Investing without brakes is hazardous to your portfolio

The business of investing in stocks is an inventory “buying & selling” business. Naturally, the companies that sell stock to the public want you to buy and hold it forever in order to maintain its value. But if you are buying without any selling, you are literally driving without any brakes. That is a horrifyingly unsafe position for your principal. The most effective defensive brake system for your money is a stop-loss order on your stocks. A stop-loss order is an order you give your broker to sell your shares if a stock falls below a certain price. You can select a stop-loss price for your stock based upon chart patterns or a percentage drop from your purchase price. And some brokers automatically move them as a stock moves up in price to lock-in profits for you. The first time I learned this lesson (not the last unfortunately), I was just 18 years old. One of my early stock purchases, recommended by a stockbroker from a famous brokerage firm, was stock in a famous airline – just before it trailed off into bankruptcy. Had I read this article before the airlines’ financial calamity, I would have rescued most of my $5,000 and prevented my own financial calamity. But you cry, “The greatest investor Warren Buffett is a buy & hold investor!” No, I’m afraid he is not. Mr. Buffett mainly buys whole companies or controlling interest in a company. He buys control so that if there are problems with the company, he can hire/fire/make changes. If there are critical problems with the company whose stock you own, the only control you have to protect your principal is to sell. When a public company goes bankrupt, 70% of the time the shareholders receive no money at all. How many stocks do you want in your portfolio worth $0? I know exactly how many that I want, and I know that stop-loss orders prevent it from happening. There are a few “loss-recovery” methods, but you’ll never sell enough covered calls to recover from a stock trading under $5, or be able to buy puts on a stock that has been de-listed from an exchange. But the nearly certain protection is to place a stop-loss order on the stocks you own. You can choose any percentage loss amount (5%-25%) based on your experience, but you must have a stop-loss order in place to protect your capital. There a zillions of old stock market sayings. Here is one of them for those of you who are still skeptical, “If the smart-money has sold and moved on, what type of money still own the stock?”

Predictable certain and secure tax lien certificates produce guaranteed profits of 16 18 even 24 and more

How would you like to find out about an investment vehicle that is not affected by the topsy-turvy nature of the stock market? How would you like to know about a method of investing that locks in your rate of return, regardless of what happens with the so called real estate bubble? If you’ve ever put money into the stock market, you know that it can be a frightening roller coaster ride! The market goes up and the market goes down. Often without any rhyme or reason! Even the expert predictions prove to be wrong time after time! You can lay awake night after night wondering if you will ever see your hard earned investment dollars again. If you are like most people you are probably asking, “When can I have a little predictability?” Well, that is exactly what you’ll find in the little known world of government issued Tax Lien and Tax Deed Certificates! What is a Tax Lien Certificate? A Tax Lien Certificate is a lien on a piece of property for taxes owed. These Certificates have proven to be Predictable, Certain, and Secure! Here’s why... PREDICTABLE...because the rates of return are fixed by law! The rates differ by state and local statutes. For example Arizona pays up to 16%, Florida is 18%, and in Texas you get 25%. In states like Michigan you can earn up to 50%. The best part is that your rates of return are locked in and guaranteed. No matter what happens to the stock market, the economy...your rate of return remains the same. So you know from the beginning what your minimum profit will be! (And in some instances you can earn massive windfall profits up to 500%.) CERTAIN...because you are actually investing with the government! The government makes the rules, the government sets the interest rate you’ll receive, and the government enforces the process! (You will either receive your initial investment back...along with the substantial interest rate as your profit. Or you will end up owning the property itself...all according to government regulations.) SECURE...because your investment is attached to the real estate the taxes are owed on! Your investment is secured by a Government Certificate, which is attached to the real property. The property cannot be sold with clear title until your Certificate is paid off in full. (In other words the Tax Certificate is a priority lien on the property...so nothing can happen with that property until you get paid.) In fact, a Government Tax Certificate is normally superior to a mortgage lien! So if your investment and profit are not paid within the specified time period, the mortgage company might step in and pay you off in order to protect their interest. If they don’t, you own the property for pennies on the dollar. Any way you cut it, Government Tax Certificates offer a solid investment choice that is Predictable, Certain, and Secure! Now, some state use a Tax Deed process. And we’ll cover that next time! The key to success is to arm yourself with the right information and understanding of the rules in your particular locale. For there is power in knowledge, provided you have the right knowledge...and provided you act upon it!

Commodity futures tradings

Compared to cash contracts, which require payment against the physical delivery of goods immediately or after a specified period, a futures contract is a special type of agreement made strictly under the rules of a commodity exchange, which may or may not call for the actual delivery of goods and payment in cash on a future date. According to Emery, a futures contract can be defined as a contract for the future delivery of some commodity without reference to specific lots, made under the rules of some commercial body, in a set form, by which the conditions as to unit of amount, the quality and time of delivery are stereotyped, and only the determination of the total amounts and the price is left open to the contracting parties. Such contracts are meant exclusively for future settlement, though the exact date of the settlement is decided by reference to the wishes of the seller and the established rules of the commodity exchange. Such contracts do not specify the particular grade of a commodity, but impliedly refer to a basic grade called the contract grade, accepted as the common grade for all futures dealings. The details in respect to the amount, the time of settlement, the quality and so forth are mentioned in the rules and regulations, and are common to all such contracts. The contracting parties have to decide upon the price at which the contract is to be settled, sometime in one of the trading months specified by the exchange. Futures contracts are made only in the ‘ring’ of the commodity exchanges, and not outside the exchanges. Only members of a commodity exchange can enter into such a deal. No outsider can become a party to a futures agreement. Such contracts can be made only in multiples of a fixed unit of trading. No such contracts can be made in fractions of these units.