There’s an Investment Market for Hurricanes?
The answer is yes. There is an investment market for hurricanes but it’s not a market that the average stock market investor knows much about. It’s called the futures market. This market is found in Chicago at the CME or Chicago Mercantile Exchange where everything from gold contracts to interest rate contracts change hands.
Hurricanes are traded in the form of futures contracts along with other weather products. Although you can’t buy or sell a hurricane, there are other reasons that investors invest money in to these monster storms.
Don’t know much about a futures contract and you can’t think of any possible way that investors could possibly trade a hurricane? Keep reading. We’re going to learn everything we need to know about these futures contracts.
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Is It Time To Sell Your Gold?
Rising towards $2,000 during trading on Tuesday, investors may have been tempted to sell gold after the drastic 10% correction this morning. Gold is a commodity, but trades like a currency. Minor news events and people’s speculations can thus make it quite volatile.
If you invest in gold as a hedge, these fluctuations shouldn’t sway your convictions about the precious metal. The experts say the fundamentals are still there, and that nothing has changed. Maybe you don’t care about the fundamentals since you don’t believe in fiat currency and are willing to hold a hard asset no matter what.
Many people also believe in gold because of the status it provides. How many people have you seen adorned in gold – watches, necklaces, earrings, and rings. Even after those desires to impress fade, the gold is still worth something and people forget you can get cash for gold. Cash in your pocket is much better than jewelry collecting dust in your drawers.
If you listen to someone who has the gold bug, every time is always the right time to catch the “Midas Touch” and turn your fake assets into real ones. The government is crumbling and on the verge of failure….
As Forbes notes, gold follows a “Buy the Rumor Sell the Fact” pattern. Fear can drive the commodity’s price, but fulfilling loans and obligations requires liquid currency. Paying off liabilities means selling assets like gold.
No matter your reason for holding the previous metal, remember prices are based not on earnings or dividends, but what the person next to you is willing to pay.
Investing Overload: Reflections of a Freak-out
Returning the “Credit where credit is due”. The inspiration for this article came from Oblivious Investor, which in turn, came from ‘nisiprius’.
It’s time for me to take a deep breath and step back from monitoring the market. After last week’s roller coaster, I’m too drained to worry about what will happen this week.
If you’ve ever played Roulette, those precipitous gyrations reminded me of betting on RED or BLACK. A rather simplistic choice with devastating consequences, you either win or loss.
Being a rather conservative investor, I’m of the “Go Long – Go Vanguard” approach through low-cost indexing; however, it’s undeniably hard to resist the mountains of financial products and tactics available.
Chatting with a friend who works in finance, we reviewed the different option strategies for hedging against short term losses. Even as a Chartered Financial Analyst (CFA), he admitted having a limited grasp on the actual execution of these theories. Both of us have resolved to spend the time to learn more about these after our respective obligations (Him: GMAT & marathon, Me: GRE & half-marathon).
From there it was a slippery slope.
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EZ IPO Profits
People have been following the debt-ceiling debate for the past few weeks, but my attention was elsewhere. It’s fascinating what information garners headlines while others get brushed aside.
Four mainstreet brands have had initial public offerings within the past two weeks. I also looked at two other, recent name-brand offers for the purpose of this article.
Teavana (TEA) on July 28th- Dunkin’ Brands (DNKN) on July 27th
- Zillow (Z) on July 20th
- Skull Candy (SKUL) on July 20th
- Pandora (P) on June 15th
and of course…
- LinkedIn (LNKD) on May 19th
The first day action on these offerings was perplexing to say the least. From the pricing range – to the adjusted price- to the open, these stocks seemed to jump by leaps and bounds. Outside of Skull Candy, every other company came out of the gate 25% higher (or more) than the final IPO price.
Dividend Investing In an Uncertain Economic Climate
The economic recovery in the United States is hitting a major wall of resistance. In early 2010, the recovery seemed to be doing quite well. Unemployment was falling, retail sales were increasing, and economic growth as measured by GDP was expanding. It all seemed so rosy.
But when the European Debt Crisis fully erupted in the spring, the global economic recovery began to show signs of faltering. Then in June and July, key economic data out of the United States disappointed to the downside quite strongly. By mid-June it became very clear the U.S. recovery was in trouble, and in late July Federal Reserve Chairman Ben Bernanke basically sealed the deal and removed all doubt from the market when he stated before Congress that the economic outlook for the United States in the 2nd half of 2010 is “unusually uncertain.” It was official—the Federal Reserve had no clue how bad things were going to get.
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Hiring a Fee-Only Advisor for Major Life Changes
At my age, it doesn’t make sense to pursue a full-time advisor. First off, asset management tends to be for those with substantial holdings, and secondly, I’m pretty “healthy” financially as is. If you think about it in relation to doctor visits, it will make a lot of sense.
When you’re young, you don’t go any more than necessary. Occasionally you’ll stroll in for a check-up to make sure everything’s okay, but that’s about it. As you age, and you’re financial health becomes more complicated, it may make sense to go with something more regular.
There are those special occasions though when the advice of a professional is recommended – one of which is marriage! I’ve been scouting out resources online for newlyweds, but have been thoroughly disappointed with the results.
“ELIMINATE DEBT”
“START BUDGETING”
“SAVE MONEY”
and the worst…
“PAY OFF THAT HONEYMOON!” Continue reading “Hiring a Fee-Only Advisor for Major Life Changes” »
