Victory Investment

Archive for April, 2010

Concerns about Greek default, and the knock-on effects which could have drastic consequences on global financial markets, have diminished – for now.  However it is far too early to completely write off a Greek default which seems inevitable in the long term. Some analysts say five years until default, but others say this is far too optimistic and Greece will collapse financially well before that.

However, for the moment with the help of a €12 billion loan from the EBC and IMF, Greece has managed to ward off default. Therefore, coupled with the traditionally weak summer period and less demand from Asia, we are likely to see gold remain under pressure for the next month or so.

Although lending furtherr money to Greece seems to be pouring more money down the drain, a default would drive German and French banks near bankruptcy because of the huge amounts they have invested in the debt. The knock-on effects would then descend on Portugal and Ireland, who also face huge debts and which would in turn put stress on the U.K and Spanish banks.

The prospects for gold remain strong as the gold price continues to hang around 00. At the moment (1/07/11) gold is trading in the low ,490s however, this is largely from relief that Europe has not actually imploded financially yet. However, there is more than enough economic distress to keep gold prices from falling further:

Massive structural problems exist in the U.S. The housing sector continues to be a problem and the fiscal deficit is large.
Worries over the increasing possibility that Greece will default will resurface over the next few weeks and months.
Greece defaulting would produce a domino effect, forcing Portugal, Ireland, Spain and Italy into the same position- European lenders still have almost .trillion linked to these countries.
The weak US dollar is gradually losing its status as a global currency, which is a logical consequence from the quantitative loosening; however the US only has until the 2nd August to make a decision whether or not to raise its debt ceiling.

The safe haven aspects of gold investment will return especially from September so now is the perfect opportunity to  buy gold while prices are sitting lower. Although technical factors could drive gold down further in the short term, things are likely to get worse for the Global economy, which will see gold continue upwards again; therefore this is perhaps not the time to be selling gold. Until the economies of countries in Europe and the USA begin to pick up (which seems some way off yet) inflation will continue to increase and as such gold prices will continue to climb.

Overall, given the chronic uncertainty the financial world is facing and the trust lost in central banks, we believe that investing in gold is the right answer. The situation for the Euro and the US Dollar only seems to be getting worse and therefore the global expansion of monetary supply should continue to provide gold investments with a positive environment to thrive in.

Lately, a lot of attention has been placed on proposed changes to how mutual fund companies charge their clients through expense fees. At this particular moment in time, investors pay a relatively low management fee when they own no-load investment funds. From those fees, the fund company is compensated as is the individual adviser, including the no-transaction fee firms like Charles Schwab.

Under the proposed changes, one key recommendation will limit the amount of fees that the fund company can collect to a “lesser of” factor. The lesser of is actually 6.25% or the maximum charged on a loaded fund. For example, consider a fund that has a front-end version as well as a no-fee version. If the front-end fee is 5% and the no-fee expense ratio is 1%, the maximum the company could collect on that fund is 5%, or 5 years worth of expenses.

The question becomes what happens after 5 years? Well, the fund would still be able to collect up to 0.25% of fund assets to account for administrative-type of expenses. But what about the adviser? He will either a big drop in pay (no more trailer fees) or will recommend changing to another fund so that he can get paid again. Or, most likely, will do away with collecting trailer fees at all, sell you the higher-priced (up front) front-end fund and charge you a management fee for all of the assets you have with him.

But management fees at the adviser level also poses a problem because how advisers will target only the most affluent, leaving folks who need the advice most on their own with no advice or recommendations at all.

Not a very rosy picture — either bad advice because churning (when you move from one investment to another simply for the sake of earning a commission) will become rampant among financial advisers or individuals who fall short of investment minimums will be shut out of the advice-intensive industry altogether (of course, the Schwabs will still be around).

Perhaps taking a closer look at transparency rather than the fees themselves would make the most sense for the SEC and the individual investors alike. After all, sometimes it is not so bad to have to pay a fee for any kind of service when we know what we are paying and how much the person making recommendations is earning, not like today’s fees where we know we are paying something, someone is getting rich, and we know nothing about what our advisor is really earning.

Deutsche Bank AG reported a considerable decline in the sales in the third-quarter on weak investment banking earnings and write-down over its bn deal with the rival Postbank, the largest retail bank of Germany by clients.

Deutsche Bank anticipated that its acquisition over Postbank may stabilize its earnings and help promote the Deutsche Bank’s position as a leader in the retail banking sector of Germany. However, the low trading activity over the summer season and gloomy Postbank prospects have created a bitter situation for the Deutsche Bank, making it suffer more after the share fall.

Deutsche Bank had a plan to increase its capital by 10.2 billion euros but a series of negative events hurt the business strategy of the German bank, sending the stocks down by 4.5%. Along with Deutsche shares, declining stocks of other banks like HSBC and Credit Suisse and low volumes of cash equities dragged the Stoxx Europe 600 index down by 0.8% on Tuesday.

Seasonal falls in the months of July and August pulled down the sales and trading revenues of Deutsche’s CB&S Businesses (Corporate Baking & Securities). Moreover, Deutsche Bank’s annual sales fell by 9.5% on the Europe Stoxx index. The level of the revenue decline was substantially below the level of the last year’s third quarter revenues making the situation more jittery for the Deutsche Bank.

However, a Hamburg-based analyst M.M.Warburg said, “Despite the seasonally weak performance, Deutsche Bank’s strength remains investment banking and demand will rebound at some point.” Invest banking business has turned volatile over the time and addition of the stronger and stable component is very much a need of the time, according to Warburg.

In the view of the Deutsche Bank, the pretax profit in the months of July and August in the global transaction banking and the private and business clients division were higher than in the year-earlier period; however, not really sufficient to avert declines in other divisions.

Who knew that the small community banks in US would turn out to be one of the best investment opportunities of recent times? But, this fact has indeed come true and the tide is turning in favor of the small community banks. The masses are banking on the secure option of small banks that have good rapport rather than choosing the ambiguous financial institutes.

The bloodbaths that many huge investment banks have witnessed has made the general public stand up and take notice of the risks that are involved with such institutions. The high risk practices adopted by these banks have made people vary of the outcome and hence people are shying away from banking with these institutes.

This has presented a golden opportunity to the small community bank in USA. The small community banks have been able to strike a chord with the general public and the inherit capability of the small banks to strike immediate rapport with the general masses has helped their cause. Most of these small community banks have been in existence for decades and form an integral part of the society. People are able to relate to such community banks in a better manner and the trust factor has increased many folds after the recent crisis.

Moreover, most of the big financial institutes are on the defensive these days and are more inclined to playing a damage control role as of now. With the entire banking community undergoing re-structuring and reshaping of policies, there is little time with these banks to give to the customer. However, small banks prove to be just the opposite as they are able to deliver personal attention to the clients.

Also, small community banks are not afraid to adopt innovative approaches. Decisions do not necessarily go through various levels and then finally get implemented. If there is any change required, it can be implemented with immediate effect due to the small size and manageable proportion of these banks.

One more emerging trend that makes these small banks a good opportunity is that not only individuals but small and mid size firms are also treading on the same path of security and have started to choose small community banks as a preferred banking option. Thus, a small community bank is an ideal investment option under the given circumstances.

If interested in buying small community bank in USA contact finders firm  www.Keyfunds.com or one of its affiliates Credit Capital Funding

Robin Trehan B.A, MIB, MBA is a financial expert, associated with Keyfunds and Credit Capital Funding

Savings account is an valuable instrument to keep money faithfully. With bank account, you can have a safe place for your funds. Other bonus are the interest rewarded for your deposit and the privileges given to depositors.

In India, Bank of Baroda can be your bank of choice in beginning a savings account.

Bank of Baroda or commonly known as BoB is one of the largest banks in India along with another Big Four banks namely Canara Bank, State Bank of India, Punjab National Bank and ICICI Bank. The bank, together with 13 other primary profitable banks of India, was nationalised on July 19, 1969, by the administration of India.

The bank was established in July 20,1908 by Sir Sayajirao Gaekwad III, the Maharajah of Baroda in the state of Baroda, Gujarat. Currently, the bank’s headquarter can be located in Baroda Corporate Centre, Plot No.-C-26, G-Block, Bandra Kurla Complex, Mumbai, India with Mr. M.D. Mallya as administrator and managing director.

Today, BoB has a network of over 3,000 branches and centers, and almost 1,100 ATMs around India. It has significant international presence with a network of 72 offices in 25 nations, six subsidiaries, and four agent offices. The bank has departments in New York, London, Dubai, Hong Kong, Brussels,Singapore, Botswana, Guyana, Kenya, Tanzania, Uganda, Zambia, Malaysia, China, Thailand, Australia and China.

It has also has an extensive extent of banking goods and financial services to corporate and retail customers like investment banking, credit cards, asset management, consumer banking, corporate banking, investment banking, investment management, private banking, private equity and mortgages.

When you are considering to open for a bank account at Bank of Baroda, you must bring the following identification and proof of address documents. You may submit any one document from each of the following two lists subject to the bank’s confirmation

LIST I (Most recent/ recent photo identification documents)
1. Passport (a necessity for NRI)
2. PAN Card, Government ID Badge
3. Driving Permit with photograph
4. Voter’s Identity Badge
5. Identity Card/ Validation from employer
6. Letter from recognized public establishment or public servant validating the identity (photo) of customer.
7. Confirmation letter from employer / other Bank verifying therein
picture of the customer together with other things.
8. Some other credentials with picture evidencing identity of the applicant/s acceptable to the bank.

For wedded woman, certification of identity with her maiden name, if backed with a verified true duplicate of marriage authentication is acceptable as valid identity certification.

LIST II (Current / recent credentials showing address proof)
1. Passport
2. Telephone Statement, Electricity Bill, Ration Card
3. Driving Permit with address, Voters’ Identity Card
4. Bank account statement (with address)
5. Letter from employer / Any detail of communication issued by any authority of Central / State Government or local body showing residential address
6. Income / Wealth Tax assessment order (with address)
7. Any documentary evidence in support of residential address acceptable
to the Bank
8. In conditions of married women address proof of the husband is satisfactory

Bank of Baroda is one of the excellent banks in India to apply for a bank account. Remember to prepare and pass up all demands when opening a bank account to have a quick and smooth processing of your application.

When it comes to finding practical tips investing in rental property, many people just don’t look beyond buying a cheap property. There is so much more to investing than just purchasing a low-priced house. It is possible to generate profits using many other options.

The key to successful real estate investing is to generate more profit than you spent acquiring the property. Landlords all over the country have varying ideas about the best ways to boost profits and are always seeking new tips investing in rental property to keep their profit margins growing.

It is possible to find properties that are being sold below their true value. The owner may be motivated to sell quickly or the home might be in foreclosure or perhaps the owner doesn’t realize the true value of the home and is selling for a low price.

No matter the reason, finding and buying properties that are under-valued can be an effective way to build profit quickly. Once you buy the home, you have the option of having the home re-valued by your bank or lender to assess it true security value or you could on-sell the property to realize profits quickly.

Finding positively geared rental properties isn’t always easy, but it is possible to find homes that generate more rental income than it costs to service the mortgage, taxes and maintenance costs.

While most investing advice includes the traditional ‘buy low, sell high’ philosophy, true tips investing in rental property should always include finding ways to profit without necessarily selling the property. When your rental income is higher than the associated costs, you create profit in the form of cash flow.

Regardless of what your property is worth right now, there are always smart ways to increase the value. Fresh, neutral-coloured paint throughout the home and updated floor coverings can give an instant lift to any house.

Clean, tidy gardens with neatly pruned back plants and shrubs can make yards appear bigger. New window coverings can help to make rooms look bigger and fresher.

These are simple tips investing in rental property that can help raise your investment property values up to 20% quickly. Just be careful to spend less money than you made on the new value you create.

Converting an unused formal dining area into an extra bedroom could see an extra 0 per month in rental income and potentially an extra 20% increase in the value of your rental property.

One of the reasons many investors turn to rental properties is to generate rental income. Unfortunately, too many landlords don’t stay in touch with rent increases in their area and might be under-charging their tenants.

If this is your case, make an effort to learn what the correct rental yield should be on your property and raise rents accordingly. It is possible to raise rents by or per month without losing a tenant if you’re careful to research what comparable homes in the area are receiving in rent.

If you’re already charging full rent for your property, then you could consider adding a little value to the property in exchange for charging higher rent. An example of this is negotiating with the existing tenant for a new dishwasher or air conditioning unit in exchange for an extra – per week in rent.

There are plenty of tips investing in rental property to maximize your overall profits, but it’s important you learn to mix and match strategies to suit your overall investing goals.

Teo Zhenjie has been showing landlords how to manage their tenants and rental property effectively on Propertydo http://www.propertydo.com/ – To learn more important tips on tips investing in rental property, visit his website today for step-by-step real estate guides, free resources and forms.

A Systematic Investment Plan (SIP) lets you invest in small amounts in mutual fund on a regular basis. It gives you a lot of flexibility and is a very convenient way of building a large corpus over a period time. In mutual fund terminology, SIP allows the investors to invest a fixed amount every month or quarter for purchasing additional units of the scheme at NAV based prices.

Also, your investments benefit from rupee-cost averaging. Let us explain it. If you invest an equal amount of money every month in a mutual fund, you are engaging in rupee-cost averaging. Share prices change from day to day, so the set amount of money you invest buys different amounts of shares every time. When prices are high, NAV is high – so you get less. And when prices are low, NAV is low – so you get more. In the end, if you were to buy all units at once you risk getting less your money. If you are lucky enough, you would get more. But for that you would need to be an expert. So, in the interest of an average investor, a SIP ensures that the chances of losing out o an investment are spread out and thus minimized.

Let’s take an example. Suppose an investor Rs. 1000 under the Systematic Investment Plan on a monthly basis. Using the SIP strategy the investor can reduce his average cost per unit. The investor gets the advantage of getting more units when the market has turned downwards.

An investor can invest a fixed amount every month for at least 6 months or more through post-dated cheques or through auto debit facility in select centers. Investors are adviced to indicate their choice on their application form in the box provided for the purpose. The post-dated cheuqes should be dated the 5th/ 15th/ 25 of every month. This will make it easy for you to keep a track of your regular contributions 

Management of the fund by the professionals or experts is one of the key advantages of investing through a mutual fund. They regularly carry out extensive research – on the company, the industry and the economy – thus ensuring informed investment. 

Secondly, they regularly track the market. Thus for many of us who do not have the desired expertise and are too busy with our vocation to devote sufficient time and effort to investing in equity, mutual funds offer an attractive alternative. 

Another advantage of investing through mutual funds is that even with small amounts we are able to enjoy the benefits of diversification. Huge amounts would be required for an individual to achieve the desired diversification, which would not be possible for many of us. 

Diversification reduces the overall impact on the returns from a portfolio, on account of a loss in a particular company/sector.

The mutual fund industry is well regulated both by SEBI (Securities and Exchange Board of India) and AMFI (Association of Mutual Funds in India). They have, over the years, introduced regulations, which ensure smooth and transparent functioning of the mutual funds industry.

This makes it safer and convenient for investors to invest through the mutual funds.

One of the biggest difficulties in equity investing is WHEN to invest, apart from the other big question WHERE to invest. While, investing in a mutual fund solves the issue of ‘where’ to invest, SIP helps us to overcome the problem of ‘when.’

SIP is a disciplined investing irrespective of the state of the market. It thus makes the market timing totally irrelevant. And today when the markets are high, it may not be prudent to commit large sums at one go.

With the next 2-3 years looking good from Indian economy point of view, one can expect handsome returns through’ regular investing.

Mutual funds allow us to invest very small amounts (Rs 500-Rs 1,000) in SIP, as against larger one-time investment required, if we were to buy directly from the market. This makes investing easier as it does not strain our monthly finances. It, therefore, becomes an ideal investment option for a small-time investor, who would otherwise not be able to enjoy the benefits of investing in the equity market.

In SIP we are investing a fixed amount regularly. Therefore, we end up buying more number of units when the markets are down and NAV is low and less number of units when the markets are up and the NAV is high. This is called rupee-cost averaging.

Generally, we would stay away from buying when the markets are down. We generally tend to invest when the markets are rising. SIP works as a good discipline as it forces us to buy even when the markets are low, which actually is the best time to buy

The investments we make are ultimately for some objectives such as to buy a house, children’s education, marriage etc. And many of them require a huge one-time investment.

Retail banks are financial centers that cater to the needs of clients and the low budget traders or businessmen. These banks provide assistance related to money matters to individual clients plus store their hard earned revenues. The retail banks are usually concerned with loans and mortgages, saving and checking accounts, deposit certificates and credit cards etc. Banks can be profitable or non-profitable but usually retail banks are profitable as banking is a business in itself.

US retail banks provide its customers several different types of retail offers. A few among these banks also deal in investment banking and provide its customers with monetary assistance in the form of brokerage accounts, fiscal management and also provide retirement plans.

These banks provide money to the loan applicants by taking money from the accounts of other customers. These loans then have interest on them and some of this interest is given on the deposited money while the rest is the bank’s profit. This is how money regulates in the community. The banks also regulate money among the different classes of people and the government.

But the US retail bank is a whole institution in itself and its functioning is not nearly as easy as it seems to be. There are several kinds of retail banks which are designated with not only a separate domain name but also has a distinct function. Some of the kinds of these banks, are given below:

o Private Banks: This type of retail banks cater to the needs of aristocracy and big business proprietors. Although these type of banks cater to the needs of the cream of the society and is often debated upon as being a distinct branch but still according to its function it falls under this category.

Initially, the minimum amount to start an account with the private retail banks was a hefty figure of 1million dollars, however, with the growing fame, it has lowered this amount to a quarter of what it was initially.

o Commercial Banks: Initially commercial as well as the investment banking institutions fall under this category. It was only after the Great Depression that the US’s Congress put a restriction on investment banks to work only with the first house market. This type of retail bank deals with sponsorships to and from the A-class establishments and businesses.

o Community Development Banks: These kinds of banks look after the needs of the general public and provides them with loans and financial assistance.

o Ethical Banks: The kind of banks which deal in social accountable earnings and function on fair terms and conditions are commonly referred as ethical banks.

o Offshore Banks: Offshore banks are the type of retail banks which offer the minimum interest rates and have a very small number of rules and regulations. They are usually private.

I have just had an exciting couple of days searching for something that now appears not to exist.

I cannot find – and believe me I have looked – anything, anywhere that allows me to compare investment returns.

Before I tell you more about my search and the lack of comparison web sites, magazines, books or any other useful reference point on investment return comparisons I need to inform you that the gap that has appeared will soon be filled as I am now happily planning to build and launch such a site.

My search started when I attended two presentations in the space of two days, both by people looking to take on and manage customer’s investment money. Both are established “investment” businesses, one is a discretionary manager, the other an independent adviser recommending other people’s funds through model portfolios.

Both demonstrated their track records in their presentations, one showing how they had produced 8% per year for the past five years, the other 9% per year for the past five years. The former had done so with minimal volatility and fluctuation from year to year (even in 2008 they had produced +4%), the other had produced massive fluctuations from year to year ranging from -17% in one year to +22% in another.

It struck me that they were both pitching to the same type of audience and yet their investment returns whilst almost identical were in other ways completely different.

It is possible at any moment in time to take a snap shot and to compare different options, funds, portfolios, services and so on to see what they would have produced. But if you think about it logically, on its own what good is this? You can mix into this comparison other factors such as volatility and costs and this helps, but again the snap shot position presents a problem.

What I wanted to find therefore was an investment comparison web site that properly compared investment options and possibilities, so if a person suddenly finds they have £100,000 to invest they could really judge the best place to put their money based on sound mathematically constructed principles, that extended beyond the snap shot of framing the comparison at one point in time.

I discussed this with a couple of key people within the investment world who were able to confirm the idea that such a set of comparison principles could be constructed. I then set about searching for such a site and as of the time of writing could not find one.

What I did find and I urge you the reader to be very wary if you find, or worse use or rely on, any such comparison basis: lots of sites and publications that provide comparative historical fund price performance and compare the returns from these. This is dangerous because it is likely, in my view, to be a snapshot which even very small statistical anomalies can change the framework very quickly.

We need better comparison tools so investors can make better judgements on the variable worth of a range of investment funds and portfolios. My aim is to build and construct a comparison service of this sort and to make it into a web site that you can use. In the meantime I suggest investors find an individual investment adviser who is independent who can do this for you.

Bank of America is one of the top largest banks in North America. It has been ranked No. 1 in The Banker Magazine Top 1000 World Banks ranking. The bank was named best consumer Internet bank in the United States by Global Finance magazine as part of its “World’s Best Internet Banks” competition. In addition, Global Finance magazine gave Bank of America awards for the best information security initiatives, best bill pay and presentment, and best online consumer credit in North America.

The Royal Bank of Canada (RBC) is the largest financial institution in Canada and among the largest banks in North America. It was founded as the Merchants Bank, in Halifax, in 1864. RBC provides a broad range of services such as personal and commercial banking, wealth management services, insurance, corporate and investment banking and transaction processing services on a global basis. RBC is listed on the 2009-2010 Dow Jones Sustainability World Index and the DJSI North American Index. It is also the safest bank in North America, according to the Global Finance magazine (2010).

Wells Fargo & Company is a diversified financial services company and one of the leading banks in North America. It provides a wide range of financial services including banking, insurance, investments, mortgage, consumer and commercial finance through across North America and internationally. The bank was named Best Consumer Internet Bank and Best Corporate/Institutional Internet Bank in North America by Global Finance in 2010.

JPMorgan Chase is a leading global financial services firm and one of the oldest financial institutions in the US. The bank is a leader in investment banking, financial services for consumers, small business and commercial banking, financial transaction processing, asset management and private equity.

Please visit the relevant guide for more information on the ranking of banks.