Mutual Funds Information

A sophisticated guide to today’s hottest investment vehicle— exchange traded funds

The ETF Strategist is aimed primarily at investment advisers and sophisticated retail investors who are interested in using exchange traded funds, or using them more effectively than they already do.

Compared with mutual funds, ETFs can offer a better way to diversify risk, target specific sectors or countries, avoid style drift, and maintain a specific asset allocation that might include real estate or commodities.

Previous ETF books have focused on their mechanics, regulation, and other basic information. But The ETF Strategist goes much further, showing how ETFs can improve many aspects of an overall investment strategy. It explores advanced concepts such as alphabeta separation, which basically means “don’t confuse skill with risk.” And it shows how different ETFs can be combined to find the ideal balance of risk and potential reward.

Author: Russ Koesterich

Hardcover: 
272 pages

Company: Portfolio Hardcover 

(2008-05-29)

(2008-05-29)

ISBN: 1591842077

List Price: $39.95
Amazon Price: $22.90

Used Price: $250.00

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Loads are the most talked about fees that mutual funds charge. A “load” on a mutual fund is just another way of saying that the fund charges a sales commission for purchase, sale, or both. There are funds that charge loads and there are funds that do not charge loads (known as “load funds” and “no load funds” respectively).

Front-end loads are sales commissions that are paid up front at the time of your purchase. So, if you give a fund a $10,000 investment and it charges a front-end load of 5%, then the fund will take 5% of your investment (that’s $500) and pocket it right away. Only what is left over after the load has been deducted will be invested into the fund (in this example, only $9,500 is invested in the fund from your initial $10,000 investment)

Back-end loads charge their sales commissions when you sell (or “redeem”) your shares. So, when you go to redeem your shares in a fund with a back-end load you will end up receiving whatever money the shares are worth minus the sales commission.

Mutual funds charge management fees in order to pay for the management services used to run the fund. In other words, these fees are used to pay the salaries of the fund’s managers and analysts. Management fees usually do not amount to more than one percent of the fund’s assets, and they are significantly lower for passively-managed funds, such as index funds, than for actively-managed ones. You should remember that a high management fee in no way guarantees a more skilful management team.

Front loads can be reduced if you are investing or planning to invest a certain amount of money. The load reduction schedules are called “break-points.” For example, with most fund companies if you are investing over $100,000 or plan to within the next 13 months, you will get a 1% reduction on the front load. The more you invest, the greater the reduction in the load. For some fund companies the break-point reduction begins at $50,000 over 13 months, and with many funds, if you invest over $2 million there is no front load.

If you do not have $50,000 or $100,000 to invest over the next 13 months, you can still earn a reduction on the front load, through “rights of accumulation.” Under accumulation rules you will receive fee reductions on the front load when your total investments with one fund family have grown past the break points. Therefore, if you only have $20,000 to invest today, that’s OK, someday soon it will grow past the $50,000 or $100,000 initial break-point and you will be eligible for the load discount on your further investments.

The turnover ratio for a mutual fund can provide you with useful information about how expensive a fund is and how it is managed. Turnover ratios measure the amount of trading activity in the fund’s portfolio. They are calculated by taking all of the fund’s sales for a specified period of time (usually one year) and dividing by the fund’s total assets. This number tells you how much the fund’s portfolio has changed.

You probably will want to exercise caution when investing in a fund with a high turnover ratio. High turnover means that the fund’s manager is buying and selling very often, and, since every sale and every purchase involves a commission, this means that funds with high turnover ratios often have high expenses. Some experts recommend focusing on funds whose turnover ratio is less than 50%.

Copyright 2006 Michael Saville

Michael Saville has over twenty five years experience in providing finance and investment advice. He has written a free five-part short course on ‘no load mutual funds‘ which is available at http://www.buy-mutual-funds.com

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If you look at the leading 10 Exchange Traded Funds so far this year, you will see many of these funds are Emerging Market Funds. In general these funds are doing better then US Funds.

In spite of there strong performance, all Emerging Market Funds are not the same. You need to see what the underlying Equities are that make up these funds, and then look for trends.

The Foreign ETFs that are invested more in manufacturing are doing the best in this area now. This is a shift from what we have seen in the past. The Emerging market ETFs that previously have had the best performance were those that have invested in companies that income was based on commodities, especially oil.

Two of the leading emerging market exchange traded funds are iShares MSCI Brazil (EWZ) and iShares FTSE.XINHUA China 25 Index Fund (FXI). These funds are doing well and institutional investors are still showing confidence in these ETFs. This is a trend that has been developing over the last year.

The sector of Emerging Market Funds that now are showing signs of pullback are ETFs that invest in companies based on commodities. These commodities have been primarily oil and gold. Emerging market funds that have invested in this area have headed straight up in the last few years. At this point it looks like these funds are taking a breather.

One up and coming fund is iShares MSCI Japan Index Fund (EWJ). Japans economy is picking up and also giving a boost to other Asian stocks. Institutional investors are showing interest in this fund.

To see the top ten Exchange Traded Funds and also the most popular Exchange Traded Funds, check www.exchangetradedfundinvesting.com.

About The Author
Andy Goldman has been writing articles in the financial sector. He is the publisher of www.exchangetradedfundinvesting.com.

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If you are fed up with early redemption charges and ever increasing mutual fund management fees on top of bad-performing fund managers, read on. There is a quiet revolution going on in the no-load mutual fund industry and you, the individual investor, may benefit from it greatly.

I am referring to Exchange Traded Funds (ETFs), which have been around for years, but have grown tremendously since their inception. There are currently over 100 choices with around $10 billion in assets.

In a nutshell, an ETF is a specific kind of no-load mutual fund that you might consider to be a basket of stocks. ETFs are diversified like mutual funds, only they trade like stocks. They are cheap to trade (as low as $8.00) and don’t hit you with any short-term redemption fees. And they offer investing opportunities across the board.

ETFs track every index under the sun including the S&P 500, the Nasdaq 100, The Russell 2000 and many others. Available through any discount broker, they basically fall into one of three categories: broad-based U.S. indexes, sectors and international.

The have esoteric names such as iShares, StreetTracks, HOLDRs and SPYDRs. The difference is in the index they are tracking and the company marketing them. You will see big name companies offering them, like the American Stock Exchange, Barclay’s Global Investors, Vanguard, and State Street Global Investors.

In my newsletter I track the currently most appropriate ETFs for you to consider. For more detailed information you can visit these web sites:

• http://www.nasdaq.com

• http://www.amex.com

• http://www.ishares.com

In addition to inexpensive trades and no short-term redemption fees, how else can ETFs save you money vs. no load mutual funds? One way is on their annual management fees. That fee for ETFs is in the area of 0.45% vs. 1.5% on average for no load mutual funds. The fees charged by discount broker are so low they almost can be disregarded, usually less than 0.1% of the transaction.

For example, I have used ETFs for some managed account clients during my last Buy cycle, which started on 4/29/03, and paid $27 for a $28,000 order and that wasn’t even with the cheapest discount broker.

So, if these ETFs are so great, why hasn’t your broker or financial planner recommended them to you? Simple! Brokers, and those advisors working on commissions, don’t make money on ETFs; no commissions up front or hidden on the back end. It’s simply not in their interest to promote them.

With all the positives for the investor, there is one disadvantage, which may not be applicable to you unless you are a hot shot no load mutual fund picker. It is that in any given economic environment really super performing mutual funds can outperform the indexes, but an ETF can never outperform the index it’s tied to. You would need to look at your own investment record to know whether this is a downside for you.

Here’s a real life example from my advisory practice. My trend tracking indicator signaled a Buy on 4/29/03. Based on my momentum indicators I chose 5 no load mutual funds and 4 ETFs. Over the following 3 months my ETFs gained anywhere from +10.02% to +22.36%, while my no load mutual funds gained from +9.15% to +36.35%. If you’re fortunate enough to make a superior selection you will outperform an ETF. Of course, that presumes you picked a very successful fund as compared to only a moderately successful ETF.

A word of caution! Just because ETFs are cheap and easy to buy doesn’t mean they will guarantee you a profit. You can lose money with them just as easily as you do with no-load mutual funds. You still need to make sure you have a disciplined methodology in place to help you get into and out of the market. If you don’t, you’re gambling no matter what you invest in.

Having gotten the disclaimer out of the way, hopefully these insights into ETFs will broaden your perspective on ways you can prosper in your investments.

© Ulli G. Niemann

About The Author

Ulli Niemann is an investment advisor and has been writing about objective, methodical approaches to investing for over 10 years. He eluded the bear market of 2000 and has helped countless people make better investment decisions. To find out more about his approach and his FREE Newsletter, please visit: www.successful-investment.com; ulli@successful-investment.com

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The government requires unclaimed money be turned over to state. Now they are passing bills to spend this money that may belong to you! Are they legalizing theft

Unclaimed money accounts in the United States total over $25 BILLION dollars. The money ends up in these account do to the governments “escheat laws” requiring institutions such as banks to turn over funds from dormant bank accounts, uncashed checks, unused gift cards, etc. States are now passing bills to spend the money from these Unclaimed Property Trust Funds.

These funds are owed to millions of Americans and instead of making any sizable effort to contact the rightful owners, the state is now proposing to spend this money to handle there own budget problems.

States are passing bills allowing them to use the missing money funds. One such case is a Bill was passed last year in Arkansas. The Bill was created impart to allow the State to transfer up to $15,000,000 of funds from the “Unclaimed Property Proceeds Trust Fund” to the States General Improvement Fund. The subtitle of this Bill states the funds are to be used “to provide additional funds for the State budget”.

Some states such as Indiana and Iowa require that 60% of the money from unused expired gift certificates be sent to the State and 40% remain for the retailer. George Delta, from the counsel to the Incentive Marketing Association, stated “States require businesses to give them some type of periodic report of the amount of unclaimed property they are holding. This allows the state to monitor this potential source of income.”

With the states experiencing such great budget benefits from the unclaimed property funds, they have little incentive to locate the rightful owners of this money.

In the state of California the lost funds have reached over $5 billion and it is estimated 1 in 5 have unclaimed money. How hard is it to find Ryan Seacrest, Reese Witherspoon, Julia Roberts, Kate Hudson and Benicio Del Toro? They are all owed money from California’s state database. Microsoft is owed over $25,000!!! California’s Unclaimed Property Trust Funds is likely to be a target piggy bank for the CA Governor to use to assist with the states budget issues.

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Unsecured loans UK are offered by almost all the banks, financial institutions and building societies. Nowadays the popularity of unsecured loan has seen tremendous increase in the UK. The reason is that, these loans can be used for any purpose and secondly, no security is required to offer against the loan.

The amount which the person is willing to borrow varies according to his needs. And the repayment period of unsecured loans UK basically depends on the amount and the purpose of the loan. Larger the loan amount, longer is the repayment period, and vice versa.

Interest rate is the common factor which is taken into account while availing an unsecured loan in the UK. Interest rate, technically in the financial market, forms a part of annual percentage rate (APR). Annual percentage rate can be termed as sum of interest rate and cost of loan. It is recommended to compare APR of all the sources of funds available, in order to know how competitive the source of finance is. The person easily can get the APR, through sending a request to lender for the quotation. This loan quotation will give you, an idea of the cost involved in availing loan. Or in other words how much a loan will cost you. After knowing this fact, it will be easy for you to decide the loan deal that suits you the best. Make sure that you choose loan deal which is easy for you to pay till the last repayment installment.

Even though, the low annual percentage rate makes the loan cheaper, but another thing which needs attention is the small print of a loan. A small print of a loan refers to the terms and conditions of a loan. Even a single unfavorable term, in the loan can affect the person’s financial status adversely. The clauses like penalties of early repayments or late payments must be clear as making such undesirable payments will increase the cost of the loan. And penalty generally can be two months interest.

Lenders generally offer two types of interest rate, that is, fixed rate of interest and variable rate of interest. In fixed rate of interest, the person pays interest at flat rate regardless of any changes in base rate or market; whereas, in case of variable rate of interest, rate changes as the change in the base rate or market conditions.

People who are facing difficulties in applying for a loan due to their bad credit can also avail unsecured loan UK. But, the condition is that they will be required to pay higher APR as compared to good credit scorers.

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Aspiring for expending your business or starting a new one is no sin if you are suffering from bad credit. You may face some hurdle but with little efforts, a loan is possible in such a case. Bad credit commercial loans are made especially for offering a commercial loan to bad credit borrowers.
Bad credit commercial loans have been designed for a smooth loan offer to people who are facing arrears, defaults and CCJs. The loan is available also to applicants who have filed for bankruptcy. As bad credit borrowers are usually denied a loan because of risks, bad credit commercial loans come as a relief to them.

Bad credit commercial loans are available in secured and unsecured versions for the benefits of bad credit people. The loan thus suits all type of bad credit borrowers. Secured bad credit commercial loans are suitable for availing greater amount at lower interest rate. The borrower is required to place any of his property which has considerable amount of equity to the lender as collateral. Lenders can provide a secured bad credit commercial loan anywhere in the range of

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No load mutual funds are mutual funds whose shares are sold without a commission or sales charge. The reason for this is that the shares are distributed directly by the investment company, instead of going through a secondary party. This is the opposite of a load fund, which charges a commission upon the initial purchase at the time of sale.

Since there is no cost for you to enter a no-load fund, all of your money is working for you. If you purchase $10,000 worth of a no-load mutual fund, all $10,000 will be invested into the fund. On the other hand, if you buy a load fund that charges a commission of 5% upon purchase, the amount actually invested in the fund is $9,500. If both funds return 10%, the no-load fund would have grown to $11,000 while the loaded fund only rose to $10,450.

The major idea behind a load fund is that you will make up what you paid in commissions with the solid returns that the managers will provide. However, most studies show that loads don’t outperform no-loads.

Most load mutual funds are sold through brokerage houses, financial planners, and people known as “Registered Representatives.” With very few exceptions, most of these people operate on the basis of selling as many fund shares as possible. Their commissions are collected up front, as a back end charge, or both. Whether you make money or lose it isn’t their primary concern. What matters most to these folks is how often you buy (and generate new commissions for them).

No load funds have traditionally been marketed directly by the mutual fund companies themselves. But today, more and more funds are being offered through discount houses like Fidelity, Schwab, and a host of others. The advantage to this is that you have an unlimited choice of mutual funds in one place. You don’t have to open a separate account for each mutual fund family that you purchase.

Most fee based investment advisors have independent relationships with the major discount firms. They’re able to offer clients just about any no load mutual fund that is available. They receive no commissions from the firm and only get paid by the client according to a pre-determined fee arrangement. Under this type of arrangement, there’s no hidden agenda to try to sell you a particular mutual fund in order to earn a larger commission.

It is best to stick with no-load or low-load funds, but they are becoming more difficult to distinguish from heavily loaded funds. The use of high front-end loads has declined, and funds are now turning to other kinds of charges. Some mutual funds sold by brokerage firms, for example, have lowered their front-end loads to 5%, and others have introduced back-end loads (deferred sales charges), which are sales commissions paid when exiting the fund. In both instances, the load is often accompanied by annual charges.

On the other hand, some no-load funds have found that to compete, they must market themselves much more aggressively. To do so, they have introduced charges of their own.

The result has been the introduction of low loads, redemption fees, and annual charges. Low loads–up to 3%–are sometimes added instead of the annual charges. In addition, some funds have instituted a charge for investing or withdrawing money.

Redemption fees work like back-end loads: You pay a percentage of the value of your fund when you get out. Loads are on the amount you have invested, while redemption fees are calculated against the value of your fund assets. Some funds have sliding scale redemption fees, so that the longer you remain invested, the lower the charge when you leave. Some funds use redemption fees to discourage short-term trading, a policy that is designed to protect longer-term investors. These funds usually have redemption fees that disappear after six months.

Probably the most confusing charge is the annual charge, the 12b-1 plan. The adoption of a 12b-1 plan by a fund permits the adviser to use fund assets to pay for distribution costs, including advertising, distribution of fund literature such as prospectuses and annual reports, and sales commissions paid to brokers. Some funds use 12b-1 plans as masked load charges: They levy very high rates on the fund and use the money to pay brokers to sell the fund. Since the charge is annual and based on the value of the investment, this can result in a total cost to a long-term investor that exceeds a high up-front sales load. A fee table is required in all prospectuses to clarify the impact of a 12b-1 plan and other charges.

The fee table makes the comparison of total expenses among funds easier. Selecting a fund based solely on expenses, including loads and charges, will not give you optimal results, but avoiding funds with high expenses and unnecessary charges is important for long-term performance.

Copyright 2006 Michael Saville

Michael Saville has over twenty five years experience in providing finance and investment advice. He has written a free five-part short course on ‘no load mutual funds’ which is available at http://www.buy-mutual-funds.com

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Has misfortune knocked at your door! No worries please. Instant loans are knocking otherwise. It is acting as the saviour and helps in shedding of your unwanted worries.

It can happen to anybody irrespective of how good you are at managing your accounts. A mixed bag of bad luck can leave you glaring at your depleting bank balance because a pending medical bill, tuition fees, grocery bills, and an unending list of expenses are waiting to be repaid. As they say opportunity knocks at everybody’s door. Instant loans provide the right opportunity.

Rightly, some questions are left to be answered.

What are instant loans?
Instant loans are short term unsecured loans. No collateral is required; that makes it easily accessible to anyone. Tenants or non homeowners are provided with the opportunity to procure instant loans to meet their pending bills.

Are instant loans readily available?
Obviously yes! Since no collateral is required, no paper work is required, therefore the time taken for disbursal of the loan is very less. In fact, the loan amount can be disbursed within 24 to 48 hours. Online processing also helps in its faster procurement.

What is the range of loan amount?
Instant loans are always needed to meet small pending bills. Therefore the loan amount is in the range of

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Special events are one of the most effective ways to raise funds
for your organization, increase your donor bases, and get
valuable publicity for the work of your nonprofit organization.
If done right, if done wrong, your special events won’t provide
the funds you seek, and will in fact hurt your organization
because of the negative word-of-mouth advertising your
organization will receive.

Therefore, in doing your special events failure is a luxury your
organization quite simply can’t afford. Here are some steps you
can take to help insure that your special events are done right,
so that your organization gets all the benefits that good special
events offer.

1. Select a special event chairman for your event. This position
should not be held by your board chairman, board members, or your
executive director. Because, first these people already have
other responsibilities, and second because in selecting your
event chairman what you should want to do is to supplement your
existing people resources not saddle them with more
responsibilities. So don’t hesitate to go outside of your
organization to find this person, if needed.

2. Carefully plan your special event, and one of your key
planning tools will be your Event Master Plan, which will cover
the kind of event you’ll have, when it will be held, and where it
will be held. Other important plans you will need are: A Budget
Plan; A Funding Plan; A Publicity Plan; A Donor Recognition Plan;
A Site Logistics Plan; and a Disaster Plan.

3. Develop an event’s timeline to keep your special event on
course. For smaller special events you need between 3 to 6 months
lead time. And for larger special events you will need between 6
to 9 months lead time, to do your special event right. So be sure
you give yourself plenty of time.

4. Set up a special event’s committee, as well as all the needed
subcommittees. Such committees will include ticket sales
committees, a gift solicitation committee, a publicity committee,
and others. Because, all fundraising is a people intensive
activity and this is nowhere more so than in doing special
events, and you will need lots of people to help make your
special event a success.

5. Prepare as many of the documents you will need to do your
special event successfully even before you need them, in the form
of template documents so that keep your special event on track.
Some of the many kinds of document you’ll need are an event case
statement; gift solicitation letters, publicity releases,
volunteer’s worker kits, event signs, and numerous other
documents.

6. Hold a full dress rehearsal of your special event with all
your key player involved, and walk through each step of your
event. So that all directly involved know exactly what their
respective role is, and just where they fit into the overall
process. Moreover, if your event involves some kind of talk
presentations be sure to provide scripts to everyone who talks,
and be sure to set a time limit on those who will be speaking so
that you start and finish on time.

7. Do your special event being sure that if you accomplish
nothing else that at least everyone has a good time. If they
don’t they won’t speak well of your organization nor attend
future special events. Too try to earn a reasonable profit of at
least 50% or better on your event after all cost are subtracted.
On key to earning a reasonable profit is to get as many of the
materials you need donated, and to obtain cash gifts from local
businesses and others, which will be added to the overall revenue
produced by your event.

Now to successfully do special events will require time and
effort on your part, but the value of your special event and the
benefits your organization will receive will far out weight the
time and effort involved. Because your event will allow you to
raise funding, increase your donor bases, and provide valuable
publicity for the work that you do. Thus special events should be
regular part of your organizations fundraising efforts and
revenue sources.

Berwyn J. Kemp is a fundraising consultant who helps nonprofit
organizations obtain funding. For full details on his funding
products, or to read more of his re-printable articles you can
visit: http://www.berwynkemp55.tripod.com

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