Stocks and Mutual Funds

I have started on investing in the mutual funds. I invested in FAMI thinking that it is better, at my current scenario to invest in mutual funds than in stocks. For one, I do not have the full know-how on this type of investment.  Aside from that, I do not have the time to fully invest in ensuring that my money will be fruitful with stock investing.

Here is what I think one should ought to know in investing into stock or mutual fund:

1. If you do not have the experience, go for Mutual Fund.
2. If you do not have the time, go for Mutual Fund.
3. If you are not risky, go for Mutual Fund.
4. If you are mature (in age :)), go for Mutual Fund.

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Is Investing in the Real Estate Properties a Wise Decision?

There are no sense of security in this world especially so when we speak of stock market, funds, and the economy. Currently, the financial market is still in the recovery phase due to the economic chaos brought about by the American economic problems. Thus, there are a lot of investors who placed their trust and money in to this arena is still at a loss. Since these kinds of investments fluctuate from time to time, it is often best that a wise investor should also have investments in the real estate business.

Investing in the real estate is just one of the investment vehicles that may guarantee you a safe place for your money. This is due to the fact that lands will always appreciate in time. Also, selling homes and residential places are investments that have good return of income.

There are disadvantages also when delving into the real estate world. Starting on one needs large capital and reserve cash as real estate may take time to dispose of. Also, if you intend to develop the place before selling it will this will add up to your starting capital.

Nevertheless, real estate investments are a good decision to put your money to. But as with other investments there are certainly negative as well as positive sides to it. Thus, it is a good decision to also invest on other vehicles so as to balance your risks.

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Diversify: Key to successful investing

With every business comes risks, and even greater if you put your money in stocks or mutual fund, this is because these investments are volatile. Stock prices increases and decreases every minute or so, so predicting its trends may not be that easy, unless you have a superpower prediction software installed in your brain.

So why is investing in stocks very risk? For people like me who have not gone to Business schools stock is a term not usually discussed and most are not that acquainted with this term. So what is a stock? According to www.investorwords.com, it is an instrument that signifies an ownership position (called equity) in a corporation, and represents a claim on its proportional share in the corporation's assets and profits. Therefore, when you buy a stock offered by a certain corporation you become a part-owner of that company. And if they obtain profit, you also get profit but the downside is that if they lose, so will you. And predictability of when profits are good and losses are bad are never determined easily.

How do we keep our money from catastrophe? We need to have many investment baskets in order to do this. It is a good decision to divide your money and invest it to many kinds of stocks, or investment baskets. For example, you invest a quarter of your money to agriculture stock, a quarter to mutual fund, a quarter to government bonds, while the last quarter to mining…the list is endless; it is up to you to decide. You can even follow the cost averaging technique to widen your grasp to more investment profits.

Why diversifying your investment a way to success?
• Manage your risk better. In this way, if one investment is losing, it could be compensated with a profit-earning investment.
• Increase profit. It is not always that your stocks are giving you benefits, most often, investments losses, stock prices are going down therefore, if you have invested in only 1 “basket” you may definitely loss that hard-earned money.

Furthermore, diversifying is the key in winning this investment battle. If you will only put all your money in one asset there is a greater risk that you will either win or lose. A two-faced coin will only give you the head or the tail. But if you have many interests in many investments, you are able to manage your portfolio well and may in turn get more profits.

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The Importance of Cost-Averaging Scheme when into Mutual Fund

The cost-averaging strategy is very applicable in succeeding when you are investing in mutual funds or when you are into common stocks. By employing this approach, an investor can greatly increase his chances of earning higher net over a period of at least 5 years and also reducing his risks of losing.

How does it work?

Before we proceed, let us first discuss what a cost averaging technique is all about. Firstly, it is designed to reduce market risk through careful planning and buying of securities and investments at a predetermined interval and with a predetermined set of amount. Many investors are practically applying this, and most, if not all, have attested that cost averaging is a technique that delivered them better profits.

Instead of investing or buying stocks in a lump sum, an investor buys securities at smaller prices slowly and in regular intervals, says every month.

Let me put it this way, you have 10, 000 USD and you have been eyeing on an investment worth 2USD per share. Instead of using up all of your 10, 000 to buy the stock, what you are going to do, in following cost averaging technique, is to buy 1000 USD in the first month, then another 1000 on the second month, and so on until you exhaust all your 10, 000. This spreads the cost basis out over several months, providing insulation against changes in market price.

If you are going to calculate, you will fare better than buying the whole thing one time.

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Mutual Fund Basics

Just what is a mutual fund? I think, for most of Filipinos, this kind of investment is a mystery. In fact I have never heard of this term in my entire school life. What I do know is saving in the bank and physical investments such as putting up a sari-sari (convenience) store or selling barbeque on the streets. Stocks or funds were terms uncommon to me during those days.

DEFINITION
According to wikipedia, a mutual fund is a professionally-managed type of collective investment scheme that pools money from many investors to buy securities (stocks, bonds, short-term money market instruments, and/or other securities). A mutual fund has a fund manager that trades (buys and sells) the fund's investments in accordance with the fund's investment objective.

In layman’s term, it is a kind of fund wherein groups of people share their money in order to buy a stock, bond or other investment securities. The pooled money is then managed by a fund manager, which is basically a person “employed” by the investors, to buy and sell stocks and investments.

WHY INVEST IN MUTUAL FUND?
Doing business or investing into something entails risk. This is also the case for mutual fund.
Unlike with other investments, the risk with mutual fund is minimal. Why? Because you have a fund manager, who is professionally trained who does the analysis on the market trend for you.
It is the duty of the fund manager to invest your resources on the right investment basket and since a fund manager is professionally trained and has better insights of the market than you are then you are sure that your money will not be waylaid. If you personally handles tha buying, selling of stocks there might be a possibility that you may lose money because aside from you do not have the proper knowledge and insights on the market trend you also are not entirely focused in managing your investment. You might be working in a company for 8 long hours (as in my case) or you are running your own business. With mutual fund you can “leave” your money in the hands of your fund manager and he will do the “growing” in your stead.


WHERE TO INVEST?
Well, there are lots of companies out there that can help you invest in mutual fund.
Personally, I have invested in First Metro Asset Management Inc.. PhilEquity is also a good company as well. There are lots of vehicle out there....search the net or you can email me for more details.

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