Fraud Will Hedge Funds Produce The Next Really Big One

Writen by R W Cuthill Jr

For thousands of years investment advisors have been asking investors to give them money so they could invest it for them. Even after Charles Ponzi in the 1920's, investors have continued to give investment advisors money to invest. The mutual fund industry has been the largest vehicle, but is highly regulated and has produced few frauds. Unregulated investment schemes, such as PONZI schemes and its brother, pyramid schemes, have been the most prolific types of investment fund frauds. Hedge funds could be the next significant vehicle. Hedge funds have gained in popularity to a staggering investment amount of over $2 trillion, according to the SEC. Over 2,400 investment advisors have registered 11,500 hedge funds with the SEC this year.

So why would hedge funds produce the next really big fraud? According to the Association of Certified Fraud Examiners and Financial Accounting Standards Board, the environment for fraud includes three factors, "incentives/pressures, opportunities, and attitude/rationalization." The hedge fund manager certainly has the pressure from his investors to produce results. He also has an unregulated environment to work in producing the opportunity. Additionally the high risk/high reward attitude of the manager makes him more likely to take the risk of defrauding his investors.

A quick review of the SEC litigation releases in the past year shows increased activity against hedge funds, including: altering audited financial statements, concealing losses, creating a fictitious auditor, insider trading, market timing (mutual funds), misappropriation, misrepresentation to investors, non-disclosure to the SEC, and stock manipulation. These frauds were not limited to small or offshore funds, but included funds with hundreds of millions of dollars operating throughout the US. Are these all of the frauds occurring? No, but these are simply the ones which the SEC has litigated against. No one knows in this unregulated environment how many frauds are occurring today.

Since hedge funds are still a popular investment vehicle, how can an investor protect against these frauds? Like any investment, the investor must do due diligence before investing in a fund. The investor should review the funds offering materials, investment objectives, audited financial statements, background of investment advisors and other documentation provided by the fund. He should verify the size of the portfolio with the fund's custodian. He should check the background of the personnel of the investment advisor working on the fund. He should check for regulatory action against the investment advisor and its personnel. He should evaluate the ability of the outside auditor. He should determine who prepares the periodic financial statements provided investors and whether there is third-party oversight. He should determine if the fund has registered with the SEC. He should check with others in the industry that have knowledge about the fund.

After the investment is made the investor's due diligence should not stop. Many of the documented hedge fund frauds have not started in the beginning of the fund, but after the investors became comfortable. The investment advisors continue to be pressured to produce results or lose their investors. The investor should continue to review the reports sent to him by the fund. He should verify the size of the portfolio with the custodian on a periodic basis. He should watch for changes in auditors and other third parties. He should be alert for any regulator action against the fund or its advisors. He should not let the early withdrawal penalties deter him from withdrawing at the first sign of trouble. In most of the documented cases, there is little left, after discovery of the fraud and the litigation to recover from the fraudsters and third parties.

The answer is that some hedge funds are defrauding their investors while they are not more closely regulated. With the increasing popularity and size of some of these unregulated funds, one of these may be the next really big fraud. Don't be the investor caught in it!

Mr. Cuthill's practice is limited to court-appointed positions in large fraud cases. His work has produced the return of millions of dollars of investors' funds. For more information about him go to http://trusteeandexaminerCuthill.com/.

Bond Investments For The Retail Investor

Writen by Michael Russell

Bond markets have been around for almost as long as equity markets. For most retail investors, bonds are seen as less exciting compared to equities, probably due to the relatively stable nature of bond investments. One can probably even argue that media coverage of stock markets is far more extensive than coverage of the bond markets.

So what is a bond? We learn in college that a bond is a debt instrument issued by a company or a government. The buyer of the bond is in effect loaning money to the institution and is promised the full principal plus a fixed periodic payout during the tenure of the bond. The total payouts received together with the final principal will be put together in a computation to determine the yield on the bond. The yield, in layman's terms, is the effective interest rate earned on the bond for the entire duration.

Some issuers issue zero-coupon bonds, which do not have any payout during the bond tenure. The investor earns the difference between the purchase price of the bond and the principal value, also known as the face value.

While investment banking trading desks make profits on trading bonds on a regular basis, by taking on credit risk and interest rate duration risk, this is often not the case for the retail investor, who does not usually have the availability of live interest rate and bond trading data.

A retail investor's objective in purchasing bonds can be seen as an attempt to earn a better yield compared to ordinary deposit rates. If the issuer is sufficiently creditworthy, the investor should be able to receive his or her full principal at maturity of the bond, which can have a tenure of anywhere from three months to fifteen years. At the same time, the investor may have an opportunity to make capital gains from his bond investment if the market interest rates should fall. This therefore presents an additional advantage for bond investments over ordinary deposits.

Trading bonds. The bond market is still largely an over the counter market. Market participants comprise large investment banks, private banks and asset managers. Unlike stocks, which are traded on an exchange and hence have price transparency, bonds traded on the over the counter market do not exhibit this price transparency; quotes are given and taken over a platform such as Bloomberg or Reuters. With the lack of price transparency, there is also a lack of ready liquidity, as one would not be able to determine the liquidity for a particular bond issue. It can be argued that this is one of the reasons why investors are not as familiar with bonds as they are with stocks.

One other way to purchase bonds would be to buy them direct from the issuer, which could be a central bank or a corporation. In most cases, the minimum investment might be higher than what most retail investors are prepared to invest in one go.

With Asian central banks wishing to deepen and further develop the local currency bond markets, greater efforts in education can be seen as key to attracting retail investors towards the bond markets.

Michael Russell Your Independent guide to Investing

Trading Industry Sees Repeat Of May 6 1954 This Thursday Sept 14

Writen by Brian McAboy

An effort by a single person can sometimes change the world.

On May, 1954, Roger Bannister broke the four-minute mile, and in doing so, he removed the barrier that had been in place for decades: the belief that it was not possible for a human to run the mile in under four minutes. The belief had been supported by the medical community with studies and evidence that the human body had physical limitations and that this was all the better humans could do. The claim was further supported by the many efforts of world-class runners that failed. Even the best of the best just couldn't seem to beat the mark.

What had been holding all the runners of the world back was not a physical limitation. It was a mental obstacle that kept everyone from achieving that elusive goal. Because everyone believed that it was impossible, numerous attempts fell short.

In a single day, Roger Bannister opened the minds of people around the world to believe that anything is possible, in spite of substantial evidence to the contrary. Once it had been accomplished, the four-minute mark was soon surpassed by many.

There has been a similar phenomena occuring over decades in the trading industry. The failure rate has been at 90% for new traders, even with the advances of technology and efforts of numerous people to affect that number. Despite the efforts and tools available to traders these days, there has been a barrier just like that of the four-minute mile.

Thousands of traders struggle with the challenge of survival in trading, wondering why they can't seem to make money. Most eventually suffer the "financial death" that is quite common and leaves empty accounts strewn across the markets.

This Thursday is September 14th and marks the First Annual "Improving the Success Rate Day" in the trading world. http://www.september14th2006.com Trading veterans, brokers, and tens of thousands of traders are coming together for the revealing of the obstacle that has held traders back for all these years. The obstacle that traders face is unfortunately not simply a matter of belief. It is a combination of factors that affect the trader mentally and emotionally.

As Trading Veteran Mark McRae has stated, "Too many traders think that the system or method is the be all and end all of trading. There simply isn't enough attention to the psychology of trading and the correct approach that needs to be adopted."

Just like Roger Bannister did for the runners of the world with running, the "Improving the Success Rate Day" is doing for the traders of the world and the trading industry. The barrier, the mental obstacle that is holding everyone back will be revealed.

This Thursday, September 14th, 2006 tens of thousands of traders are going to break through their own four-minute barrier and improve the success rate around the trading world.

Copyright 2006 New Ireland Ventures, LLC

Brian McAboy, The Aspiring Trader's Best Friend. More information on the "Improving the Success Rate Day" can be found at http://www.september14th2006.com

Investing In Car Dealerships How To Value Them

Writen by John Pico

Most business valuations are driven substantially by the company's historical financial statements, tempered by other factors such as: location, brand name, management and such. In truth and in fact, the dealership's balance sheet represents less than half the information necessary to properly value an automobile dealership. The balance sheet is but a starting point from which a number of factors must be added and subtracted in order to determine the true value of the assets.

Valuing new car dealerships has to do with projecting future profits and opportunities based upon the "dynamics" of the particular dealership being valued and of the automobile business itself.

The Internal Revenue Service recognizes that valuations include more than financial statements: "The appraiser must exercise his judgment as to the degree of risk attaching to the business of the corporation which issued the stock, but that judgment must be related to all of the other factors affecting the value." Revenue Ruling 59-60, Section 3.03.

DEFINITION OF MARKET VALUE

The definition of market value according to the American Institute of Real Estate Appraisers' Dictionary of Real Estate Appraisal, is: "The most probable price in cash, terms equivalent to cash, or other precisely revealed terms, for which the appraised property will sell in a competitive market under all conditions requisite to fair sale, with the buyer and seller each acting prudently, knowledgeably, and for self interest, and assuming that neither is under duress." American Institute of Real Estate Appraisers, The Dictionary of Real Estate Appraisal. (Chicago: American Institute of Real Estate Appraisers, 1984), 194 195.

In Revenue Ruling 59-60, the Internal Revenue Service defines "fair market value" as follows: ". . . the price at which the business would change hands between a willing buyer and a willing seller when the former is not under any compulsion to buy and the latter is not under any compulsion to sell, both parties having reasonable knowledge and relevant facts."

The purpose of Revenue Ruling 59-60 is to outline and review in general the approach, methods and factors to be considered in valuing shares of the capital stock of closely held corporations. The methods discussed in the Revenue Ruling apply to the valuation of corporate stocks on which market quotations are either unavailable or are of such scarcity that they do not reflect the fair market value.

The Ruling goes on to state that no set formula can be devised to determine fair market value of closely held stocks and that the value will depend upon such considerations as:

(a) The nature of the business and the history of the enterprise from its inception. (b) The economic outlook in general and the condition and outlook of the specific industry in particular. (c) The book value of the stock and the financial condition of the business. (d) The earnings capacity of the company. (e) The dividend-paying capacity. The ability to pay dividends is often more important than a company's history of distributing cash to shareholders, especially when valuing controlling interests. (f) Whether or not the enterprise has goodwill or other intangible value. (g) Sales of the stock and the size of the block of stock to be valued. (h) The market price of stocks of corporations engaged in the same or a similar line of business having their stocks actively traded in a free and open market, either on an exchange or over-the-counter. With respect to an individual dealership sale, the best comparable is the amount the public company paid or received for buying or selling a similar dealership, not what the public company's stock value or earnings multiple, per se, that is reflected on the stock exchange.

In practice, in arriving at the fair market value of a new car dealership, several different formulas have been used:

1. Return on Investment (or earnings valuation) Formula: The value of a business to a particular purchaser based upon a return on investment analysis. This value varies from purchaser to purchaser according to the purchaser's investment criterion and it may or may not reflect fair market value. The National Automobile Dealers Association (NADA) refers to this value as "Investment Value." A Dealer Guide to Valuing an Automobile Dealership, NADA June 1995, Revised July 2000.

The capitalization rate is determined by the stability of the dealership's earnings and the risk involved in the automobile business at the time of sale, investment, or valuation. This method is highly subjective as the capitalization rate is based upon the particular appraiser's perception of the risk of the business; consequently, the lower the appraiser perceives the risk, the lower will be the capitalization rate and the higher will be the price he would expect a potential purchaser to pay for the business.

In short, the capitalization rate is the appraiser's opinion as to a rate of return on investment that would motivate a prospective purchaser to buy the dealership. Considerations include those specified in Revenue Ruling 59-60, as well as available rate of return on alternative investments.

2. Adjusted Net Worth Formula: Net worth of the company, adjusted to reflect the appraised value of the assets used in the day to day operations of a business, assuming that the user or purchaser will continue to make use of the assets. To this "net worth" value will be added blue sky or goodwill, if any. The "Adjusted Net Worth Formula" is the most common method used in purchasing and selling a new car dealership.

3. Orderly Liquidation Formula. This method values the assets as if all of them had to be sold – not at a "fire sale," but in an orderly manner and without time constraints. Normally, if the dealership is profitable, some value will still be placed upon goodwill.

4. Forced Liquidation. The lowest of all values, forced liquidation means that all of the assets must be sold at a forced sale such as an auction, creditors' sale or by order of a bankruptcy court. A bankruptcy proceeding regarding a new car dealership almost never brings goodwill. This might be the most appropriate formula if the dealership has no lease (or only a short term remaining on its lease) and cannot, as a practical matter, relocate.

5. Income Formula. The income formula is basically taking the store's earnings and multiplying it by an appropriated capitalization rate. The trick here is the definition of "earnings." In determining "earnings" a perspective purchase could use any combination of the following:

(a) current earnings (b) average earnings – add the last five years together and divide by 5 (c) weighted average earnings – usually an inverted weight with the current year multiplied by five, last year by four, the year before last by three, four years ago by two, five years ago by one, then adding them together and dividing by 15 (d) cash flow – net income plus agreed add-backs such as depreciation, LIFO, personal expenses, excess bonuses and such (e) forecasted earnings – future projected earnings discounted to present day value.

6. Fair Value. NADA also refers to a third value in addition to "Market Value" "Investment Value," which it calls "Fair Value." NADA describes "Fair Value" as being ". . . primarily used when a minority shareholder objects to a proposed sale of the company in assessing liquidating damages." and defines it as: "The value of the minority interest immediately before the transaction to which the dissenter objects, excluding any appreciation or depreciation in anticipation of the transaction and without reference to either a minority or non-marketability discount."

The NADA guide states: It is not common for auto dealers to run across this particular valuation standard. This author has never used, nor has ever seen this value used with respect to valuing automobile dealerships. As can be seen in this report, this author in discussing valuations excludes what NADA describes as "Fair Value".

7. The Greater Fool Theory. The National Automobile Dealers Association publication (A Dealer Guide to Valuing an Automobile Dealership, NADA June 1995), bemuses, in part: "A Rule of Thumb is more properly referred to as a 'greater fool theory.' It is not 'valuation theory, however." (In its "Valuing an Automobile Dealership: Update 2004" NADA dropped the reference to "fool" and simply states that the theory is ". . . rarely based upon sound economic or valuation theory," but advises sellers to "Go for it, and maybe someone will be stupid enough to pay [it]."

The considerations for valuing new car dealerships are more complex than those used for valuing most other businesses. Dynamics such as the unique requirements of automobile manufactures and distributors can limit the amount of monies that may be paid for a dealership, regardless of what perspective purchasers may offer to pay for the store.

Therefore, the value of a new car dealership varies based upon the needs and ability of the purchaser and, consequently, the same dealership could have two different values to two different purchaser and both values would be correct.

Thus, our valuation of the subject dealership should be considered in the context and limitations of the facts and history of new car dealership sales as delineated herein.

Although the terms "blue sky" and "goodwill" are sometimes used interchangeably, in our experience they are two separate items.

"Goodwill" reflects the intangible value, over and above the hard assets (net worth) of a going concern, when the business is run profitably. It has to do with the operation of the business. It reflects the fact, for example, that the day the purchaser closes on the purchase of a dealership, customers will be lined-up in the service drive, the dealership's phone number will already be listed in the yellow pages, existing customers will have relations with employees of the store, the back-end (parts and service) will have an established gross profit, and a plethora of other advantages that do not exist with the opening of a "new point."

"Blue Sky", on the other hand, is the intangible value of the business opportunity itself. It is the value, for example of being able to own a particular franchise with a certain retail sales potential, or having a business in particular location, or the fact that a particular franchise or location will complement other franchises or locations of a potential purchaser, or the fact that there are few competitors in the area, or the fact that the franchise is ideal for a certain location.

Examples of pure "blue sky" would be the purchase of a letter of intent (LOI) to establish an heretofore non-existent dealership, or the difference in value between a Subaru franchise in snow country, versus the desert, or the difference in value of a domestic franchise in Flint, Michigan versus Marin, California, or vice-versa, the difference in value of a Nissan store in Marin, California versus Flint Michigan.

In short, "blue sky" may exist whether or not the business is profitable, or even "dormant", as with a LOI. When a store is profitable, however, the distinction still exists, although the term becomes blurred as dealers generally use the terms "blue sky" and "goodwill" as synonymous.

In valuing an automobile dealership, it is common to:

• use the American Institute of Real Estate Appraisers' Dictionary of Real Estate Appraisal and the IRS Revenue Rulings 59-60 definition of "Market Value" and we used the Adjusted Net Worth formula with "Market Value - Continued Used" when valuing the assets;

• use "blue sky" and "goodwill" synonymously, as the dealership is profitable;

• assume an "asset sale" and (1) add the assets of the corporation a buyer would normally purchase to the blue sky and goodwill values to determine a sales value, (2) then add and subtract from/to that value the assets and liabilities that will remain with the seller.

• consider the unique requirements of the industry with respect to the ownership and capitalization of a new car dealership;

• value blue sky/goodwill based upon what the seller could reasonably expect as a sales price, if the seller's interest were actually sold pursuant to the American Institute of Real Estate Appraisers' Dictionary of Real Estate Appraisal definitions of "Market Value", but with regard to what the factory and a lending institution would require to approve the sale and issue a flooring line.

• consider, if appropriate, a minority discount

• land and buildings are valued separately.

Note too: NADA states that in valuing an automobile dealership, "market value" is interchangeable with "fair market value" unless specified otherwise. NADA refers to this value as being used for computation of taxes, divorce, Employee Stock Ownership Plans (ESOP) and shareholder agreements. See: National Automobile Dealers Association (NADA) publication: A Dealer Guide to Valuing an Automobile Dealership, NADA June 1995, and Revised July 2000.

NEW CAR FRANCHISES CANNOT BE SOLD

The term "sale" of a new car franchise is a misnomer, in that a new car dealership franchise cannot be sold. Each and every factory and distributor issues a contract called a "Dealer Service and Sales Agreement" which is entered into between the dealer and the factory and which agreement specifically states the franchise cannot be sold.

What actually occurs in the "sale" of an automobile dealership is that the parties sign a Purchase Agreement with respect to dealership assets or stock and give the Agreement to the factory for factory approval of a number of approvals that must be obtained before the sale can be consummated and the purchaser appointed as the seller's successor dealer. These approvals include:

(1) the purchaser's character; (2) the operator's experience; (3) the dealership's location, with respect to current demographics; (4) the adequacy of the facility, with respect to current planning volume; (5) the dealership's capitalization; (6) the dealership's projected viability as a profitable entity; and (7) the investor's source of funds

Consequently, the fact that a particular prospective purchaser has "the highest offer" does not mean that a dealership can be (1) sold to that prospect or (2) that the dealership has the value offered. A new car dealership may only be sold to a candidate that meets all of the qualifications of the manufacturer and distributor with respect to capital, experience and projected viability. Although many courts, especially bankruptcy courts have attempted to ignore this rule and value the dealership at the value placed upon it by the highest bidder, the fact that the highest bid does not establish the value of a new car dealership has been upheld by state and federal appellate courts in every jurisdiction in the United States, including bankruptcy court.

See: In re Pioneer Ford Sales, Inc., 729 F.2d 27 (1984), where the Bankruptcy Court, 26 B.R. 116, had approved the transfer, which ran from Pioneer to Pioneer's principal secured creditor, to Toyota Village. The Court of Appeals reversed both the bankruptcy court and the district court finding that Ford's disapproval was not unreasonable. See too: Ferrari v Simms, US Ninth Circuit Court of Appeals, Case No: 9916059, April 27, 2000, wherein: the US Bankruptcy Court approved the sale of a bankrupt Ferrari dealership and Court of Appeals reversed stating: the manufacturer ". . . did not unreasonably withhold its consent."

Thomas M. Pitegoff, in his article: Franchise Relationship Laws: A Minefield for Franchisors, THE BUSINESS LAWYER, Vol. 45, No. 1, November 1989, states at page 289. "A franchisor at common law and under the Sherman Act may also withhold consent to a transfer on the basis that the price at which the franchisee is offering to sell the franchise is so high that it would jeopardize the financial stability of the business and hinder the transferee's ability to succeed.

It is well established that the franchisor has an interest in ensuring that the purchaser will have a chance to realize a reasonable return on his investment." See: In re Beverage International, Ltd., [1986-1987 Transfer Binder] Bus. Franchise Guide (CCH) ЂЂ 8636 (Bankr. D. Mass. 1986); Walner v. Baskin-Robbins, 514 F.Supp. 1029 (D. Tex. 1981); Hawkins v. Holiday Inns, 634 F.2d 342 (6th Cir. 1980), cert. denied, 451 U.S. 987 (1981); Kestenbaum v. Falstaff Brewing Corp., 514 F.2d 690 (5th Cir. 1975), cert denied, 424 U.S. 943 (1976); Hanigan v. Wheeler, 504 P.2d 972 (Ariz. 1972).

REAL PROPERTY AND FACILITIES

Insofar as the operations of a new car dealership are concerned, a factory/distributor will not approve the "sale" of the dealership without passing upon: (1) the condition of the physical facility; (2) the rent factor; and (3) the lease. Furthermore, the value of real property and facilities to a manufacturer and to a new car dealership does not necessarily relate to the market value of land and buildings in the market area. See: John Pico "Buying and Selling Automobile Dealerships", National Legal Publishing Company (1986). There are "per car" rental factor and percentage of sales formulas used to determine whether or not a dealership could even survive servicing a proposed rent factor.

Additionally, unless there are extenuating circumstances (such an anticipated move in location), manufacturers and distributors generally will not approve a sale without a candidate securing at least a five year lease on the dealership on an "approved" facility. In some instance, the prospective purchaser's problem with relocating could be that the state has a mileage law.

CURRENT STATE OF THE DEALERSHIP ECONOMY

There are three major factors to consider when discussing "the economy": (1) The health of the national economy; (2) The health of the local economy; and (3) The fiscal health of the franchise and its dealers.

IMPORTANCE OF LOCATION

The strategic importance of location in valuing a dealership, especially this dealership, cannot be overstated. Michelle Krebs and Donna Harris, Staff Reporters for Automotive News, wrote an article on January 21, 2002, detailing the importance of a dealership's location stating that location, always an important asset, has become even more so in valuing a dealership. See too: Dealer Magazine, June 2000, "Defining Blue Sky"; Beers and Cutler, (beersandcutler.com), "Auto Dealer Report", Issue 2, 2001; and MerillLynch, in its April 19, 2004 report on Auto Dealers wrote:

THE CONDITION OF THE FACILITY

See the Donna Harris' Automotive News article of January 27, 2003 entitled: "Showroom renewal", wherein she states "More makers than ever want dealers to remodel their stores." She quotes Lou Porreco, president of five dealerships in Pennsylvania and Florida, is at the top of the district in customer satisfaction and sales volume: "When there is a buy-sell agreement, and a new dealer is coming in or a dealer is getting a new franchise or a dealer wants to relocate, the factory makes it contingent on remodeling."

See too: Michael Bradford's February 4, 2004 Automotive News Article entitled: "Dealers Respond – Redesigns", whose investigative reporting reached the same conclusion.

ONE MAN SHOWS

Revenue Ruling 59-60, Section 4.02 (b) states: "A sound appraisal of a closely held stock must consider . . . The loss of the manager of a so-called 'one-man' business may have a depressing effect upon the value of the stock . . . In valuing the stock of this type of business, therefore, the effect of the loss of the manager on the future expectancy of the business, and the absence of management-succession potentialities are pertinent factors to be taken into consideration."

POTENTIAL PURCHASERS

Public Companies

At this time, public companies are no longer the darlings of the industry and as a rule are no longer spending huge sums remodeling dealership facilities they once were and many manufacturers and distributors are rejecting offers by public companies to purchase their dealerships. For example, in 2005 Ford Motor Company refused to approve a public company's $87 million offer for the a Dealership Group. The rejection was upheld by both the California New Car Dealer Board and the state courts. In 2005 Mercedes-Benz blocked another public company from purchasing one of its dealerships by exercising its right of first refusal. In the same time span, Ford Motor Company repurchased yet another public company's Ford dealership and turned it into a company store.

In addition, manufacturers and distributors have limited public companies to a specific number of franchises they may own (for example, Lexus only allows a company to own a combined total five Lexus dealerships in the entire United States) and they have implemented rules prohibiting companies from owning dealerships in the same market.

COMPARABLE DEALERSHIP SALES

Comparable sales are relevant to the extent that the stores being sold are truly "comparable" to the dealership being valued, with respect to potential, facility, location, brand, demographics, and so forth. As no two stores are truly identical, the blue sky paid for each "comparable" store would need to be adjusted for the each of the factors mentioned in this article in order to accurately reflect a "comparable" value.

John Pico has a Doctorate in Jurisprudence and is a vice president of Automotive Advisors. He has completed over 1,000 dealership transactions and published the first books copyrighted in the Library of Congress on Buying and Selling Automobile dealerships. You can obtain his biography and more information, sources and references at http://www.automotiveadvisors.com/johnpico.asp

Brazils Stronger Balance Sheet

Writen by Carl Delfeld

Brazil's booming stock market has caught foreign investor's attention but the question still lurks in the background like an uninvited guest - is this just another leg in the typical boom and bust cycle?

For the answer, take a look at Brazil's improving balance sheet. While America piles on the debt, Brazil is going the other way. It decided last December to pay off its remaining $15.5 billion debt with the International Monetary Fund (that must be a relief!) and announced just last week that it will retire all of its remaining $6.6 billion worth of Brady bonds issued during the early 1990's financial crisis

Where is the money coming from? Brazil recorded trade surpluses in 2004 and 2005 with exports for the last twelve months hitting a record $120 billion. Exports of oil, soybeans, copper, steel, autos, sugar and coffee are surging even in the face of a strengthening currency. The Brazilian real is up 52% against the US dollar since May 2004 and up 22% during 2005. Brazil is almost energy independent and foreign exchange reserves are now $58 billion even after paying off the nettlesome IMF debt.

Behind all these positive numbers are substantial reforms begun by President Cardosa and continued by Luiz Inacio "Lula" da Silva. Payroll taxes and corporate taxes have been cut, the tax system simplified and last week Brazil announced that it would eliminate the income tax for foreigners that purchase public debt. Brazil's strong currency will likely also lead to a loosening of foreign exchange restrictions.

A cynical friend of mine often comments that successful political leaders need to ignore their strongest supporters if they are to achieve real reform. If so, Lula is a good example since most expected him to reverse market reforms after taking power in 2002 while in fact he deepened them. Up for re-election in October, Lula has nevertheless delivered higher living standards and restored national pride. With 187 million people and an area only slightly smaller than the United States, this leading South American economic power together with Chile and Colombia are changing attitudes toward the region as a whole.

What's the best way to bet on Brazil's momentum and improving balance sheet. I had been recommending the Brazil iShare (EWZ) which is up 27% this year and 72% in the last 12 months. In June of last year I switched to the S&P Latin America 40 iShare (ILO) that gives you broader exposure with 50% exposure to Brazil, 38% to Mexico, 9% to Chile and 3% to Argentina. This ETF is up 18% this year and 69% over the last year.

One ADR to take a look at is wireless provider that has been on a tear America Movil (AMX) and a safer option is Colgate Palmolive which derives roughly 20% of its sales from Latin American markets.

How important is the October election to Brazil? Even with all the economic growth, lower debt, lower taxes, booming exports and strong currency, public sector debt is still 51% of GDP so continued progress is essential. Like the old saw goes, even if you are on the right track, if you're not moving you will could get run over.

Sydney and Tokyo and served on the Executive Board of the Asian Development Bank in Manila. He was also a consultant to the U.S. Treasury and the U.S. Congress on international investing and is a columnist on global investing for Forbes Asia magazine.

For more information about Chartwell's ETF investor advisory services, please go to http://chartwelladvisor.com/etf_investing.html or call Carl Delfeld direct at (719) 264-1503.

Finding A Good Online Investment Company

Writen by John Mussi

When looking at your options for investing online, you might be overwhelmed with the prospects that present themselves. Internet searches will yield pages upon pages of potential online investment companies, and you might not know exactly how to go about finding the right one for your personal needs.

The search for a reliable online investment service doesn't have to be a difficult one, however… taking the time to decide exactly what you're looking for and comparing your search results according to those criteria can make it easy to find the best online investment website for your needs.

Searching for an Online Investment Company

The best way to begin your search for an online investment company is to perform a web search via your preferred search engine. You'll likely get several pages worth of results, though the first page or two will likely be where you'll find your best bets… beyond that the results begin to get less relevant in regards to your search parameters.

There's a good chance that you'll recognize at least some of the names of the companies on the first page of results… the top-ranked results will likely be the ones that advertise themselves online, in television commercials, and even in print mailings and radio ads.

You should look at several of the well-known websites, as well as some of those that you've never heard of… after all, just because a site is well-known doesn't mean that it will offer what you're looking for.

Type of Investments that You Want to Make

The main thing that you should consider when comparing the different sites is the type of investments that you're wanting to make.

Sites that offer a large number of investment options will likely be more confusing for you if you simply want to purchase certain basic stocks, and sites with only investment plans won't do you much good if you're only wanting to make investments occasionally when you have the money to spare.

Consider what you want to do, and look at the options that present themselves to see which is most likely to help you achieve your goals.

Other Criteria

In addition to considering the type of investments you're wanting to make, you need to also think about a few other things when choosing an online investment company. Some websites require a minimum initial investment that may be more than you're wanting to invest at one time, and others require that you open a cheque or savings account with the bank that they're associated with at the time that you open the investment account.

You also should look into the brokerage fees that the site charges for both purchases and sales (since purchases are usually less expensive than sales are), and any other fees that they might charge.

Another consideration is whether the site will automatically reinvest any dividends that your investments pay, or if they will be held in a money market account until you decide to invest or withdraw them yourself.

What to Avoid

Generally, you should be wary of any online investment firm that requires a specific amount of activity or charges any excessive fees or membership fees for their services.

You should also avoid doing business with any online investment firm that limits your accessibility to your investments or that requires any sort of waiting period on purchases or sales.

Since investments can fluctuate, you should have full access to invested amounts and the values of them… any site that doesn't provide these basic services isn't worth your time.

You may freely reprint this article provided the following author's biography (including the live URL link) remains intact.

John Mussi is the founder of Direct Online Loans who help homeowners find the best available loans via the http://www.directonlineloans.co.uk website.

Hyip Really Paying Does It Really Exist Good News

Writen by Eureka Phi

WHY SHOULD YOU INVEST WITH HYIPs ?

Some of them:

- are really reliable and professionals and are paying.

- have been operating since 1998 and are one of the oldest programs online.

- are a real, legally registered companies with full contact info.

- prooves that Over 25,000 investors world-wide have already joined some of them and invested over $23M

- are DDoS-protected by a professional anti-DDoS protection provider. This guarantees almost 100% uptime at all times and under any circumstances.

- If you are a serious investor, they can offer you a chance to earn even more than 3% daily.

- If you are a referrer you will receive your 5% on time. They have never deceived anyone.

- Private investment groups (at the moment over 50 groups) from all over the world invest with some of them.

- do not vanish after you invest your $100,000.00 unlike most other HYIPs.

- You will really become wealthier with these ones.

- Thousands of people all over the world have obtained financial freedom with them. Some of them have even given up their jobs - They are their source of income.

- They are rated at the top on all major ratings of the world.

Stop losing your money, start trusting professionals. Contact us by email with subject "reliable link" at eureka_phi@yahoo.com

We give the opportunity to visit and test a reliable link.

Reliable Internet worker

Increasing The Bottom Line With Your Options

Writen by Erik Schouman

You are the proud owner of a web site that is experiencing some success, yet you still haven't achieved the golden chest of web site revenue. Consider increasing your revenue stream by trying a creative approach. With a modest investment this steam of revenue does not require the use of new software, website tools, or a blasting search engine service.

They fuel your future profits by being placed in your option trading account. Perhaps you think you know your stock trading activities from your options. Here we do not use the stock market for your options. We use the futures contracts of the vast commodities markets of this country instead of stock options.

You can best think of options trading as a side business working in conjunction with your online business. Using this options account enables you place trades with several markets such as corn, pork bellies, soybeans, gold or the S & P 500 index.

For your options trading account to be set up you will need an online trading broker who handles your trades and forwards them to the one who handles the commodities you trade. Don't ask your broker for advice since the large majority don't know any more than you which way the market is going today. It is best to work with a broker who allows you to do your trading online without assistance, and doesn't charge unreasonable commissions on you trades.

Use wire transfers, a cashiers check, or as a last resort your personal check to fund your trading account. Once your account is open you may begin to use your online trading broker, but before you start trading do a little research. This is widely available and will serve you well.

Article space does not provide me the time to discuss this aspect of your new side line business. Don't let this discourage you. Just go online where you will find many excellent sources of information on this topic.

Stock market trading, and futures market trading moves at a faster pace than the options trading. This slower pace has the advantage of being more manageable. This will prevent the knee jerk syndrome people have when a futures market moves against them too rapidly.

After your options business is up and running with some trades placed it almost works on its own. All this takes very little time, unless you peak an interest. Then time is all up to you in keeping up with your future markets.

Trade carefully and conservatively and you will benefit from your options trading.

Thanks for reading. If you found this article helpful you can get more options trading information, tips, and more articles on my website: http://www.learningoptionstrading.com

You Cant Beat The Market

Writen by Thomas Mullooly

...unless the stocks you own ARE beating the market!

There is no way on earth you could ever beat the market if the stocks you hold are not keeping up with the market. And hopefully, staying ahead of the market.

But yet, that's what lots of people try to do. They'd rather keep all the dogs in their account and maybe "take a flyer" on one stock, hoping for a miracle. It's like trying to win a NASCAR race with your Ford Taurus. It just ain't gonna happen.

But hey, maybe you don't want to beat the market overall. Maybe you just want to own the BEST semiconductor stocks, or the best retailers, or the best utilities.

Seriously, how would you even KNOW if your stocks or mutual funds are beating the market, or are the best names to own in their group? Well, I can tell you this...

the best indicator I've ever seen in twenty-plus years in the business has been relative strength.

What is relative strength? It is simply the measure of how your mutual fund or stock is doing, compared to a group of other stocks, funds or indexes...or the market overall.

Perhaps you want to compare Intel with other semiconductor stocks. Maybe you want to compare Microsoft with the S&P 500 Index. Maybe you want to compare your mutual fund against the Dow Jones Industrial Average or the Standard & Poor's 500 Index.

This is a very easy calculation. Here is how you do it: Simply divide the price of your stock or mutual fund against whatever yardstick you choose. You'll get a fractional number as the result. But slide the decimal over so you can work with whole numbers. Then we begin plotting that result daily on a point & figure chart.

These relative strength charts move much slower than a typical chart. Anything going up over time will be in a column of X's. Anything going down will be in a column of O's. If you want to significantly improve your chances of beating the market, the index (or whatever yardstick you choose), it MUST be in a column of X's and preferably be giving buy signals.

Why is this so? Well, if your stock or mutual fund is climbing in a column of X's against the market (or a group of its peers), it HAS to be outperforming the yardstick, right? It cannot go higher unless it is rising faster than the market overall.

Now, if your stock or mutual fund is going down against the yardstick you are using, it means your stock or mutual fund has poor relative strength compared to the index you are plotting it against.

Poor relative strength is something to be avoided.

Here's why: When the market starts falling apart and things look bad, stocks and mutual funds with poor relative strength (or on a relative strength SELL signal) will usually fall further, faster than the rest of the market.

Now, stocks on a relative strength BUY signal can also fall with the market. But our experience has shown that stocks with good relative strength (or on relative strength buy signals) usually don't fall as far as the market overall. They are also are the first names to bounce when the market recovers.

Thomas Mullooly, President of Mullooly Asset Management, works one on one with individuals so they can regain control of their investments. Tom's popular email alerts help folks to reduce the risks in their portfolios. To learn how to stop making simple investing mistakes and to sign up for Tom's email alerts, visit http://www.mullooly.net, today!

Technical Analysis Explained

Writen by Jon Lynch

Technical analysis is the study of price action over time and charts are what an analyst works with as their primary record of price action. Behind every price is an investor who had a reason for buying or selling. Traders generally act alone but often their weight of numbers has a direct influence on short term prices.

Analysing the market with charts and technical indicators is the study of group behaviour and sentiment. It is done with science and art. We use science because we use mathematical formula, computers and statistics. The art is creating a trading model with technical indicators and money management principles that reflect the investor's personality and trading philosophy.

Charting is the study of price action of a market itself as opposed to the study of the goods in which a market deals. Technical analysis is simply a different means of endeavouring to arrive at the same investment objectives. These goals may be summarised as:

* To gauge the relative strength of buyers and sellers

* To identify preferred times to buy and sell

* To develop a theory as to how far price may reasonably be expected to move

* To formulate a risk strategy.

Such analysis is particularly useful to short term investors as it assists in timing the placement of positions and helps to optimise the deployment of capital.

Technical Analysis Principles

The analyst attempts to use market history for its predictive value to control positions and to anticipate probable price movements in the future.

Three basic premises serve as the basis of analysis:

* First, market prices follow trends. That is, the flow of prices is not merely a series of random events.

* Secondly, as a random group, participants in the marketplace have responded one specific way at a given price.

* The third principle also relates to the past. History does repeat itself, and it does so often.

Jon Lynch is Marketing Manager of the Capital Intelligence Group of companies, including HomeTrader - Australia's leading stock market education centres. We focus on teaching you how to create wealth through the share/stock market using a customised trading plan or system that is right for you, your situation and your goals. Visit our website and register for your free introductory DVD "Learn To Make Money On The Stock Market" at http://www.learnshares.com.au

The Truth About Real Estate Investing Is It Right For You

Writen by Dr. Scott Brown, Ph.D.

You have probably been hearing, seeing and reading that real estate investing is the best thing since sliced bread. There are many late night cable television infomercials spewing out sales pitches for courses that teach you how to buy residential real estate no money down or for next to nothing. Furthermore, polished pitch men on the advertisement emphasize that it is so easy that anybody can do it. They smugly show you that it is simple as they pencil out on the back of a napkin how you will supposedly make a fortune in real estate. Then these real estate investment course promoters show "actual" interviews of people who have reportedly made gobs of money with the course system.

Although it is true that fortunes can be made in real estate it is actually more likely that it will be the guru owner of the real estate course than you! The reason is that real estate investing is a lot harder than most people realize. When you buy, rent, and sell real estate as opposed to stocks you are dealing directly with people and there is not organized exchange to keep things standardized. Don't forget that courts see it as their duty to protect the shelter of families even if they are non paying renters who are total deadbeats. Another problem is that many contractors who do odd fix up jobs for real estate rehabbers are drifters with as many personal and financial problems as bad tenants. They damage houses and are down the street as soon as they get a little cash out of the hapless real estate investor.

It also takes many years to learn how to properly assess value in a town or neighborhood and get the required experience in real estate closings to not have the big profits you initially think you see in a deal leak out. The key point of this edition of the "Wallet Doctor" is that real estate investing is a business. Like any other business it requires constant dedication and education. If you work full time it means losing your free time to your rentals and rehabs. If a property doesn't sell or if the tenant doesn't pay you will have to lose part of your salary to cover the mortgage. You should enjoy your regular full time job because you selected it. If you prefer cookouts and trips to the beach over collecting rent and repairing your residential real estate investment then the stock market is a better place for you.

ABOUT THE AUTHOR: Dr. Scott Brown, Ph.D., a.k.a. "The Wallet Doctor", is a successful futures trader, real estate investor, and stock investor. Dr. Brown holds a Ph.D. in finance from the University of South Carolina. His 1998 articles in Technical Analysis of Stocks and Commodities were prophetic in predicting an impending stock market crash. He has helped many people become profitable investors by teaching them to look out over many years to spot stocks that are low and primed for rise in the new bull market. His second article met with approval by Dr. Bob Shiller of Yale University. Dr. Shiller is the economist that Alan Greenspan most highly regards who coined the term "Irrational Exuberance." In 1998 he shouted to the world to "get out" of the stock market but now he is shouting to everyone that it is time to "get in!" The Wallet Doctor is not only sought after for investment advice and coaching in stock investing but also in futures trading and real estate investing.

Visit Dr. Brown's site at http://www.BonanzaBase.com or sign up for his investment tips at http://www.WalletDoctor.com

Property Investment Advice

Writen by Moutushi Banerjee

As we are looking for ways to secure our financial future instead of relying on stocks and shares or the government to secure us during old age, property investment has gradually been accepted as the best way.

Investments made in stocks or funds often fail to perform whereas rarely has careful investments into property left you a loser. No wonder why more and more people are interested in building a profitable property portfolio.

Property investors generally follow the following rules when looking for property to resell or rent out for profit.

Talk to agents and never forget to do your own research. Get an idea of the rent you possibly will earn from the property. Buy to let mortgages are usually based on the rent accounting for 125-130% of the monthly mortgage payment, so it pays to make sure of your figures.

Never commit your full personal wealth to invest. Instead look for loans, mortgages, and credits to invest in that property. Keep your wealth with you.

If you have an area whose future is expected to be bright, look for an area, which is already potential, the property already profitable. Better to invest in property, which is already certain to yield results rather than speculate and invest in yet to be potential ones.

Do not get emotionally attached with the property. Your investment is business for you.

Let property unfurnished. That will keep you free to fixing the furnished items. Only pay for property upkeep and nothing else.

If you plan to renovate or refurbish, do it only if you can sell the property for profit. Unless you know people in the trade who can help you with it, consider rental to make money.

Learn all you can from the published documents, books, and magazines and gather the knowledge. You can profit from the wisdom of the property investors and real estate millionaires who publish the books.

Get all information hands on. Visit letting agents; look at property prices, rentals, and the area. Invest only when you are certain that the property of your choice and the location can earn you profits.

Do your own homework, keep track of the changes and do not be swayed by others who say your investment might not work. Dreams come true, but you need to take the calculated risk. Profits are hard to come, but never unachievable. Keep yourself away from negativity of others.

With your financials always undervalue your returns and overvalue your investment. Your practical and careful budgeting will be rewarded.

http://www.midasestates.com/property_investment_advice.php

Vertical Spreads Vertical Call Spread And Vertical Put Spread Value

Writen by Ron Ianieri

Any spread that has intrinsic value is considered in-the-money.
How can you identify the value of a vertical call spread or a
vertical put spread? Compare the stock price to the strike
prices.

Look at any vertical call spread. If the stock price is above
the lower strike of the spread, then the spread is in-the-money.
For example, in the Feb. 50 – 55 call spread, if the stock is
trading at $52.00, then the spread would be in-the-money by $2.
This is because if the spread expired today, the Feb. 50 calls
would finish $2.00 in-the-money. The Feb. 55 calls would finish
worthless because they are out-of-the-money. The spread,
however, would be in-the-money with a value of $2.00.

The rule is similar for determining whether or not a spread is
out-of-the-money. If the stock price is lower then the lower
strike of the spread, then the spread is out-of-the-money.
Again, looking at the Feb. 50 – 55 call spread, if the spread
expired today and the stock price closed at $48.00, (lower than
the lower strike) then the spread would be out-of-the-money,
thus the spread will be out-of-the-money. And, of course, if the
stock is trading at the same price as the lower strike price,
then the spread will be considered at-the-money.

For vertical put spreads, a spread is determined to be
in-the-money if the stock price is lower than the higher of the
two strikes of the spread. For example, let's look at the Sept.
40 – 45 put spread. If the stock were to close at $42.00 on
expiration day, the Feb. 45 put would end up in-the-money and
worth $3.00. The Feb 40 puts would be out-of-the-money creating
a $3.00 intrinsic value for the spread. Since the spread has an
intrinsic value, it is in-the-money.

A vertical put spread is considered to be out-of-the-money if
the stock price is higher than the higher strike of the spread.
So, going back to our Sept. 40 – 45 put spread example, if the
stock was to close at a price of $46.00 (higher than the higher
strike) then both the Sept. 40 and 45 put will expire worthless.
Thus the spread will be worthless and out-of-the-money.

A vertical put spread is considered at-the-money when the stock
price is equal to the higher strike price.

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Gold Is Where Yo Find It

Writen by Al Thomas

There are many ways to own gold, many forms: jewelry, bullion, coins, mutual funds, gold mining stocks (indirectly) and ETFs (Exchange Traded Funds). The latter are similar to mini mutual funds, but usually have few stocks and they remain constant rather than have internal trading as mutual funds do. So you can own gold. So what? Why bother when it does not pay any interest or pay any dividends? What is interesting to note that one ounce of gold today will buy the same amount of goods as it did 100 years ago. That item in 1906 might have been $1.00 and today the same item would be priced at $100, but when translated into ounces of gold the weight is the same.

Doesn't that make you wonder? That is inflation at work. Gold is inflation proof. Man has had an ongoing love affair with gold since time began. Every culture has valued it.

Columbus didn't set out to find America. He came looking for gold.

Gold is the only real store of wealth not the paper we call money. Dollars have depreciated about 50% in value over the past 18 years. It is hard to realize as it sneaks up on us that each day that our dollars are worth less in purchasing power. Wealth is purchasing power.

The Federal government prints money that has no backing other than their word. Each dollar is watered down as the printing presses turn. Every war is financed with paper money not gold. If wars were financed with gold there would be fewer wars.

People were not interested in California. It was too far and too hard to get to, but when the cry of 'gold' went up thousands made the journey to strike it rich. One enterprising man in San Francisco found out about the strike and did not head for the American River to pan for riches. He bought up every pan, pick and shovel in town and them went out to spread the word. The pans he paid 15 cents for he resold for $15. In a week he made $36,000. In those days that was big, big money.

Without gold I don't think there would be an American California today as it was claimed by Mexico.

Alaska is another territory that brought the dreamers and schemers because of the lure of gold. Good digs were uncovered in 1949 and more in 1914. Thousands came to remain and settle this seemingly desolate country.

Men continue to search the planet for this elusive golden maiden. Very few find it. Others become entrepreneurs who make their fortune from the gold seekers.

How you seek your wealth is an individual choice, but the wise ones who do strike it rich convert some of the new found riches into the golden metal to protect their wealth from the attrition of inflation.

Al Thomas' book, "If It Doesn't Go Up, Don't Buy It!" has helped thousands of people make money and keep their profits with his simple 2-step method. Read the first chapter at http://www.mutualfundmagic.com and discover why he's the man that Wall Street does not want you to know. Copyright 2006 All rights reserved.

Spx Comparisons Of 1994 And 2006

Writen by Arthur Eckart

Currently, there's uncertainty if the economy will fall into recession within a year (e.g. given some of the previous money supply tightenings are in the "pipeline," and the flattening of the yield curve). In 1994-95, the Federal Reserve achieved a "soft-landing," and may avert another recession in the current period.

The first chart is an SPX 1993-94 daily chart that shows a top in Feburary '94, a 9.7% fall in two-months, and then a general uptrend. The second chart is an SPX current daily chart that shows a top three-months ago. The vertical line in the first chart is where SPX was three-months after the '94 top.

There are some crude similarites between the two charts, including falling to bottoms quickly, making higher highs and higher lows, and the 50-day MAs falling below the 200-day MAs. The two arrows, in the first chart, indicate a more sustainable rally above the 50-day MA, which began to rise. Consequently, it's uncertain if SPX is currently in a similar uptrend.

The third chart shows intermediate-term technical indicators remain bullish (the CPC 50-day MA, i.e. Put/Call above chart, is particularly bullish, because it peaked at 1.08, which is an all-time high). However, short-term technical indicators are overbought. SPX 1,261 is key support, i.e. breakout point of mid-July high, middle of daily Bollinger Band, and rising 50-day MA. SPX resistance is around 1,290, i.e. June high.

If the FOMC pauses Tuesday, that may ignite a rally, perhaps to around 1,290. However, it may be short-lived, because of concerns about a contracting housing market contributing to higher unemployment, lower consumption, and accelerating inflation (since rents are rising). Also, oil prices remain high. If the Fed tightens, a steep market fall may take place. Consequently, volatility may continue.

Free charts available at http://www.peaktrader.com Forum Index Market Forecast category.

Arthur Albert Eckart is the founder and owner of PeakTrader. Arthur has worked for commercial banks, e.g. Wells Fargo, Banc One, and First Commerce Technologies, during the 1980s and 1990s. He has also worked for Janus Funds from 1999-00. Arthur Eckart has a BA & MA in Economics from the University of Colorado. He has worked on options portfolio optimization since 1998. Mr Eckart has developed a comprehensive trading methodology using economics, portfolio optimization, and technical analysis to maximize return and minimize risk at the same time and over time. This methodology has resulted in excellent returns with low risk over the past four years.

Present Value Of Future Payments

Writen by Kevin Stith

Studies have revealed that a number of people prefer to cash in on their future payments rather than wait for monthly installments. This growing trend is attributed to two major factors. Firstly future payment owners may need a lump sum to fund immediate needs. Others have gone a step further by determining the present value of future payments. People consider that immediate realization of cash from future payments compensates the diminishing effects of inflation on the present value of a future payment.

In simple terms, present value of future payments refers to their actual worth today. At times the present value of future payments tends to be notably higher than the expected value of future payments. The concept of future payments is simple to understand. Insurance or liable companies pay a monthly payment to the bearer. The payments made are actually realized from interests earned through annuities by these companies.

In most cases, these future payments are purchased for a lesser value than the actual settlement amount by paying companies. People therefore are actually receiving a discounted percentage of the settlement over a period of time. In due course of time these equal monthly payments will be of a diminished value. There are many variables involved.

If a person decides to cash in on future payments, the present value of future payments is based on a few factors. These include rating of the insurance company making future payments, the amount that is still payable, period for which future payments are structured and the amount the buying company will deduct for its service charge. Present value of future payments is greater than, when structured over a period of time.

Payments that are due are basically interest that has not been earned yet. When a case is settled, at times the insurance company invests the settlement amount in an annuity. This funds monthly payments, which is a combination of principal and interest. It is for this present value factor that insurance companies pay in installments rather than pay the whole amount. This makes the insurance companies the most profitable in a settlement case.

Sell Future Payments provides detailed information on Buy Future Payments, Cash For Future Payments, How to Sell Structured Settlements, Present Value of Future Payments and more. Sell Future Payments is affiliated with CD Rate Calculators.

Learn To Like Your Losses

Writen by Larry Potter

Sounds almost morbid doesn't it?

Well, maybe it is....but losses are a fact of life and your ability to take them systematically without fault is key to your long term success.

You see, every system ever designed and traded has suffered losing trades and most have had several losing trades in a row. Even short term systems that purport a high percentage of winners will hit periods of 3-4-5 losses in a row.

If you stop taking the signals, then your gauranteed to lose and never get back your money. Ironically, after a losing streak, is when a system will normally bank a series of winners or the one big profit trade.

So the next time you find yourself mired in a drawdown, take some satisfaction in knowing that losing periods happen to everyone and that if you stay disciplined, your method will most likely carry you through it. Realize that the pressure you feel to quit, is the pressure that every trader feels at some point and it's how you handle that pressure that defines your ultimate success. Winners trade through it and losers don't, it's just that simple in most cases.

Now please, the above discussion is based on the assumption you have a sound trading method and you implement proper risk management. If you don't have those two variables nailed down, all the persistence in the world will not help you.

Larry Potter is a recognized authority on the subject of trading and has been publishing his newsletter, Stocks2Watch®, since January of 1998. For More Free Trading Tips, go to: http://stock-trading-tips-short-term.blogspot.com

Wall Street To Main Street News Views And Commentary June 8 2006

Writen by Louis Victor

It's Thursday June 8, 2006, and the downward trend continues, as we are over the hump of the trading week and the Dow and Nasdaq are still seeing red. But before we head into the world of stocks lets stop on the political front.

President Bush said on Wednesday that all immigrants must learn English, this is a new proposal that he is pushing and looks to gain passage during this midterm election year, but he will have a long road ahead of him as he not only has to win over the Democrats but also members of his own party.

There was a surprise guest on Capitol Hill and that was the founder of Google (NASDAQ: GOOG) Sergey Brin. This trip was an important one as for the first time the company has admitted to compromising their principles when they agreed to censor the Chinese version of Google. He stated that they reluctantly agreed to the censorship once the Chinese Government blocked Google's Chinese version site.

As we are in the heat of midterm elections the topic of gay marriage has popped up again, but is it just at the wrong time. The Senate rejected a gay marriage ban stating that both President Bush and the GOP's lobbying for this passage was out of line. But because this is midterm election time you can expect this to topic to come back to life next month with more fuel on the fire than before.

Now, I'm going to say it again, as an investor you should not, better yet cannot get emotional. Stocks trade up, stocks trade down, and that is the nature of the stock market. It's your job to do the homework that will put you on the right side of the movement. We will continue to lay out some ideas and our outlook, we'll give you some insight into the company and its current situation but you still need to do your homework to insure that it is right for you. We want our readers/listeners to be well informed so that you can make informed decisions and not foolish trading mistakes.

So do not trade with emotion, use your head and focus on the game plan, now lets move on to some stocks that you will want to keep an eye on.

The NAMC Newswire's "Wall Street to Main Street" segment in its entirety is only available to subscribers. Don't miss out and Keep in mind that all subscriptions are free and will remain that way. All that you need to do is go to www.namcnewswire.com and add your email address to receive the full segments. We value your privacy and all email addresses are only used for NAMC related items and not shared with any third parties. Your subscription allows you to participate in the newly added investor commentary; this is where we will be giving the floor to investors each day.

Remember that investor commentary segment is wide open, so send us your emails using our contact form on www.namcnewswire.com and give us a call toll free at 888-463-9237 between the hours of 6:30pm and 12am EST weekdays to get involved. Make sure to include your name and state in the email or in the audio. We want to hear from you so make "Wall Street to Main Street" work for you.

Be sure to spread the word about "Wall Street to Main Street" as we continue to grow both the daily segment and the radio show, so do your part to help us expand our reach.

Remember that you can always listen to the NAMC Radio on Streetiq.com, the leader in financial podcast. www.streetiq.com and is also available on iTunes.

Movers and Shakers

Some major movers in yesterdays trading session include Intuitive Surgical (NASDAQ: ISRG) which was knocked down from $116.35 to $107.70 on Tuesday but regained those loses to trade up $4.95 to close at $113.01 on Wednesday. This is the exact reason why it is crucial that you seek out companies that are being dragged down by the market , those companies that have not changed fundamentally.

U.S. Xpress Enterprises (NASDAQ: XPRSA), one of our "Furious Five" features, traded up $1.34 to close at $23.34. As we mentioned recently trucking, rail and transport in general will continue to grow, especially those companies that transport construction material. We mentioned TMM SPA (NYSE: TMM) a Mexico play yesterday and U.S. Xpress is one that will benefit here in the USA.

Target (NYSE: TGT) made some noise on Wednesday after an upgrade by Lazard Capital Markets. The company expects high gross margins in 2006 and basically the quality retail companies are beginning to shine, just look at Sears Holdings (NASDAQ: SHLD).

Other stocks that made moves on the upside include L-3 Communications (NYSE: LLL) which traded up $3.44 to close at $76.93, Apollo Group (NASDAQ: APOL) which traded up $2.55 to close at $55.47, DSW, Inc (NYSE: DSW) traded up $2.50 to close at $31.65, Life Time Fitness (NYSE: LTM) traded up $2.39 to close at $44.38, Four Seasons Hotels (NYSE: FS) traded up $1.46 to close at $62.58, Las Vegas Sands, (NYSE: LVS) traded up $1.37 to close at $68.00 and Harley Davidson (NYSE: HDI) which traded up $1.34 to close at $49.30.

Under Ten

Now lets take a look at movers in the market under ten bucks, Home Solutions America (AMEX: HOM) traded up $1.14 to close at $7.94 after a rough day on Tuesday but the pressure will still be on the stock in today's trading session.

Peru Copper (AMEX: CUP), this was a pick by our very own Larry Oakley from Wall Street Corner a few weeks back when it was in the low $4 range, so this was a good call, the stock traded up 56 cents to close at $6.72 but it gets better it was halted with news pending at 2.37pm yesterday. Well after the close Peru Copper stated that they requested the trading halt on both the Toronto and AMEX due to a "frivolous" bid that it received from Southern Copper (NYSE: PCU). They were concerned about the stocks unusually trading activity and wanted to stop this in its tracks, but you know what they say where there is smoke there is fire, so keep your eyes on Peru Copper.

American Italian Pasta Company (NYSE: PLB) , if the name doesn't give it away let me tell you , they are a producer and marketer of dry pasta in North America, some brands include Mueller's, Mrs. Grass, Pennsylvania Dutch and Anthony's pasta . Everything from linguini to rigatoni, they do it all, some of their competitors include Barilla Holdings, which is by far the largest pasta maker in the world, yes surpassing the Ronzoni brand.

This has weighed on the company for some time. At one point this was a $51 stock and went as low as $3, it closed down in the $8 range yesterday, so for all intents and purposes this one fell out of bed. They currently have a 52 week low of $3 and a 52 week high of $23.64. Now I need to let you know that they company is losing money, they just reported that revenues dropped 7% in 2005, this is the first time in 12 months that they have given full disclosure of sales figures. But the stock had movement on Wednesday as it traded up 43 cents to close at $8.44, go figure.

Other stocks under ten bucks that made nice moves yesterday include Nitromed (NASDAQ: NTMD) which traded up 40 cents to close at $4.64, Cardica (NASDAQ: CRDC) traded up 37 cents to close at $7.26, DUSA Pharmaceuticals (NASDAQ: DUSA) traded up 36 cents to close at $4.90 and Lattice Semiconductor (NASDAQ: LSCC) which traded up 32 cents to close at $6.05.

Downers

Some Downers in yesterdays trading session include USG Corp (NYSE: USG) , they are being dragged down with the building materials sector as the stock traded down $8.09 to close at $76.20 on heavy volume.

Veritas DGC (NYSE: VTS) traded down $6.25 to close at $45.37, this is a company that is involved in the information end of the oil business as they supply integrated geophysical information and services to the petroleum industry. Now the stock ran up during the final week of May from $44.81 to close as high as $51.62 on Tuesday. So this pullback could be attributed to market conditions as nothing has really changed with the company. Actually it should be in better shape now as increased drilling in the U.S. is about to ramp up. So use this downturn as an opportunity to find a good entry point.

Diamond Offshore Drilling (NYSE: DO) traded down $4.09 to close at $78.16. Now nothing dramatic has happened with the stock, it is being dragged down by market conditions just like Veritas. Now the stock broke the $79.23 mark and could slip to high $75 to the low $76 range, but you need to keep an eye on the trading on this as it could drop to the mid $77 range and pop back up. Now keep in mind that the stock traded as high as $95.65 in May 2006, so the potential is there. Keep this one on your stock watch.

Other stocks that traded down but shouldn't be down there include U.S. Steel (NYSE: X) which traded down $3.30 to close at $60.61, Schlumberger Ltd (NYSE: SLB) traded down $3.45 to close at $60.51, Steel Dynamics (NASDAQ: STLD), which traded down $3.26 to close at $53.74, Petroleo Brasileiro (NYSE: PBR) traded down $3.53 to close at $81.80 and Occidental Petroleum (NYSE: OXY) which traded down $3.07 to close at $94.72.

Now some stocks under ten bucks that received the royal smack down on Wednesday include International coal Group (NYSE: ICO) which traded down $1.40 to close at $7.10 on heavy volume, Polyone Corp (NYSE: POL) traded down 54 cents to close at $9.09, Movie Gallery (NASDAQ: MOVI) the stock that shot up on rumors traded down 49 cents to close at $7.01 on over 5.3 million shares traded, Input/Output Inc (NYSE: IO) traded down 46 cents to close at $8.74 on heavy volume and Grey Wolf (AMEX: GW) which traded down 40 cents to close at $7.28 on over 3 million shares traded.

Analyst Upgrades/Downgrades

Recent Analyst upgrades include American Woodmark (NASDAQ: AMWD) which was upgraded to a Buy from a Neutral by Sidoti & Co, Aeroflex Inc (NASDAQ: ARXX) was upgraded to an Above Average from an Average by Caris & Co, Broadcom Corp (NASDAQ: BRCM), a company that we just spoke about on Wall Street to Main Street, was upgraded to a Buy from an Above Average by Caris & Co, Boeing (NYSE: BA) was upgraded to a Buy from a Neutral by Banc of America and Target Corp (NYSE: TGT) was upgraded to a Buy from a Hold by Lazard Capital Markets.

Recent Analyst downgrades include Prosperity Bancshares (NASDAQ: PRSP) which was downgraded to a Hold from a Buy by Sanders, Morris and Harris, Lamar Advertising (NASDAQ: LAMR) was downgraded to an Inline by Goldman Sachs, Herley Industries (NASDAQ: HRLY) was downgraded to an Underperform from a Market Perform by Raymond James, Northrop Grumman (NYSE: NOC) was downgraded to a Neutral from a Buy by Banc of America and Johnson Controls (NYSE: JCI) was downgraded to a Neutral from an Outperform by Robert W. Baird.

Recent analyst coverage initiations include Regis Corp (NYSE: RGS) which was initiated with a Peer Perform by Bear Stearns, Ethan Allen Interiors (NYSE: ETH) was initiated with an Outperform by Raymond James, Bancshares Florida (NASDAQ: BOFL) was initiated with an Outperform ratings and a $26 price target by Raymond James, RCN Corp (NASDAQ: RCNI), which by the way I've been seeing a lot of those RCN Vans in New York City lately, but the company was initiated with a Hold rating by Morgan, Joseph & Co, and Ingersoll-Rand (NYSE: IR) was initiated with a Neutral rating and a price target of $45 by Banc of America Securities.

Investors Commentary

And the Readers/Listeners Speak:

Don from New Jersey said: "I've just started to listening to Wall Street to Main Street" and was surprised on how informative it was. A friend of mine turned me on to it and I think that its great, keep up the good work."

Don, thanks for the kind words, its always good to hear that our listeners and readers are finding "Wall Street to Main Street" beneficial. Word of mouth advertising is the best way to go and hopefully all of our listeners and readers will follow your lead and spread the WSMS word.

Daisy from New York asked: "I know that the metals have been coming down lately including copper, do you think that it's a good time to start looking at Southern Copper (NYSE: PCU) as a potential rebound stock?"

Daisy, Southern Copper in 2006 went from a low of $69.36 and closed as high as $105.85 on May 10, 2006. The stock traded down $3.03 on Wednesday to close at $80.72, I'd like to see if it breaks $78 on the downside because at that point it could freefall to the low $70 range before it bounces back. Their mining and smelting activities are primarily in Peru and Mexico, so as you watch this trade you may want to consider Peru Copper (AMEX: CUP).

Andy in Maine said: " I caught your show while I was looking for financial shows on Monday for my iPod and I have to say that I'm glad that I found it, is this show going on national radio and how about television?, hey I'll help produce it"

Andy, I'm glad that you found us, so we welcome you to the growing "Wall Street to Main Street" family, as far as national radio syndication, we're working on that and any assistance that we can get on that end from our listeners is appreciated. As far as a TV show, well that is something that is being kicked around, if we need production help we'll shoot you out an email.

Marie in North Dakota asked: "I came across a new issue by the name of Luna Innovations, and I wanted to know if you thought it was a good play or not."

Marie, Luna Innovations (NASDAQ: LUNA) is a new IPO that went public on June 2, 2006. The stock is relatively new and came public at a time that Vonage (NYSE: VG) created a massive IPO debacle, but Luna stood strong at $6 where they went public. The company researches, develops and commercializes innovative technologies in molecular technology and sensing solutions. I haven't had the time to get my hands dirty and research it, and I am not going to give you an on the fly outlook on whether you should buy the stock or not, it would not be fair to you. So what I'm going to do is try to get the CEO of Luna Innovations on "Wall Street to Main Street" so they can tell you exactly what the company is about and then we can evaluate its value to you.

Thanks for the emails and keep them coming, this is the interactivity that we need to really make "Wall Street to Main Street" work for you.

FURIOUS FIVE

The latest addition to our "Furious Five" companies that we see excelling in their industry in 2006 is Omega Healthcare (NYSE: OHI).

For our outlook, and other vital information on the companies that we feature as the "FURIOUS FIVE" on Wall Street to Main Street just subscribe for FREE at www.namcnewswire.com

Omega Healthcare Investors trades on the NYSE under the symbol OHI.

We cannot stress enough that investors need to do their due diligence, call the companies, get the information, consult with your investment advisor and if you do not have one consider getting one. Put the same time into investigating these companies as you do when you go to purchase a new television, it's only for your protection. When it comes to thinly traded securities stagger your orders or put a limit order in to avoid a run up.

NAMC Newswire Note

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Disclaimer:
None of the information contained on the NAMC Newswire constitutes a recommendation by the NAMC Newswire, its journalist, nor its parent company that any particular security, portfolio of securities, transaction, or investment strategy is suitable for any specific investors or person. Each individual investor must make their own independent decisions regarding any security, portfolio of securities, transaction, or investment strategy featured on the NAMC Newswire or NAMC Radio Any past results are not necessarily indicative of future performance. The NAMC Newswire, its journalist nor its parent company does not guarantee any specific outcome or profit, and all investors should be aware of the real risk of loss in following any strategy or investments featured on the NAMC Newswire or the NAMC Radio. The strategy or investments discussed may fluctuate in price or value and investors may get back less than you invested. Before acting on any information featured on the NAMC Newswire website or the NAMC Radio segment, investors should consider whether it is suitable for their particular circumstances and strongly consider seeking advice from their own financial or investment adviser. Investors are also urged to do their own due diligence before investing in any security.

All opinions featured on the NAMC Newswire or NAMC Radio are based upon information that is considered to be reliable, but neither the NAMC Newswire, its journalist, its parent company, affiliates nor assigns warrant its completeness or accuracy, and it should not be relied upon as such. The statements and opinions featured on the NAMC Newswire by its journalist are based on their outlook at the time of the statement or opinion, and are subject to change without notice. NAMC may at times hold a position in the companies that it features, in these cases appropriate disclosure is made.

Louis Victor is the host of the syndicated radio show and financial newsletter "Wall Street to Main Street" which is featured on the NAMC Newswire Radio. He has been involved in the financial industry for over two decades, on the retail and investment banking ends. He is also well versed in the advertising and marketing industries, which has given him insight into market trends and unqiue companies that may be under the radar.

Capital Preservation The Best Offense Is The Best Defense

Writen by William Tan

If you are a sports enthusiast, you probably know that the best offensive team does not necessarily win the championship. Instead, it is normally the best defensive team that will come out on top. Of course, to score - you need offense. But with a solid defense, you do not need to score very often to win. As long as your team does not concede any points, then you cannot lose – a draw is the best your opposition can do against your team.

What has this got to do with anything in trading? The same principle holds in trading. All traders are excited about making money – most do not think about protecting their investment. Defense or stop loss is necessarily to protect what you have and risks have to be carefully analyzed to ensure that your odds of success is high. A good defense will limit and minimize your losses – making it easy for you to recover from this minor setback.

In many ways, sports and trading have this similarity. In sports, when your team is behind, the players will be motivated to attack and also take more risks that will leave the defense vulnerable. In trading, same – when you lose, you will be thinking of getting back your capital by taking more aggressive positions. Sometimes, trade even when there are no good trading opportunities.

The harder you try to get back into the game the worst it becomes. As trader, we have all been through this unfortunate path before. This becomes dangerous because taking aggressive positions made through emotional decision making will cause even more damage to your portfolio. While this could provide the adrenaline rush and the excitement, it definitely will not provide any help to your financial well-being.

When you understand that you can prevent taking big financial loss (in any venture), this is when you will start to see your assets grow. The only way to protecting what you have is to organize a strong, non-compromising defensive line-up. This defense will ensure that you will always be in the game.

Every time you look at a trade – think of your defense first before thinking of your profit. Eventually this will set the discipline in you. This simple rule will keep you in the world of investing for a long time. Capital preservation is key to your survival in the investing game or any business. Build a good defense and you might be pleasantly surprised how easy it is to profit from the market.

Get your game plan together - weigh the risk and challenges that you face. By looking at the big picture, you can gather enough information to come up with an intelligent defensive strategy. A strong defense will keep you from going out of business.

Copyright 2006 CashFlow Avenue

CASHFLOW AVENUE is established to provide Low-Risk Options Trading Recommendations to aid the common traders in their pursuit of financial freedom and a better lifestyle. http://www.cashflowavenue.com

Choosing The Right Investments For You

Writen by John Mussi

With all of the investment opportunities out there today, it might seem difficult to decide which one is the right one for you. When it really comes down to it, though, having such a large variety of options is more of a benefit than a hindrance… it allows you to customize your investment portfolio to your individual tastes much more than you would be able to with only a few choices.

Unfortunately, it can sometimes be quite hard to figure out if an investment is right for you until it's too late… the stock might go through a drastic increase or decline in price, or you might only have a limited time to invest in a certain company's stock before a merger or split.

To help you take advantage of the investment opportunities that present themselves to you, here are a few useful tips that might help you to decide whether or not an investment is the right one for you.

Price

Obviously, the price that a stock or bond is currently selling for can make a big difference on whether or not the investment opportunity is right for you. If you're trying to invest on a limited income or you simply don't have the money to spare for large investments, you might want to reconsider certain high-priced stocks unless you're fairly certain that they'll show you a good return. Even then, you might want to consider buying partial shares over time instead of several shares now.

History

The history of a particular stock or bond can tell you a lot. If the price for the particular stock has always been quite low and suddenly rises over time, there's a good chance that it will drop again before too long and if you invest when it's high you might lose money on the deal. On the other hand, if a certain stock has been climbing steadily or has taken a slight dip from its usual prices (without any company news causing the drop) then you might have a good chance at making money in the long run.

Time

Some investment opportunities have a time limit attached to them… perhaps a company is selling shares for a brief period of time in order to find investors for a new branch, or a company is preparing to merge with another or split from another. You should use caution before deciding to invest in one of these opportunities, and investigate the stock prices for the companies involved. If they've performed well in the past, there's a good change that you'll be able to come out on top in the deal. If, however, the company has had problems (especially recently), you might be better off to let this one pass you by.

Recommendations

Where you hear about the investment opportunity can have a large bearing on how good the opportunity actually is. Advice from market professionals can usually be trusted to be good, but you should never act on a stock tip that you receive as part of a junk e-mail or an unsolicited advertisement. You should also take extreme care if you happen to work for the company that you've heard the tip about… depending upon what you buy and when, you might have problems with insider trading meaning that you had access to information that the general public didn't.

Other Circumstances

Of course, there are other circumstances that might arise that aren't mentioned here. If this happens, then seek the advice of someone that you trust or simply follow your own instincts.

You may freely reprint this article provided the following author's biography (including the live URL link) remains intact:

About The Author

John Mussi is the founder of Direct Online Loans who help homeowners find the best available loans via the http://www.directonlineloans.co.uk website.

Seven Reasons Why The Trend Is Your Friend

Writen by Thomas Mullooly

We spend a great deal of time trying to spot stocks heading in the right trend, or direction. Careful attention needs to be given to the support and resistance lines. These lines are also called trend lines. Here are seven reasons why the trend can be your friend in investing:

1. These lines draw the general trend, or direction, the stock is heading. They're not used for daily tracking, they're more of a longer-term direction that the stock, mutual fund or commodity is heading. If you are using a longer term approach, the trend is what you really want to know, not necessarily the day to day wiggles in a stock.

2. Often times, the trend line will give you guidance in a stock for years, not just weeks or months. But these support and resistance lines are often bumpers, or guardrails, along the way. Stocks often drift toward their support or resistance lines and then bounce back in the opposite direction.

3. If you can pick off a stock you find attractive as it is bounces off the support line, it could be a terrific time to buy. The reason is you have a strong, logical place for your stop point...just under the support line, which is really close by. This helps minimize the amount you have at risk.

4. Some of the best winners come from stocks that are purchased just as the stock breaks through overhead resistance and forms new patterns. Holding the stock until it breaks support line (which might be possibly many months, or even years later) can really help your overall performance!

5. The reasons behind why a stock jumps through a brick wall are often not clearly visible. The reasons for the move may emerge days or weeks (or even a year!) down the road. But when a stock or a mutual fund breaks through the trend line, either up or down, it's important news.

6. If a stock or mutual fund we are following breaks through it's overhead resistance, we have a high level of confidence that the stock will continue to climb upward.

7. Lastly, if the support line of your mutual fund or your stock is broken, beware! This is a very clear signal we should consider selling a portion (or maybe even the entire) position. Breaking the support line is the ultimate sign that supply is now clearly in command. Your principal is now at risk.

Thomas P. Mullooly, President of Mullooly Asset Management, LLC (http://www.mullooly.net) has spent over twenty years in the investment industry, as a broker and as an investment advisor. Feel free to contact us to check out the relative strength of your portfolio by sending an email to tom@mullooly.net or visiting http://www.mullooly.net/403b-plan.html or sign up to receive the market report and tips on how you can soundly invest your money at http://www.mullooly.net.