Invest and Prosper: Goals & Discipline

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In mounting an imperative challenge, it is essential that realistic long-term targets be set according to individual aspirations, time horizons, risk tolerances, tax brackets and comfort zones. It’s like embarking on a long highway journey in which there could well be many bumps and detours – maybe even the occasional flat tire or accident – along the way before arriving safely at one’s destination.

GOALS

Investment goals can vary according to individual lifestyle preferences, estate plans and designated beneficiaries and charities. In addition, they can change as economic and market conditions change and/or as we change; for example, from needing current income to finance a growing family to focusing increasingly on the accumulation of latter-year savings for those ever-lengthening years in retirement.

DISCIPLINED

If there is a single constant in a multi-changing and ever-challenging process it is the importance of building wealth according to a customized and well-constructed investment plan without having to risk precious (and hard-won) savings beyond affordable limits. It follows that successful investing must be a systematic long-term affair in which en passant volatility, distractions and temptations are rigidly subordinated to a

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Too Late for Gold?

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I was 13 when India was in crisis. It had borrowed too much money in dollars and was desperate to pay it back.

India needed dollars badly. So the government came up with a scheme to get it from people like my father who were earning money in petrodollars.

The Middle East was booming, and thousands of Indian people had followed my dad’s example and gotten jobs in Dubai and places like it. They were benefiting from the fast-growing economy there.

Dubai’s currency is easily exchanged into dollars, and India was desperate to lure my father and others like him into lending those dollars to the government.

To do this, India offered my father a once-in-a-lifetime deal: Lend your dollars to India, and get 18% interest per year tax-free for 30 years. To sweeten the deal, the government set it up so you could get your money back in dollars after a couple of years if you wanted – or keep earning 18% tax-free for 30 years.

Eighteen percent is an astonishingly high rate of return. You’d be lucky to get that from stocks or risky

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Is a Monthly Income Bond Worth Paying For Every Month?

Most investment plans pay either annually or bi-annually. Stock gives you the earnings quarterly, but there is a lot of risk when investing in the stock market. Therefore, this bond has been introduced to help you build a portfolio which can pay dividends every month. This investment product can ensure you have a reliable income after retirement to help pay your living expenses.

When you invest your lump sum in a monthly investment plan, then the bond issuer gives you the coupon payment (interest amount) monthly on the investment, however, the interest is calculated daily.

There are several benefits over other types of investment which are listed below, if you invest your savings in a Monthly Income Bond:

Lucrative & Less Risky:

This type of bond is labeled with good monthly returns and is also less prone to risk. These are the reasons that make this product a lucrative deal for investors. Your capital amount is safe and the interest amount will transfer into your account every month. However, the amount of interest may vary with inflation, but won’t stop the monthly payments.

Tax Exempted:

Investors can build a good portfolio investing their money in this type of bond. The interest amount is paid tax-free,

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Savings and Investments – How Are They Different?

Savings and Investments are absolutely important for every citizen. They can be used in various ways to meet expenses but it must be understood that there are some major differences between the two.

Economists and bankers always advise that ‘savings’ as a habit has to be learned at a very young age; this essentially teaches the value of money in a small way and helps to understand macroeconomics at a later stage. Saving money and investing money are two completely different concepts altogether; savings is part of the money left over after monthly or annual bills and expenses have been met or keeping aside a certain portion of the income. Savings are generally used to deal with unexpected expenditure like an illness or unforeseen accident, home repairs, educational expenses etc. It can be a pre-fixed percentage of total earnings like 10 percent or 20 percent. In other words, savings is hard cash ‘saved’ from expenditure by being cautious or avoiding an expenditure altogether. Investments on the other hand pertain to that certain sum of money put aside in financial products or systems to generate returns and increase incomes.

The three prime factors where savings and investments differ are:

• Time – savings

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The Dollar Value of Gold

Breaking Golden Rules

Modern day economics has added more value to Gold than the fundamental worth of the yellow metal. Although the most radical changes have come about by means of aggressive marketing of the commodity, Gold has always been the darling of the murky derivative trading world. The intrinsic value of the commodity has successfully attracted Hedge Fund managers across the globe so much so that billionaire hedge fund manager Paul Singer who oversees an AUM (asset under management) of $27 billion has been recently quoted saying “It makes a great deal of sense to own gold”. Singer believes, that in the highly competitive world of business, the weakness of the Dollar evolves into a pillar of strength, boosting the export volume of the United States even as the world’s Central Bankers are focusing on devaluing their respective currencies as well.

When Zero Means More

Near zero lending rates have failed miserably to recreate the much waited financial magic that Central Bankers were hoping for, while deflationary scenarios are back square on the court turning low inflation and high unemployment into a complex quagmire. The world’s top economies are fast spinning into a death spiral thereby propping up the dollar value

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What Are Hedge Funds?

You might have heard about George Soros and his famous Quantum Fund, the very ‘weapon’ that ‘broke’ the Bank of England (a central bank) way back in 1992, forcing it to devalue the British Pound.

The Quantum Fund is what we call a hedge fund. So what are these investment instruments?

Hedge funds are loosely regulated investment companies that seek to generate absolute returns uncorrelated with any market benchmark or index. In other words, they strive to maximize their returns regardless of the current market scenario.

These instruments also utilize a wide variety of trading strategies, and may or may not use hedging techniques to reduce or eliminate their risks, in line with the trading strategies they adopt.

While the Quantum Fund no longer exists (the fund ended by the end of 2011 after returning all external funds, and is now privately managed by the Soros’ family fund), these class of funds continue to gain popularity among institutional investors and high net worth individuals. The global hedge funds industry is valued in excess of $1.7 trillion, and is ever-growing.

Hedge funds are a distinct class of funds on its own, and have distinct characteristics that differ from the traditional mutual funds (also commonly referred to

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Basic Things You Must Know About Stocks

A stock is often represented by a stock certificate, which is a piece of paper proving ownership. In today’s digital age, you won’t see this document since your brokerage will keep these records electronically. This is being done in order to make the shares very easy to trade.

Before, if a person wants to sell his shares, he will take the certificates down to the brokerage. But today, trading with just a click of the mouse or perhaps a phone call will make life a lot easier for everyone.

When it comes to individual stocks, there are no guarantees. There are some companies paying out dividends while the others don’t. Bear in mind that without dividends, an investor can make money through this investment form through its appreciation in the open market. On the contrary, it may go bankrupt.

Though risks may sound negative, it also has a bright side. Taking on greater risk will demand a greater return on your investment. It is actually for this very reason why stocks have outperformed other investment forms like savings accounts and bonds.

2 Main Types

Common – This represents ownership in a company and a claim or dividend on a portion of profits. Investors will

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