A new year means a new movement in the global stock market and if you want to grow your money, it is essential that you invest it in the right places. Endless opportunities for greater profit are still present for many investors even with the economies of many countries are looking down.
Oil resources in many countries are reaching higher demand but are met with lower supply because of the recent events in the Middle East. As the oil prices are currently pushing up, the continuing irresolution of conflicts in the area could signify that the prices could still increase in the next few years.
2. Internet Industry
Google, Microsoft and other Internet companies are gaining massive reputation with consumers because of their products and services that integrate the use of the Internet to make daily tasks easier. The development of these technologies, including the design and manufacturing, will continue to grow as mainstream markets uphold their values in the following year consecutively.
3. Renewable Energy
With oil’s supply fluctuating due to increasing conflicts in the Middle East, it is highly likely some people will turn to alternative energy sources for power. Some companies have invested in using renewable energy technologies to generate energy from different substances and materials, including trash. In the next few years, these products will be invaluable for many industries.
Credit cards are actually free because if you have good credit, your lender can automatically get you one. However, it is very easy to get into deep debt because of credit cards. Here are a few things you need to remember when you have one.
Keep a Notebook
Many shoppers have a bad practice of maximizing their credit cards to know the amount they’ve already spent. This is bad news if you have a high-limit credit card. Keep it a point to use a notebook and list down the amount you spend with your card every time you shop with it to avoid this habit.
Pay On Time and In Full
Paying on time and in full helps avoid high interest rates on your credit bill. Many people get into deep debt because they only pay the minimum fee needed for the credit card and the penalty fees for late repayments. Paying on time and in full allows you to save money by using your credit card like a bank account.
Spend your credit only on things that you actually need, such as a broken appliance replacement (which is direly needed), wholesale parts for improving your home or food. For other things that you do not actually need that are quite expensive, it would be wiser to use your actual money. Learn to save up effectively.
Mutual funds are often the option entry-level investors first try before they move on making their own investments. However, many pull out of mutual funds early because it cannot move against the market and is strapped to numerous SEC regulations and requirements. A hedge fund, while expensive and limited only to a number of investors, allows investors to gain more. So why invest in a hedge fund?
In the previous decade, hedge funds numbers have increased by 20% yearly despite the economy. Hedge funds greatly outperform mutual funds and equity markets effectively.
Hedge funds in a balanced portfolio allow your investment to reduce overall risk and instability. It could potentially increase your returns. Hedge investment may make use of different strategies to ensure that it gets higher returns and lower overall risk. It is essentially a long-term solution for your investments.
However, you will need high capital to invest in a hedge fund. On average, most investors have at least £250,000 to invest in a hedge fund. Hedge fund investor numbers are also limited; some hedge fund managers will only get 40 investors for a certain fund.
Seasoned investment professionals who will ensure the growth of the fund manage hedge funds. Without restrictions from SEC regulations, these managers could use any form of strategy to ensure the growth of the fund.
The UK has a high tax rate even for its basic amounts. When you make a profit above £10,500, you are automatically subject to capital gains tax, which gets 18-28% of your profits. Other taxes will also apply in the different areas of your investments. Here are a few things that could help you save taxes in the United Kingdom.
1. Tax Return Deadlines
Before every October 31 each year, you could make a paper tax return. In the UK, you could file for a paper tax return online up to January 31. If you are late, you could be fined £100. However, you could save much for your finances.
2. Annual Investment
Annual investment allowance for landlords could claim them a £250,000 yearly relief for expenditures including tools and computers. The AIA started on January 2013 and is still operational onwards.
3. Self-Employed Car Costs
If you are declared self-employed, you could claim for running car costs. If you own a vehicle that is owned by you privately, you could claim a part of the total cost. Make sure to register your car as well.
4. Annual Losses
You could carry your losses forward from one year and offset them against the following years profits.
5. Payments on Account
A self-employed person could earn relief by applying to reduce payments on account to the HMRC. If you think your profits in your business will be less in 2013-2014 than the year previous, then you could apply to reduce payments.
In the UK, each person has an annual tax-free capital gains tax or CGT that ensures any amount below £10600 is not taxable; only amounts above the CGT are taxable. You get taxed 18% for a basic rate taxpayer and a higher-rate taxpayer gets 28%. If you want to avoid paying CGT at 28% you could do the following.
1. Spread It
Sometimes, the wholesale method won’t cut it with most investments. Selling a set of stocks in one go could earn you high profit past the CGT mark. If you split your sales into more tax years, you take advantage of more CGT year allowances. Just multiply the £10600 ceiling mark with the number of years you’re willing to wait it out.
Deducting capital losses from your gains to arrive at your net gain lowers the total profit you make in a year. By using losses in the same tax year as gains, you bring down your tax. You could use the losses four years ago against your current gains too.
An Individual Savings Account or ISA helps preserve your income and capital gains . Investors who could put up more than £10.000 in an ISA could gain profit that couldn’t be touched. This is an effective method to reduce the CGT you pay to the HMRC effectively.
If you’re new to the stock market arena, here are a few things you should know.
Stocks are not pieces of paper. When you buy a stock, you take a share of ownership in a company. As a shareholder, you represent a claim on assets and earnings the company makes. Different kinds of stocks exist. You have company size, industry or sector and growth pattern stocks.
As you are buying and selling securities, you could have your stocks invested in different financial markets. There is the money market, the capital market, bond market, foreign exchange market and the dealer market. Each of these markets have different purposes and grow at very different paces.
3. Stock Behaviour
Stocks usually move the market and the market moves depending on enthusiasm, fear, rumours and news about industries, governments and countries. Individual stocks are not the market as well; some stocks may go up while others are going down. However, the opposite could also happen to an unsuspecting investor.
4. Stock Values
Stock values are relative depending on the company and the earning prospects of that company. Buying a $100 each stock from Apple is a good price because Apple has a high prospect of earning.
The infamous UK payment protection insurance policy banks and lenders have mis sold customers have reached great new levels as Chief Ombudsman Natalie Ceeney of the FOS points out that the Ombudsman is dealing with 2,000 new cases on a daily basis. The staggering average per day has made up at least three quarters of the 283,251 new complaints in the last few months.
Ceeney also points out that the influx of payment protection insurance shows no signs of slowing because banks and lenders often refer customer claims they dispute to the Ombudsman, which takes more time. Lloyds TSB has the highest number of PPI cases referred to the ombudsman, with the ombudsman favouring the customers 86% of the time.
The banking group said that their complaint levels in general were falling. However, many analysts see otherwise. The FOS finds that PPI complaints continue to increase, having customers wait longer to get their complaints sorted and many businesses causing more excuses for delays.
The FOS advises businesses to show real commitment with better customer service and handling of complaints by actively engaging with the Ombudsman.
PPI receives an average of £3000 in compensation if the customer’s claim is successful. In some cases, customers receive more due to compound interests that have gained momentum for years.
It is not a walk in the park to pay for one’s mortgage closing costs even if interest rates have reached all-time lows from 2012 to 2013. Banks are still strict and making it difficult for people to actually get good refinancing deals. You might not even get a good mortgage refinancing deal on good credit scores.
If you take out a $400,000 mortgage in May 2011 with an interest rate of 4.75%, you could actually save more than $200 today as the 4.22% increase in March 2012 had fallen to 3.84% in April 2012. The drop allowed many to become potential borrowers for refinancing especially those with interest rates above 5%. Some were able to refinance their closing costs to at least 4%.
However, to get good mortgage refinancing, it is important that customers have the right requirements, specifically taking advantage of the relief offered by the Bank of America, Citigroup, JP Morgan Chase and Wells Fargo. Their settlement options allow the borrower’s interest rate to be at least 0.25% lower than the borrower’s existing rate, making it a big relief for many.
Customers face the challenge of refinancing being a bit challenging and time consuming especially borrowers who are self-employed may have some problems even if they have notable credit scores and good assets. Customers might have problems with the clogged mortgage pipelines in the country, which has big mortgage lenders 70 days to complete a refinance. Low appraisals is another problem especially for borrowers who have no equity at all.
Regardless if you’re a reactive or systematic investor, the best chance of minimizing your losses and upping your gains is through the help of a well-diversified portfolio. A diversified portfolio has you invest in different industries that are completely unrelated to each other, which helps you minimize your losses if the oil industry slows down but cotton production goes up.
However, you have to be careful; the key to the stock market is knowing when to risk and when to play safe. Diversifying your portfolio so much could have you lose on potential gains. Remember, the higher the risk, the higher the gain.
Diversification is about spreading your investments to different arenas and the best way to ensure you get good safeties in the stock market is to ensure that all business practices by the company or companies are sound. Look at their formulas during a stockholder’s meeting and see for yourself if the company’s plans actually work for you. Also, look at their track record. Think as how a bank would look at a company seeking a loan.
Know if you’re a short-term or a long-term investor; these directly affect the way you invest and your attitude towards your portfolio. If you’re a short term investor, you might be prone to market fluctuations and you’ll need good diversification with minimal to average risk. A long term investor could make investments that may fluctuate and suffer great losses, but with care, could get very high returns in the future nearing the end of their goal.
Essentially, both financial products could possibly disgust you the next time you want to take out a financing from a lender.
According to financial experts, payday loans still win the highest interest rate fees against car title loans. While both stick it out at three-digit annual percentage rates, payday loans gross higher. Most payday loans could reach illegal rates of 300%-400% interest rates in some states while car title loans only get 250% at maximum.
However, most customers still prefer payday loans because with car title loans, lending companies repossess your vehicle if you fail to pay them as this is used as collateral. For payday loans, you could broker your way with debt consolidation, but still pay the exorbitant interest rate.
In some car title loan situations, customers said that the lending company does not take the vehicle away from you “physically”. When they repossess your vehicle, it just means that they hold the title of ownership to your vehicle until you pay off your tab. However, the longer you fail to pay for your financing, at any time the bank could still repossess your vehicle “physically”.
According to most customers, they would prefer payday loans even if it wins the exorbitant interest rate wars; nothing feels better than knowing the lender will not repossess anything you have at home and you could still consolidate your debts in the future.