.

Following these guidelines may not make you rich, but it will help you avoid some bad advice.

Author: Ulli G. Niemann
Article Source: EzineArticles.com
Provided by: Excise Tax

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Using Sector Funds to Construct Diversified Mutual Fund Portfolios

Apr 21

Posted by Sam Subramanian in investing, mutual fund, stocks, strategies | No Comments

Sector funds are too risky. I doubled my money with Fidelity Select Technology in 12 months! Avoid sector funds. If all of this sounds confusing, you are not alone. Sector funds are among the more misused and misunderstood investments. So, how should you use sector funds?

Before looking at one of the uses of sector funds in detail, lets review what sector funds really are: Sector funds confine their investments to a particular sector of the economy. Fidelity Select Healthcare (NDQ: FSPHX) is an example of a sector fund. By focusing on stocks of companies in the healthcare sector, the price moves of this fund are more dependent on factors that impact the healthcare sector rather than the economy as a whole. Demographic change, such as increasing age of the population, is an example of a factor that particularly drives investments in healthcare. By diversifying its assets across over 60 companies within the healthcare sector, Fidelity Select Healthcare provides investors with the opportunity to benefit from secular trends driving the demand for healthcare while mitigating company-specific risks such as failure of clinical trials conducted by a particular company.

Lets now look at a high-potential approach of using sector funds.

Using sector funds to create a diversified mutual fund portfolio By allocating assets across a group of sector funds, investors can effectively create a diversified mutual fund portfolio using sector funds. This approach gives the investor flexibility to over-weight or under-weight certain sectors versus broadly diversified indexes such as the S&P 500.

To implement this active approach to money management, it helps to have a diverse group of sector funds to choose from. Fidelity Investments manages 41 sector funds under the Fidelity Select Portfolios umbrella which makes this family of sector funds well-suited for this purpose. By dividing assets across, say, 8 sector funds in the Fidelity Select Portfolios, e.g., Fidelity Select Biotechnology (NDQ: FBIOX), Fidelity Select Computers (NDQ: FDCPX), Fidelity Select Energy Service (NDQ: FSESX), Fidelity Select Home Finance (NDQ: FSVLX), Fidelity Select Medical Delivery (NDQ: FSHCX), Fidelity Select Multimedia (NDQ: FBMPX), Fidelity Select Retailing (NDQ: FSRPX), and Fidelity Select Wireless (NDQ: FWRLX), one can build a customized diversified portfolio. With each of the sector fund managers actively scouting for the best investment ideas within their sectors, this cluster of Fidelity Select Portfolios packs a lot of power into your diversified portfolio.

Other mutual fund families that provide a relatively wide choice of sector funds include ProFunds and Rydex Funds. Exchange traded sector funds such as Select Sector SPDRs, iShares, and Sector HOLDRS, that trade on the American Stock Exchange, can also be used to construct diversified sector fund portfolios.

The wide selection of sector funds available provides you with the ability to take advantage of changing market conditions and continually optimize the risk-reward characteristics of your diversified portfolio. To employ this approach effectively, you need to understand and follow the dynamics of the individual sectors. You must also be able to make informed decisions on sectors to select and sectors to avoid. At the end of the day, you should be right more often than wrong with the sectors you select.

AlphaProfit.coms research suggests that by constructing diversified mutual fund portfolios using sector funds, investors have the potential to outperform the market averages on the basis of relative returns as well as risk-adjusted returns. The track-record of AlphaProfits model portfolios indicates the potential of this approach.

A Caveat

Diversification is one of the cornerstone principles of mutual fund investing. Sector funds that focus on high-growth sectors or narrow niches of the economy tend to be volatile. It is generally not advisable to commit a substantial portion of your total assets to a single sector fund. Maintaining adequate diversification across sectors in your overall mutual fund portfolio is good investing practice.

Key Points to Remember

1. Sector funds are investment vehicles that focus their investments on a particular sector or industry group. Sector funds provide investors with an opportunity to profit from trends impacting a particular sector or industry while reducing company-specific risks.

2. High-potential diversified portfolios can be constructed by dividing assets among a group of sector funds. This active investment approach requires investors to make informed decisions on sector selection. The power-packed cluster of sector funds may offer investors the potential to outperform the market averages.

3. Diversifying mutual fund portfolios across sectors is good investing practice.

Notes: This report is for information purposes only. Nothing herein should be construed as an offer to buy or sell securities or to give individual investment advice. This report does not have regard to the specific investment objectives, financial situation, and particular needs of any specific person who may receive this report. The information contained in this report is obtained from various sources believed to be accurate and is provided without warranties of any kind. AlphaProfit Investments, LLC does not represent that this information, including any third party information, is accurate or complete and it should not be relied upon as such. AlphaProfit Investments, LLC is not responsible for any errors or omissions herein. AlphaProfit Investments, LLC disclaims any liability for any direct or incidental loss incurred by applying any of the information in this report.

The third-party trademarks or service marks appearing within this report are the property of their respective owners. All other trademarks appearing herein are the property of AlphaProfit Investments, LLC. Past performance is neither an indication of nor a guarantee for future results. No part of this document may be reproduced in any manner without written permission of AlphaProfit Investments, LLC. Copyright 2004 AlphaProfit Investments, LLC. All rights reserved.

Author: Sam Subramanian
Article Source: EzineArticles.com
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You’re Invited…

Jan 29

Posted by admin in Uncategorized | No Comments

to the following event:

FREE Retirement Plan Investing Strategies Workshop!

Learn How To Leverage & Build Your Retirement Accounts TAX-FREE! Retire Younger & Wealthier!

If Your Nest Egg Is Important...Join Us!

Saturday, January 30, 2010 from 9:30 AM – 4:30 PM (ET)

American School of Business
194 Rt. 46 E. – 2nd Floor
Fairfield, NJ 07004

WANT MORE INFORMATION?

READ THIS LETTER FROM AMERICAN SCHOOL of BUSINESS:

Dear Friends,

I’ve watched so many folks position themselves to earn more money through business and real estate. In our current economic environment there is so much opportunity out there if you only know how to grab it and what to do with it. But along with earning more money, you also need to learn how to keep more of your money! Well, that’s what you’ll learn at this workshop!!! You’ll learn how to leverage your retirement and investment accounts to invest in business and real estate opportunities and never pay taxes on your income and retirement funds again!!!!!

We have 2 amazing instructors lined up for this full-day event, you’re going to get your share of knowledge and know-how to start keeping more of the money your making! Learn how to grow your retirement Tax FREE!!!

Do you want to retire younger and wealthier?!?!?!

We’re going to show you how to do it!!!

Meet The Instructors:

JIM ALLFREY

Jim Allfrey began his business career in the retail supermarket industry, quickly advancing and serving in a number of key management positions. He ultimately became Partner and Chief Operating Officer before selling his interest in the supermarket business and becoming a full-time real estate investor in 2004.

Jim is the President of American Pension 401(k) Services, Inc., providing administrative services for fully self-directed 401(k) retirement plans to business owners and their employees. The Total(k)™ allows plan participants to invest in anything allowed by law, from “traditional” mutual funds to “non-traditional” options, including real estate, trust deeds, mortgages, options, private companies, stocks, bonds, etc.

Jim owns a successful real estate investment business and is also a licensed Utah Realtor®. His real estate experience includes creative acquisitions, pre-foreclosures, short sales, residential properties, commercial sandwich leases, contract negotiations, new development, as well as property management, rehab and remodels.

Jim’s exceptional analytical abilities and human resource skills provided a solid foundation for his real estate investing career. Utilizing over 30 years experience in business management and operations, Jim motivates students to successfully operate their own companies using strategies to build their long-term wealth and achieve financial freedom. Jim’s motivation to help others achieve their success arises from his “pay-it forward” philosophy, and a belief that our attitude and determination are more likely to determine our success than any other factor. He shares his personal experiences and knowledge to help his students achieve the success that they desire.

CURTIS DEYOUNG

Curtis L. DeYoung is Founder, President, and Chief Executive Officer of American Pension Services, a company organized in 1982 for the purpose of allowing the more aggressive investors to direct, individually, their retirement funds as broadly as the law allows.

DeYoung realized early in his career that true self-directed retirement plans were rare and virtually unavailable to the average, individual investor. The industry was dominated by brokerage firms, insurance companies, and banks that sponsored limited investment options for retirement plans. Still today, most IRA sponsors allow only the investments that benefit them the most, rather than the unlimited investment options allowed by law. Everyone in the financial world knows that you don’t take investment advice from a person who receives a commission. DeYoung recognized that an objective, third-party administrator who wasn’t offering a financial product for sale could help customers capitalize on the unlimited growth potential and power in self-directed retirement plans.

Unable to find a company that allowed him to invest as he desired, DeYoung founded American Pension Services (APS). APS is a genuine, self-directed, retirement plan administration company that provides the vehicle for true self-direction, without the conflict of interest of financial products to sell — a unique and rare combination in the financial world. American Pension Services currently administers over $100-million in self-directed retirement plans, and combined with their FDIC-insured custodian, First Utah Bank, can offer investors maximum flexibility, security, and freedom to invest as aggressively as the law allows.

A new division of American Pension Services, called American Pension 401(k) Services, was founded in 2008. Home of the “Total K”, this new division allows 401(k) sponsors the freedom to self-direct, with the only online 401(k) plan in the country offering every investment option available, including the traditional investment options.

Curtis and his wife Michelle are parents of four daughters, all varsity cheerleaders, until number four, Hailee, broke with the DeYoung family tradition to become a soccer, basketball, and track star! The family resides in Draper, Utah.


This is going to be a life changing event and well worth your time to join us!!!



I look forward to seeing you there!

Yours In Financial Freedom,

The American School of Business



Can you attend this event?  Respond Here






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