Archive for January 3rd, 2010

About Independent Brokerage Firms

Sunday, January 3rd, 2010

Today, more and more traditional investment brokers are making the transition from charging one-time commissions to levying annual fees for managing their clients’ assets. Consequently, small investors are being forced to shun them and instead turn to independent brokers for their investment needs. To act as an independent broker, a professional has to register as an investment advisor and sign up with a big brokerage house, which in turn provides the necessary operational support.

On the other hand, the rising costliness of the established players has wedged open a low-end market for newcomers. More and more small investors are looking to these comparatively cheap alternate service providers to take over responsibility for their portfolios. That is the reason why so many are doing well as independent brokers. And this business is gradually coming into its own as more and more brokerage professionals are being lured into it.

Many investors prefer independent brokers over the traditional brokerages, since there is little chance of partiality to any particular firm and, in turn, judgment clouded by personal motives. Independent firms pay fees for services provided by their parent firms. The parent firms do not begrudge operation of these independent players, on the ground that the latter’s fee contributions are accounting for an ever-growing share in the former’s revenues.

The independent brokers have also now begun cutting loose from their affiliations with big brokerages and managing things on their own. This is because they are averse to losing any revenue to brokerage firms once their line of business acquires credibility. Further, they also want to enjoy the strategic advantage of not being associated with brokerage firms which represent the interests of particular business groups. Look forward to your future while spending more time doing what you like to do. Become an independent broker, and have your own money management enterprise in your home or your own office.

Mutual Funds Buying and Selling Guide

Sunday, January 3rd, 2010

Investors who are either starting out or who have little money to invest can actually take advantage of the expected growth opportunities that billionaires like Warren Buffett see on the horizon. The way to participate in this? Mutual funds. Mutual funds make an excellent way of investment because you have to make just one purchase and you can easily acquire a wide range of investments. They offer an array of benefits and features. It is very easy to buy these funds and it is much easier to sell the same. However, in order to decide about the best funds suitable to you, you will have to do some research and homework. Following is a brief rundown on how to go about it.

Know the basics
Before you go ahead and start investing, you are strongly recommended to first learn the basics of what mutual funds are and how they work. These funds basically refer to a portfolio that can include different types of securities, such as certificates of deposit, bonds, stocks, and others. The majority of these funds have a certain focus.

Investment goals
In order to get the best return out of your investment, you must also be well aware of your financial goals. The goals must be specific. If you know the objectives you want to achieve, it will be very easy for you to decide about the right kind of mutual funds that are most suitable to you. You may like to ask certain questions to yourself. For example, do you want money to purchase a vacation home? Are you planning for retirement and you need money to fund the same? Do you have to pay for your college education? The answers to these specific questions will help you make an accurate decision.

Your overall portfolio
The next thing that you have to do is to look into your overall portfolio and determine how investment in these funds is going to fit there. The basic investment strategy is same here – you don’t have to invest all your money; make sure you have sufficient money available every time not only to meet your regular expenses but also the emergency ones. Find out the exact percentage of your overall assets that you can afford to invest in mutual funds.

Risk
You will also have to determine the amount of risk that you can afford. If you don’t want to go for the risky ventures, you should never invest in aggressive funds. If you do, you will most probably end up having a string of sleepless nights. When it comes to buying and selling of mutual funds, you must also do a thorough research of the market. It will be a nice idea to go through various financial magazines where you can check out the list of these funds rated on the basis of several parameters, such as risk, performance, and others.