Investments « 1st Media Finance

January 10, 2011

Best Short Term Investments

You may have some cash to spare for a little while and may want to put it to work. If you are looking for the best short term investments for that money, you may want to look at the following options. It may not give you the best investment rates, but it will give you a positive return.

So here is the skinny on short term investments. If you only have a limited time to place money somewhere, you want to make sure you put it in an asset class that won’t lose money. That is because you won’t have time to recover should your investments go down. Here are some of the best short term investments you can look at that probably won’t lose money in a short period of time.

The first and most obvious place is a savings account. You won’t lose money because the FDIC insures it up to $100k. They may even give you a small interest rate, but it may just be enough to cover inflation. So you won’t really make money, but you won’t lose it either.

Then you have a investments like CD’s, certificate of deposits. These give better rates than savings accounts, but it’s less liquid because your money get’s tied up for a period of time.

Some good stocks to invest in will be large cap stocks. These stocks are good for short term investments because they aren’t as volatile as small cap stocks. The share prices stay pretty stable and will keep you from losing a lot of money. But you may even make pretty decent rates if the economy is doing well. Depending on how long your short term period is, you may even be able to get some dividend income out of this category of stocks. As always, get professional advice before investing any money.

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November 23, 2010

Title small cap fund

Filed under: Financial Tips,Investments — Tags: mutual fund performance comparison, small cap fund — @ 7:01 pm

For those of you who are interested in investing into the stock market, a small cap fund may be an important component of a well designed financial plan. However, new funds are being introduced each week, and with already several thousand of these funds to choose from, which is the one for you?
To be clear, small cap funds ideally serve a niche in an investment portfolio. Nonetheless, a consideration of some important principles of investing is helpful prior to deciding if a small cap fund is right for your portfolio. First, a well designed portfolio will be diversified among many different types of investments. A well managed mutual fund or exchange traded fund will assist in providing diversification small cap funds generally divide the investments in the portfolio among at least several hundred individual corporations, so this accomplishes diversification among small caps. However, in any given investment period, small cap stocks may outperform other sectors, or they may lag behind other sectors. A wise investment strategy is to balance the composition of one’s portfolio with large cap funds, mid cap funds, and possibly ‘style funds’, which include growth funds, value funds, international stock funds and emerging market funds, among others. A healthy mix of many of these in a portfolio will assure that an investor sees at least a portion of the best returns for any given period.
A second piece of wisdom in investing do not go hunting the small cap fund that has historically performed well. Likewise, one should avoid liquidating funds in one sector of a portfolio to buy shares of a competing fund when that fund is performing well. A mutual fund performance comparison may provide a snapshot of the returns for any financial quarter, but it does nothing to summarize the risks that the fund bears as it continues business, nor does it summarize the accounting assumptions that were made to create such lofty returns. Successful investors have found that the best strategy is to develop a sense of value of the fund in question, buy when prices are advantageous, and maintain discipline to the model investment strategy, particularly when some sectors underperform others. Assuming that one has the wisdom to diversify investments appropriately and to maintain discipline, periods of underperformance for any particular sector will become opportunities to increase one’s holding at a discount relative to an optimally performing sector. Such opportunities can make one a savvy investor.

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November 15, 2010

Looking for the Best IRA Interest Rates?

Filed under: Investments — Tags: best IRA interest rates, interest rates, ira, IRA rates — @ 9:39 pm

Investing your money on IRA is a good way to prepare yourself for retirement. But before you concern yourself with finding the best IRA interest rates, you first need to understand the basics of IRA. First, understand that IRA itself is not an investment but rather a retirement account that holds your investments. Therefore, you also have to be wise when choosing your investments. If you want to get bigger return of investment, you also need to take a bigger risk. If you are unsure how to invest your money, it would be best if you seek advice from an expert.

Now, when it comes to IRA rates, you may want to start your search with the credit unions. Credit unions are non-profit and thus they may be able to offer you better rates. You can find out the rates that they offer by going to your local credit union.

You may also want to try your local banks. First, make a list of the local banks near you. Don’t just focus on the mainstream banks and try the banks in your community as well. You can call the banks you have listed and ask about the IRA interest rates that they offer. Making a list of banks within your community will make it easier for you to compare rates from various financial institutions. Remember that rates may vary from one bank to another. You may also want to try with your bank as well. A bank where you have a good relationship with would most likely give you a better rate as they would like to keep your business.

Trying your options online would also be another good option for you to find the best IRA interest rates. There are a lot of financial institutions that only do business online. You may be able to get a better rate with them considering that they have lower operating costs compared to financial institutions within your community. Aside from interest rate, you should also decide on the term of your investment. Decide whether you would want a short term investment or a long term investment.

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