This article is a guest post from Mr Jason Holmes. Jason Holmes is a regular writer with Debt Consolidation Care and is also a contributory writer with other financial sites. His expertise is woven around various aspects of the debt industry and with his e-books he tries to impart to people the different situations and simple solutions to get out of difficult situations. Some of his works include e-books like Credit Score The Quintessential Therapy for a Happy Pocket, Take Creditors and Collection Agencies to Small Claims Court and My Story- From Depression To a Smile.

Enjoy the article by Jason Holmes below.

Can investors gain from the economic market in 2010?

The world financial crisis started to show its effects in the middle of 2007 and into 2008. The entire world economy was in depression. Stock markets have crashed and large financial institutions have either collapsed or have been bought out around the entire world. The housing market has also suffered, leading to several foreclosures and evictions.

The financial crisis affected the livelihoods of almost everyone in this inter-connected world. Millions of people lost their jobs leading to increase in unemployment rate and debt problems. The number of debt consolidation companies sprang up in this period. The governments of the wealthiest countries such as USA have had to come up with relief packages to bail out their financial systems.

Causes of world financial crisis

Various factors lead to global financial crisis such as collapse of the US sub-prime mortgage market, growth of the housing bubble, easy credit conditions, predatory lending, increased debt load, incorrect pricing of risk, boom and collapse of the shadow banking system, financial complexity, and commodity bubble.

Can investors gain from current financial market?

It may seem absurd, but investors can gain from current economical market in various ways. Although most investors are too wary to invest in stock market nowadays yet they forget that stock market is likely to recover even if it takes longer than expected. This is the right time to take advantage of the attractive prices and fearful environment. They need to find out about the blue chip companies from internet. The value of the shares of good companies normally appreciates after some time.

The safest way to reap profits will be to invest in gold. The price of gold has increased dramatically in past few years. On 15th June, 2010, gold price reached $1225, 00. It is predicted that by the end of June 2010, gold price will reach $1500 mark. One can also reap profits through currency investments. Currency trading can be done with little cash. Therefore, debtors can invest in currency market and utilize the profits in paying the fees charged by the debt consolidation companies.

Economic recovery

The global economy is now emerging from the financial crisis and GDP growth rates are improving. The unemployment rate has slowed down. The US government is taking necessary steps to prevent people from filing bankruptcy. They have started sponsoring debt consolidation companies so as to reduce bankruptcy rate. It is expected that the problems in the US housing market will be over within a year. Finally, the global GDP, which dropped by 2.2% in 2009, is expected to increase by 2.7% in 2010 and 3.2% in 2011.

To read more personal finance and money related articles, visit Penny Sense.

Can investors gain from the economic market in 2010?

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I’ve only recently gotten to learn and know more about Jim Rogers, the famous trend spotter who was also the cofounder of Quantum Fund with George Soros back in the 1970s.

If you do not know of nor heard about Jim Rogers, you can visit his website, The Millenium Adventure and see some of his published books and other works there.

This week’s The Edge did a feature on Jim Rogers and I savoured the article. It’s a good 3-pager and I learned some bits and pieces just by reading the feature article.

But what I found to be a surprise is that Jim Rogers does not believe in diversification when it comes to investment strategies. In his interview with The Edge, this is what he said:

“Look, nobody ever got rich diversifying,” he says a little defensively. “Diversification was something hare-brained investment advisers came up with so they could sell all sorts of fancy investment products and charge big fees. Henry Ford never diversified. You need to identify a good investment trend and stick with it.” Even legendary billionaire investor Warren Buffett, who runs diversified conglomerate Berkshire Hathaway, isn’t spreading his risks just for the sake of diversification, Roger says. “Buffett would tell you that he buys a lot of things that have similar characteristics.”

So what did you think of that? It makes sense but dare we not diversify after having been told for the longest time that we should and we must?

To read more personal finance and money related articles, visit Penny Sense.

Jim Rogers is not for diversification

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Good news for those who missed out on buying units of Amanah Saham Malaysia (ASM) the last round. You now have a chance to invest in these units again.

Permodalan Nasional Bhd (PNB) is opening up the remaining 1.6 billion ASM units for interested investors, without setting any quotas for bumiputras and non-bumiputras.

However, during the offer period of 21 July to 27 July, each investor is limited to a maximum purchase of 20,000 units.

After this offer period, there is no maximum limits and sale of the units will depend on availability of remaining ASM units.

So if you want to top up from your previous purchase or you missed your chance of buying, this is your second chance at investing in some ASM units.

You can read the full news release of this re-offering of Amanah Saham Malaysia units here.

To read more personal finance and money related articles, visit Penny Sense.

More Amanah Saham Malaysia (ASM) units for investors next week

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In today’s business news, Axis REIT revealed that Nestle will be vacating its Nestle House building and moving on to another premise in Mutiara Damansara as the current Nestle House building will not be able to cope with its future plans. You can read the full press release here on The Star.

Whilst this is a little temporary and short term setback for Axis REIT to lose rental income from a stable tenant for one of its iconic building in Petaling Jaya, it does present some longer term opportunities for investors.

Since reading this piece of news, I immediately went to check on the price of the REIT and will be monitoring how it is doing. At the current price of RM1.42, I am not buying in yet. If the price of this stock drops because of the news of Nestle moving out, then it is an opportunity for me to be buying in.

Of course the above is only my personal aim and strategy, you may beg to differ. But for discussion sake, if you were to buy into REITs, which REITs would interest you?

To read more personal finance and money related articles, visit Penny Sense.

Time to watch out for Axis REIT

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I saw an ad in today’s paper about the newest fund in the market by Public Bank – the PB USA Recovery Fund. From what I understand reading the brochure, this is a structured fund and it’s 100% capital protected in Ringgit. This fund aims to capture the economic recovery of the US equity market in the next 5 years.

I downloaded a copy of the brochure but the more I read, the more confused I got. So I decided to call and speak to a warm body. Here’s what I found out about the PB USA Recovery Fund and how it works.

• 100% capital protected in Ringgit Malaysia at maturity
• A closed end fund with an investment tenure of 5 years
• It’s a structured product that invests:
  • 90% of the NAV of the fund into domestic bonds and money market instruments
  • 10% of the NAV of the fund into S&P 500 options
• It has a callable feature, which means that some targeted returns are set and once these targets are being met, the investment will be called and returns will be paid out to unit holders
• No annual management fees and no service charges
• Minimum investment to start with is RM100,000

I do believe that the US equity market has a great potential upside come 5 years from today when the economy takes a turn for the better. Everything about the fund, especially the promise of zero management fees and no service charges, seem to be attractive. But I’m quite appalled by the minimum investment amount of RM100,000.

But if you have that kind of money, would you go for this fund? If I had all that extra money sitting in a bank in some FDs, I will really consider this fund.

To find out more, you can read the brochure (download it from Public Bank’s fund info page) for detailed technical explanations of how this fund works.

To read more personal finance and money related articles, visit Penny Sense.

How does the new Public Bank’s PB USA Recovery Fund work?

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