#Best Tax Free Muni Bonds

[alanappelbaum]

Even though rates are going up, municipal bonds are doing well

Even though interest rates are going up, municipal bonds are still doing well. The yield on tax-free municipal bonds is now at its highest level in more than a decade. Many munis are not taxed at the federal level, and some are also not taxed at the state or local level. This could help investors in higher tax brackets because it could increase the amount of money they get from the bond.

Tax-exempt bonds give investors a lot of benefits, like the chance to invest in low-risk, high-return investments that usually don't have to pay federal income taxes. They also let you avoid paying state income taxes or capital gains taxes on dividends you get from investing in these bonds.

Even though interest rates have been going up, municipal bonds have done well over the past year. This is because they are generally safe and can also help protect against inflation.

Investors can buy municipal bonds in a number of ways, such as through a bond mutual fund or ETF (exchange-traded fund), a bank, or an online brokerage account. Also, many funds offer a range of maturity dates and quality levels so that investors can choose what works best for them.

Tax-exempt bonds are an important way for the government to pay for a wide range of projects, including schools, hospitals, water and sewer facilities, and public power utilities. But the Tax Cuts and Jobs Act of 2017 made a big change by getting rid of advance refunding. This was a key tax exemption that let issuers refinance their debt when interest rates went down.

When it comes to risk and return, high-yield municipal bonds are a great choice for investors who want tax-free income that is often less volatile than Treasury bonds.  With the Federal Reserve on a path to tightening, now is a good time to think about adding to your portfolio of fixed-income investments.

Even though more money has been leaving the market this year, the municipal bond market has been strong with good returns. It usually gets back on track the year after a bad year, and its 4.1% gain this year suggests it may be on track for another good year.

Even though interest rates will remain unstable, municipal bonds should give good returns this year. Their yields are pretty good compared to other fixed-income sectors, and since the Fed is likely to keep raising rates, they'll likely be better than Treasury bonds in 2023. A low supply of municipal bonds and strong credit fundamentals should also keep municipal prices and yields high.

Even though interest rates are going up, municipal bonds have done well, which shows why tax-aware investors are putting them in their long-term portfolios. With a history of low default rates, municipal bonds are also a safe investment with a good chance of making money in the years to come.

The credit rating agencies have given them a grade of AAA, AA, or A (see Exhibit 1). These ratings show how strong the issuer's finances are.

As federal stimulus spreads through the economy and boosts revenues and cash flow, the demand for municipal bonds stays strong. A lack of new issues also helps to keep demand high.

Higher interest rates are still a worry, though. Consumer Price Index Swaps are one type of alternative investment that can help investors make up for losses. A well-balanced municipal bond portfolio should also include opportunities in mid-grade and high-yield credits, which may offer more ways to make money.

Diversification means putting your money into many different kinds of investments. This helps lower risk and makes it more likely that you will be able to ride out the ups and downs of your portfolio.

A diversified portfolio is made up of different types of assets, like stocks, bonds, commodities, and cash. This can also make the chances of a recession less likely.

Diversifying your investments can also help protect your wealth if you lose one of your investments. For instance, if you put all of your money into stocks and the market crashes, your whole portfolio will lose money.

Even though interest rates have been going up recently, municipal bonds have done well and continue to be a good deal. The yields on municipal bonds have gone up less often and are smaller than those on taxable bonds. They also have low correlations with other asset classes.

[your-dietician]

REITs Versus Bonds As Yield Investments

New Post has been published on https://medianwire.com/reits-versus-bonds-as-yield-investments/

REITs Versus Bonds As Yield Investments

Investors who are seeking the highest — but safest — yields possible eventually compare real estate investment trusts (REITs) with bonds. This is especially true for retirees who want to make the most of their retirement funds. They want the highest yields possible, but they don’t want to risk their principal. 

In order to compare REITs with bonds, take a look at the breakdown of these two asset types:

REITs

Equity investment in a wide-ranging portfolio of properties or mortgages

Dividends pay quarterly and some pay monthly

Dividends can increase

No specific maturity date

Value can grow 

Value depends on the performance of properties in portfolio

Shares can be purchased through a broker, in the shares of an exchange-traded ufnd (ETF) or in a mutual fund. REITs can also be privately traded 

Bonds

Debt instrument issued by companies and government entities with a promise to repay the principal plus Interest in a defined time period 

Interest pays every six months

Fixed interest

Set maturity date

Matures at face value (usually $1,000)

Value depends on the financial strength of the issuer

Bonds can be purchased through a broker (usually in increments of $1,000), in the shares of an ETF or in a bond mutual fund. U.S. Treasury bills, notes 

Comparing A REIT And A Bond

Here is an example of how a corporate bond and a REIT compare: 

An investor can purchase an S&P A-rated Cigna bond from an online broker that matures March 15, 2031, at $1,000. This is a callable bond that yields 2.375%. It can be purchased for $843.93, which gives it a yield to maturity of 4.615%. 

Now compare that Cigna corporate bond with the Arbor Realty Trust Inc. REIT. Closing price per share on Oct. 10, 2022, was $11.64. There is no maturity date, and it yields 12.96%. 

If you were an investor searching for the best income investment for your retirement funds, what would you choose between these two investments — the corporate bond or the REIT?

Taxation Of REIT Dividends And Bond Interest

Although there are a number of differences between REITs and bonds, there are also some similarities. Both REITs and bonds are sensitive to interest rate changes by the Federal Reserve. REIT dividends and corporate bond interest are also taxed as ordinary income. However, the National Association of Real Estate Investment Trusts (NAREIT) reports that REIT dividends can actually be divided into three categories for tax purposes: ordinary income, capital gains and return of capital. 

It should be noted that the interest of U.S. Treasury bills, notes and bonds are subject to federal income tax but not state income taxes. Many municipal bonds (issued by U.S. municipalities) are exempt from federal income tax and some are exempt from both state and federal income tax. Some people invest their retirement funds in U.S. Treasuries because of their safety. Usually munis — a nickname for tax-free municipal bonds — are not used in retirement accounts. 

So REITs or bonds? What do you prefer? 

Read next: This Little-Known REIT Is Producing Double-Digit Returns In A Bear Market: How?

Image from Shutterstock

Read full article here

[besttaxfreemunibonds66-blog]

Best Tax Free Muni Bonds - We are Experts in Tax-Free Municipal Bonds! Stoever Glass can provide you with the professional expertise and extensive resources typically available only to institutional investors. Our traders and salespeople do nothing but bonds; all day, every day!

[taxfree07-blog]

Tax Free Income With Municipal Bonds

Tax Free Salary With Metropolitan Bonds

After the previous year of enormous strife in the economy and the business sectors, speculators are pondering where they can contribute that is moderately protected and brilliant and give a higher return than money. Tax-free metropolitan bonds can give some soundness and a sensible after-tax return for some financial specialist portfolios. It is a virtual conviction that personal tax rates will go up (particularly for the "rich") throughout the following couple of years to pay for all the enormous government getting and spending that is going on this moment. Government managed savings and Medicare additionally need expanded "subsidizing" from tax incomes. Expanding personal tax rates make tax-free city securities increasingly appealing with respect to different speculations. Truly Muni's have performed well during times of rising tax rates. City securities seem appealing in respect to US treasury securities and money right now since they offer higher yields, lower taxes, and just marginally higher hazard (contingent upon the state) as I would like to think.

Muni Security Contributing Essentials

Credit hazard.

How protected is the state or district that is remaining behind the bonds? My recommendation right now with all the metropolitan spending shortages is to stay with more secure credits and higher evaluated bonds. General commitment (GO) bonds are normally more secure than income bonds since they have the full taxing specialist of the state behind them. California is as of now experiencing difficulty and is issuing IOU's as opposed to paying their obligations.

Loan cost hazard.

Security costs move the other way of loan fees. How much your bond cost will go up or down is straightforwardly identified with to what extent the term of the bond is. Long haul bonds (10-20 years) are considerably more unpredictable (dangerous) than shorter term bonds (1-5 years). I prescribe staying with the generally more secure present moment or moderate term securities. By and large the more credit chance and the more drawn out the developments of the securities you hold, the higher the yield on the securities. Higher risk=higher yield.

Is Everything Tax-Free?

In the event that you purchase a national muni security support your advantage pay will be free of government annual taxes (however not state personal taxes). In the event that you purchase a state muni security finance that possesses securities from your home express this intrigue pay will probably be "twofold tax free" for both government and state personal tax.

Your Personal Tax Rate?

Muni securities bode well on the off chance that you are in a high tax section. In the event that you are in a low annual tax section you might be in an ideal situation (after taxes) owning taxable bonds. At this moment muni security yields are exceptionally appealing with respect to taxable security yields so that muni securities bode well for speculators even in a portion of the lower tax sections.

Where Would it be advisable for me to Possess Them?

Muni securities ought to be possessed in your taxable money market funds, and not in your IRA or 401K records since salary in those records is as of now tax-conceded.

Tax-Comparable Yield? What's that?

To look at the yield on a muni cling to a taxable security you take the muni security yield and partition it by the reverse of your negligible tax rate. In the event that your muni security yield is 3% and you have a 40% minimal tax rate then the tax-identical yield is 3%/(1-.4) = 5%. That 5% is your tax-equal yield and that is the rate required on a taxable cling to beat your 3% muni security yield.

Would it be advisable for me to purchase individual securities or a muni security support?

The advantages of putting straightforwardly in individual muni securities is that you can maintain a strategic distance from the reserve cost proportion and can pick and pick which states, developments, and credits you need. You can make your own redid muni security portfolio and can stepping stool the developments on the off chance that you wish. The benefit of purchasing muni securities in a store is that you get proficient administration, expanded enhancement, and a more straightforward and simpler venture process for you. For most financial specialists who are not security specialists utilizing a muni security store will probably be ideal. What are some minimal effort muni security finance alternatives?

Constancy Minnesota Muni Security Store (FIMIX)- For Minnesota Occupants As it were

This is a 4-star appraised shared store at Morningstar. It is a twofold tax-free support (government and state) for Minnesota inhabitants. The normal development of the securities in the store is 7.1 years and the normal span is 6.5 years. 70% of the securities are evaluated AA or better (the best 2 FICO scores). In the course of the last 1, 3 and multi year timespans this store has positioned in the top 10% of its rivals in this class as per Morningstar.

I-Offers National Muni Security Store ETF (MUB)

This is a national muni security trade exchanged reserve (ETF), so it is just tax-free for government personal taxes. The cost proportion is a low .25% and the reserve holds more than 375 distinctive bond positions. 83% of the store is put resources into securities evaluated AA or higher. The normal length of the reserve is 7.5 years. read this article tax free

[jerrybenusa]

Top 5 Bond Trading Methodologies

Including bonds in your portfolio is one of the best ways to add diversification and reduce the risks involved with volatile assets like stocks. Bonds provide a predictable rate of return and carry a higher return than saving in banks and certificates of deposits. And if held to maturity, you get back the principal.  

There are different methods of investing in bonds. Your choice will depend on your risk tolerance. Like most investments, the more risk involved, the higher the return. Here are the top five.

1. Investing in Government Bonds

These are the safest forms of bonds. They are issued by the national government of a country to fund its operations. Government bonds are denominated in the country’s currency. When the bond is issued in a foreign currency, it is known as a sovereign bond.

Government bonds are the most stable type of bonds because they are guaranteed by the national government, which can easily raise taxes or print money to redeem the bond. But this low risk also means that they come with the lowest return.

2. Working with Corporate Bonds

Corporate bonds are issued by private and public corporations. Their purpose is to raise money for business operations, such as exploiting new business ventures. They are generally riskier than government bonds but pay higher rates.

Corporate bonds can be classified as investment-grade or speculative-grade. Speculative-grade bonds have a relatively lower credit rating than investment-grade bonds. They carry a higher risk of default, which makes them higher-yielding.

3. Investing in Municipal Bonds (“Muni Bonds” or “Munis”)

These are bonds issued by government entities like states, municipalities, or counties to fund public work, such as parks and libraries. They are tax-free at the federal level, which makes them attractive.  

Municipal bonds can be classified as:

Conduit bonds

General obligation bonds

Revenue bonds

General obligation bonds are not secured by revenue generated from a project. They can be payable from general funds or dedicated property taxes. Revenue bonds are secured by revenue from a specific project or another source. Conduit bonds are issued on behalf of private bodies such as hospitals. The borrowing entity is responsible for making repayments to the investors.  

4. Investing in Emerging Market Bonds

These are bonds that are issued by governments and companies in developing countries. Due to the high risk involved, they carry very attractive yields.

Emerging market bonds come with special risks, such as currency fluctuation as well as economic and political risks. Latin America and Asia are examples of developing economies.  

5. Investing in Inflation-linked Bonds

These are government bonds whose principal is adjusted regularly based on changes in the inflation rate. This then provides an inflation—adjusted or real return.

These bonds provide protection against short-term inflation. They lose more value when the real interest rates rise.

Winding Up

It’s easy to ignore the many advantages that bonds carry. They may not come with the excitement of unpredictability that other assets have, but the diversification they add to your portfolio cannot be ignored.

If you are more risk-tolerant, you can invest in speculative-grade corporate bonds or emerging market bonds. If you are a more risk-averse investor, try government bonds, investment-grade corporate bonds, and municipal bonds.

[bondmarketstrategies]

Top 5 Bond Trading Methodologies

Including bonds in your portfolio is one of the best ways to add diversification and reduce the risks involved with volatile assets like stocks. Bonds provide a predictable income and carry a higher return than saving in banks and certificates of deposits. And if held to maturity, you get back the principal.  

There are different methods of investing in bond investment strategy. Your choice will depend on your risk tolerance. Like most investments, the more risk involved, the higher the return. Here are the top five.

1. Investing in Government Bonds

These are the safest forms of bonds. They are issued by the national government of a country to fund its operations. Government bonds are denominated in the country’s currency. When the bond is issued in a foreign currency, it is known as a sovereign bond.

Government bonds are risk-free because they are guaranteed by the national government, which can easily raise taxes or print money to redeem the bond. But this low risk also means that they come with the lowest return.

2. Working with Corporate Bonds

Corporate bonds are issued by private and public corporations. Their purpose is to raise money for business operations, such as exploiting new business ventures. They are generally riskier than government bonds but pay higher rates.

Corporate bonds can be classified as investment-grade or speculative-grade. Speculative-grade bonds have a relatively lower credit rating than investment-grade bonds. They carry a higher risk of default, which makes them higher-yielding.

3. Investing in Municipal Bonds (“Muni Bonds” or “Munis”)

These are bonds issued by government entities like states, municipalities, or counties to fund public work, such as parks and libraries. They are tax-free at the federal level, which makes them attractive.  

Municipal bonds can be classified as:

Conduit bonds

General obligation bonds

Revenue bonds

General obligation bonds are not secured by revenue generated from a project. They can be payable from general funds or dedicated property taxes. Revenue bonds are secured by revenue from a specific project or another source. Conduit bonds are issued on behalf of private bodies such as hospitals. The borrowing entity is responsible for making repayments to the investors.  

4. Investing in Emerging Market Bonds

These are bonds that are issued by governments and companies in developing countries. Due to the high risk involved, they carry very attractive yields.

Emerging market bonds come with special risks, such as currency fluctuation as well as economic and political risks. Latin America and Asia are examples of developing economies.  

5. Investing in Inflation-linked Bonds

These are government bonds whose principal is adjusted regularly based on changes in the inflation rate. This then provides an inflation—adjusted or real return.

These bonds provide protection against short-term inflation. They lose more value when the real interest rates rise.

Winding Up

It’s easy to ignore the many advantages that bonds carry. They may not come with the excitement of unpredictability that other assets have, but the diversification they add to your portfolio cannot be ignored.

If you are more risk-tolerant, you can invest in speculative-grade corporate bonds or emerging market bonds. If you are a more risk-averse investor, try government bonds, investment-grade corporate bonds, and municipal bonds.

[alanappelbaum]

Municipal bonds are increasing their support for city infrastructure investments

Municipal bonds are an essential source of revenue for municipalities across the country, and their growing availability is proving to be a substantial windfall for communities eager to invest in infrastructure. However, the market has gotten more sophisticated in recent years as credit risk has become a significant element. New research investigates the influence of environmental, social, and governance (ESG) aspects on credit risk and how this may affect muni bond rates.

The obligation in general Municipal bonds are bonds issued by state and local governments. They are often used to support government initiatives that benefit the general population. Interest payments are often free from state income taxes. This means that munis are appealing to investors seeking income-generating options.

The real benefit of general obligation bonds is that they enable local governments to fund projects without requiring direct income. The profits of a general obligation bond, for example, might be used to support affordable housing initiatives, transit upgrades, or public parks.

Taxing power and issuer credit are used to underpin general obligation bonds. They are not backed by assets, unlike revenue bonds. However, GO bonds are only sometimes straightforward to get. As a result, several countries impose limits on the amount of outstanding public obligation debt.

Investing in municipal bonds may appear to be an adverse decision, yet munis may help fund public improvements in your state or community. They can be used to fund the building of public schools, hospital upgrades, water treatment plants, and bridges. These investments have the potential to provide investors with tax-free income.

There are two kinds of munis: revenue bonds and GO bonds. Both forms of bonds pay interest on a regular basis. The former are issued to pay costs, whilst the latter is backed by the ability of the issuer to earn money over time.

Some munis exceed the private security restrictions set by the Internal Revenue Service. This is due to the inherent risk of investing in the bond market.

Municipal bonds, commonly known as munis, offer an investment opportunity to support community and environmental projects. Investors can use municipal bonds to fund local schools, hospitals, and public infrastructure projects. Municipal bonds can provide interest payments that may be tax-free.

The federal government has made various initiatives to encourage investment in infrastructure. One option is to use the Build America Bonds program. This scheme offered investors a 35% federal tax credit, comparable to that offered by municipal bonds.

The private-activity bond is another possibility. These bonds offer tax-free funding for specific public-private collaborations. They may be utilized for any form of institution, such as schools, public utilities, and residential rental projects.

Investing in taxable municipal bonds for public infrastructure projects is a third alternative. The alternative minimum tax does not apply to qualified public infrastructure bonds.

A tax-equivalent yield is a valuable tool for comparing the returns on taxable bonds with municipal bonds. Taxes are an essential component of any financial strategy. They are, nevertheless, complicated. As a result, it is vital to be informed of your alternatives before settling on the best bond for your portfolio.

Before investing in a taxable bond, you must first estimate your income tax rate. This may be accomplished by utilizing the IRS's tax calculator. The outcomes might vary greatly depending on your economic level.

It would be helpful if you also evaluated the state and local tax rates in your location. Some states tax at a lower rate than the federal government.

According to a recent Public Policy Research Institute (PRI) analysis, the US municipal bond market is rapidly gearing up to fund ESG-based local infrastructure spending. However, many industry actors still need to agree on how to implement the notion into their strategy best.

Both public and private issuers may use ESG variables to offer information on how effectively they address environmental, social, and governance concerns. This data can assist investors in identifying opportunities and hazards.

While ESG issues have been more significant to stock investors in the last decade, muni investors have been slower to include them in their security research. The market needs a third-party ESG grading system, which is the problem.

[seotrader]

Top 5 Bond Trading Methodologies

Including bonds in your portfolio is one of the best ways to add diversification and reduce the risks involved with volatile assets like stocks. Bonds provide a predictable income and carry a higher return than saving in banks and certificates of deposits. And if held to maturity, you get back the principal.  

There are different methods of investing in bond investment strategy. Your choice will depend on your risk tolerance. Like most investments, the more risk involved, the higher the return. Here are the top five.

1. Investing in Government Bonds

These are the safest forms of bonds. They are issued by the national government of a country to fund its operations. Government bonds are denominated in the country’s currency. When the bond is issued in a foreign currency, it is known as a sovereign bond. 

Government bonds are risk-free because they are guaranteed by the national government, which can easily raise taxes or print money to redeem the bond. But this low risk also means that they come with the lowest return. 

2. Working with Corporate Bonds

Corporate bonds are issued by private and public corporations. Their purpose is to raise money for business operations, such as exploiting new business ventures. They are generally riskier than government bonds but pay higher rates. 

Corporate bonds can be classified as investment-grade or speculative-grade. Speculative-grade bonds have a relatively lower credit rating than investment-grade bonds. They carry a higher risk of default, which makes them higher-yielding. 

3. Investing in Municipal Bonds (“Muni Bonds” or “Munis”)

These are bonds issued by government entities like states, municipalities, or counties to fund public work, such as parks and libraries. They are tax-free at the federal level, which makes them attractive.  

Municipal bonds can be classified as:

Conduit bonds

General obligation bonds 

Revenue bonds

General obligation bonds are not secured by revenue generated from a project. They can be payable from general funds or dedicated property taxes. Revenue bonds are secured by revenue from a specific project or another source. Conduit bonds are issued on behalf of private bodies such as hospitals. The borrowing entity is responsible for making repayments to the investors.   

4. Investing in Emerging Market Bonds

These are bonds that are issued by governments and companies in developing countries. Due to the high risk involved, they carry very attractive yields. 

Emerging market bonds come with special risks, such as currency fluctuation as well as economic and political risks. Latin America and Asia are examples of developing economies.   

5. Investing in Inflation-linked Bonds

These are government bonds whose principal is adjusted regularly based on changes in the inflation rate. This then provides an inflation—adjusted or real return. 

These bonds provide protection against short-term inflation. They lose more value when the real interest rates rise.

Winding Up

It’s easy to ignore the many advantages that bonds carry. They may not come with the excitement of unpredictability that other assets have, but the diversification they add to your portfolio cannot be ignored. 

If you are more risk-tolerant, you can invest in speculative-grade corporate bonds or emerging market bonds. If you are a more risk-averse investor, try government bonds, investment-grade corporate bonds, and municipal bonds. 

[wesleybates099]

Ranking The Best Passive Income Investments

After about the 30th day in a row of working 12+ hour days and eating rubber chicken dinners at our company’s free cafeteria, I decided I had enough.

There was no way I could last for more than five years working in a pressure cooker environment like Wall Street. I became obsessed with generating passive income starting in 1999, the year I graduated from college.

We’ve discussed how to get started building passive income for financial freedom before. Now I’d like to rank the various passive income streams based on risk, return, feasibility, liquidity, and activity.

The rankings are somewhat subjective, but they are born from my own real life experiences attempting to generate multiple types of passive income sources over the past 20 years.

The passive income journey is a long one. But thanks to innovation and technology, the ability to generate meaningful passive income is accelerating!

Passive Income Starts With Saving

Generally speaking, it’s much more pleasurable to spend than to save. If saving was easy, we’d never have to read another story again about a multimillionaire who ended up broke.

By far the most important reason to save is so you can have enough money to do what you want, when you want, without anybody telling you what to do. Financial freedom is the best!

Sounds nice right? If only there was a formula or a chart like the 401k by Age chart which gives people guidance on how much to save and for how long in order to reach financial freedom. Unfortunately, saving money is only the first step in building passive income. Figuring out how to properly invest your savings is even more important.

If you can max out your 401k or max out your IRA and then save an additional 20%+ of your after-tax, after-retirement contribution, good things really start to happen.

Ranking Various Passive Income Investments

Below are eight main passive income investments to consider. Each passive income stream will be ranked based on Risk, Return, Feasibility, Liquidity, and Activity. Each criteria will get a score of between 1-10. The higher the score, the better.

A Risk Score of 10 means no risk.

A Return Score of 1 means the returns are horrible compared to the risk-free rate.

A Feasibility score of 10 means everybody can do it.

A Liquidity Score of 1 means it’s very difficult to withdraw your money without a massive penalty.

An Activity Score of 10 means you can kick back and do nothing to earn income.

To make the ranking as realistic as possible, every score is relative to each other. Furthermore, the return criteria is based off trying to generate $10,000 a year in passive income.

1) Certificate of Deposit (CD) / Money Market

There was a time when CDs would produce a respectable 4%+ yield. Nowadays, you’ll be lucky to find a 5-7 year CD that provides anything above 2.5% The great thing about CDs is that there are no income or net worth minimums to invest, unlike many alternative investments, which require investors to be accredited.

Anybody can go to their local bank and open up a CD of their desired duration. Furthermore, a CD and money market account are FDIC insured for up to $250,000 per individual, and $500,000 per joint account.

Everybody needs to take advantage of higher short term rates and save more. Just several years ago, money market and CD rates were only 0.1%. Now you can get an online money market account paying 2.3% as of 2H2019.

Risk: 10 (no risk), Return: 3 (as rates have increased), Feasibility: 10. Liquidity: 6. Activity: 10. Total Score: 39

2) Fixed Income / Bonds

As interest rates have been going down over the past 30 years, bond prices have continued to go up. With the 10-year yield (risk free rate) at roughly 2.4% in 2019, it’s hard to see interest rates declining much further. That said, long term interest rates can stay low for a long time. Just look at Japanese interest rates, which are negative (inflation is higher than nominal interest rate).

Bonds provide a terrific defensive allocation to an investment portfolio, especially during times of uncertainty like we are seeing with the US-China trade wars. If you hold a government bond until maturity, you will get all your coupon payments and principal back. But just like stocks, there are plenty of different types of bond investments to choose from.

Anybody can buy a bond ETF such as IEF (7-10 Year Treasury), MUB (muni bond fund),  or a fixed income fund like PTTRX (Pimco Total Return Fund). You can also buy individual corporate or municipal bonds. Municipal bonds are especially enticing for higher income earners who face a high marginal tax rate. You can also directly buy Treasury bonds through your online brokerage platform.

The main concern is the future of interest rates. If interest rates do go higher, bonds will decline in value, all else being equal. That said, so long as you hold the bond to maturity, you should get your initial principal back along with all the coupon payments if you are buying a highly rated bond e.g. AA.

See: The Case For Buying Bonds: Living For Free And Other Benefits

Risk: 8, Return: 5, Feasibility: 10, Liquidity: 8. Activity: 9. Total Score: 40

3) Physical Real Estate

Real estate is my favorite asset class to build wealth because it’s easy to understand, provides shelter, and generates income. The only bad thing about owning physical real estate is that it ranks poorly on the passive variable due to tenants and maintenance issues.

Owning your primary residence means you are neutral the real estate market. Renting means you are short the real estate market, and only after buying two or more properties are you actually long real estate. This is why everybody should own their primary residence as soon as they know they want to stay put for 5-10 years. Inflation is too powerful a force to combat.

In order to generate $10,000 in Net Operating Profit After Tax (NOPAT) through a rental property, you must own a $50,000 property with an unheard of 20% net rental yield, a $100,000 property with a rare 10% net rental yield, or a more realistic $200,000 property with a 5% net rental yield.

In expensive cities like San Francisco and New York City, net rental yields can fall as low as 2.5%. This is a sign that there is a lot of liquidity buying property mainly for appreciation and not so much for income generation. This is a riskier proposition than buying property based on rental income.

In inexpensive cities, such as those in the Midwest and South, net rental yields can easily be in the range of 7% – 12%, although appreciation may be slower. I’m personally bullish on the heartland of America real estate and have been actively buying commercial real estate there through real estate crowdfunding and speciality REITs, which we will discuss more below.

Risk: 5, Return: 8, Feasibility: 7. Liquidity: 3. Activity: 6. Total Score: 29

4) Peer-to-Peer Lending (P2P)

P2P lending started in San Francisco with Lending Club and Prosper in mid-2000. The idea of peer-to-peer lending is to disintermediate banks and help denied borrowers get loans at potentially lower rates compared to the rates of larger financial institutions. What was once a very nascent industry has now grown into a multi-billion dollar business with full regulation.

With a diversified portfolio of 100 or more notes, the leading P2P lenders claim investors can make an annual return between 5% – 7%. The returns used to be higher, but the increased supply of money has brought returns down.

The biggest problem I have with P2P lending is people not paying me back. There’s something that just doesn’t sit right with people breaking their contract obligations.

Risk: 5, Return: 6, Feasibility: 9. Liquidity: 6. Activity: 8. Total Score: 34

5) Dividend Investing

Investing in large cap dividend companies is one of the best ways to build passive income. The “Dividend Aristocrats” are a list of blue chip companies in the S&P 500 that have demonstrated a consistent increase in dividend payouts over the years.

Let’s say a company earns $1 a share and pays out 75 cents in the form of a dividend. That’s a 75% dividend payout ratio. Let’s say the next year the company earns $2 a share and pays out $1 in the form of dividends. Although the dividend payout ratio declines to 50%, due the company wanting to spend more CAPEX on expansion, at least the absolute dividend amount increases.

Dividend stocks tend to be more mature companies that are past their high growth stage. As a result, they are less volatile. Utilities, telecoms, and financial sectors tend to make up the majority of dividend paying companies.

Tech, Internet, and biotech, on the other hand, tend not to pay any dividends because they are reinvesting most of their retained earnings back into their company for further growth. But growth stocks can easily lose investors tremendous value over a short period of time.

To achieve $10,000 in annual passive income at the S&P 500’s ~1.8% dividend yield, you would need to invest roughly $555,000. Instead, you could invest only $154,000 into AT&T stock given its 6.5% estimated dividend yield. It all depends on your risk tolerance.

One of the easiest ways to get exposure to dividend stocks is to buy ETFs like DVY, VYM, and NOBL or index funds. You can also use a digital wealth advisor like Betterment to automatically invest your money for you at a low fee. The key is to investment consistently over time.

In the long run, it is very hard to outperform any index, therefore, the key is to pay the lowest fees possible while being mostly invested in index fund. It’s fine to take 10% – 20% of your investable assets and try to pick outperformers.

Risk: 6, Return: 7, Feasibility: 10. Liquidity: 8. Activity: 10. Total Score: 41

6) Private Equity Investing

Private equity investing can be a tremendous source of passive income with the right investments. If you find the next Uber, the returns will blow every single other passive income investment out of the water. But of course, finding the next Uber is a tough task since most private companies fail and the investment opportunities always go to the most connected investors.

The most liquid of the private investments are investing in equity or credit hedge funds, real estate funds, and private company funds. There will usually be 3-10-year lockup periods. The least liquid of the private investments is when you invest directly into a private company.

Access to private investments are restricted to accredited investors, which is why the Feasibility Score is only a 4. But the Activity Score is a 10, because you can’t do anything even if you wanted to. You’re investing for the long term. The Risk and Return score greatly depends on your investing acumen and access.

Gaining $10,000 a year in private equity investing is difficult to quantify unless you are investing in a real estate or fixed income fund. Such funds generally target 8-15% annual returns, which equates to a need for $83,000 – $125,000 in capital.

Risk: 4. Return: 7. Feasibility: 4. Liquidity: 2. Activity: 10. Total Score 27

7) Real Estate Crowdsourcing

Currently, my favorite passive income source is real estate crowdfunding, which allows individuals to buy a piece of a commercial real estate project that was once only available to ultra high net worth individuals or institutional investors.

Owning individual physical real estate is great, but it’s like going all-in on one asset in a particular location with leverage. If the market goes down, your concentrated investment could lose big time if you are forced to sell like many did during the last financial crisis.

Real estate crowdsourcing allows you to surgically invest as little as $500 into a residential or commercial real estate project for potentially 7 – 13% annual returns based off historical data. Such returns are much better than the average private equity, CD, bond market, P2P lending, and dividend investing returns.

Unlike P2P lending, with real estate crowdfunding, you at least have a physical asset as collateral.

For those of you who don’t want to come up with a $300,000 downpayment and a $1,200,000 mortgage to buy the median home in an expensive coastal city like SF or NYC, who don’t want to deal with tenants or remodeling, and who wants to sit back after an investment is made, check out Fundrise, my favorite real estate crowdsourcing company founded in 2012.

In mid-2017, I sold my San Francisco rental property for 30X annual gross rent and reinvested $500,000 of the proceeds in real estate crowdfunding to take advantage of lower valuations across the country with much higher net rental yields.

Coastal city real estate has become too expensive, and I expect people and capital to naturally flow towards lower cost areas of the country.

Risk: 7, Return: 8, Feasibility: 10, Liquidity: 7, Activity: 10. Total Score: 42

8) Creating Your Own Products

Finally, if you’re a creative person, you might be able to produce a product that’s able to generate a steady flow of passive income for years to come. At the extreme, Michael Jackson, makes more dead than alive due to the royalties his estate makes from all the songs he produced in his career. Since Michael’s death, his estate has made over $2.1 billion according to Forbes.

Of course it’s unlikely any one of us will replicate the genius of Michael Jackson, but you could produce your own eBook, e-course, award-winning photo, or song to create your own slice of passive income.

In 2012, I wrote a 180-page eBook about severance package negotiations that regularly sells about ~50 copies a month at $87 each without much ongoing maintenance. The book has since been revised and updated for 2019 to teach people how to negotiate a severance to give themselves a financial runway for their next chapter in life.

In order to generate $51,000 a year in passive income from the book as I do now, I would need to invest $1,275,000 in an asset that generates a 4% yield. To earn $10,000 a year in passive income would therefore need roughly $250,000 in capital.

Who would have thought a book about engineering your layoff could regularly generate so much revenue? We’re so busy with our jobs that our childhood creativity sadly vanishes over time.

Informational Source

[shandragdotson]

Welcome To The Financial Samurai Forum (FSF)!

Dear Readers,

Due to popular demand, I’ve launched the Financial Samurai Forums where the community can come and share their thoughts in four main categories:

Financial Independence

Real Estate Investing

General Investing

Career Growth & Exit Strategies

Financial Samurai has been up since 2009 and I’m proud to say we’ve got some of the most interactive and intelligent personal finance enthusiasts around. Just look at the Most Commented Posts on the right sidebar as evidence.

I’m impressed with the continued high quality of discourse over the years. Many of you have said that you’ve learned so much from other readers due to their different perspectives. So have I. It’s important that all of us find our blind spots on our path to financial freedom.

My #1 goal on Financial Samurai is for all of us to achieve financial independence sooner, rather than later. By getting our finances in order, we’ll be able to more easily live our best lives possible.

Financial Samurai Forum Categories

The FSF has actually been up for a couple months now after I invited subscribers of my private newsletter to join. I’ve successfully figured out how to keep spammers away, which was one of my main concerns before launch. I’ve decided to concentrate on the following topics below.

Financial Freedom

Financial Advice From The Community / Reader Profiles – Need advice or like to help others? Share your financial situation, ask questions, and get feedback from other members. I receive e-mail questions from readers all the time, but can’t answer them all. By asking the FS community and sharing your situation, your hit rate will be much higher.

Financial Independence Retire Early (FIRE) – Do you hope to retire early or have the freedom to do more meaningful work without having to worry so much about money? Already living the FIRE lifestyle? Ask questions and discuss your favorite strategies, experiences, the pros and cons, and more right here.

Family Finances – Finances get a lot more complicated once kids and/or aging parents are involved. Let’s try and figure everything out from daycare to college savings, grade school, elder care, estate planning, insurance and more.

Taxes – Taxes are our largest ongoing financial liability. Therefore, we need to do our best to understand the latest tax laws and use them to our advantage.

Real Estate Investing

Managing And Investing In Physical Real Estate – Discuss experiences with investing and managing physical real estate. Talk about market trends, property selection, ups/downs of being a landlord, property management, tenancy issues and more.

Real Estate Crowdfunding – Examine and share research on the best real estate crowdfunding platforms, talk about investment strategies, regions, deals, and trends.

General Investing

Stocks And Index Funds – Talk about stock ideas, trading, market trends, your favorite index funds, digital wealth managers, and other equities topics.

Fixed Income Focused – Explore topics regarding muni bonds, treasury bonds, corporate bonds, convertible bonds, interest rate outlook, macroeconomic trends, the Fed, and more.

Alternative Investing And Derivatives – Discuss alternative investments and derivatives such as private equity, venture debt, venture capital, angel investing, P2P, options, swaps, forwards, futures, royalty investing, and more.

Career Growth And Exit Strategies

Career Growth And Higher Education – Ask and answer questions on topics such as raises, promotions, career changes, going to grad school, getting a graduate degree, taking a sabbatical and others.

Entrepreneurship/ Side Hustles – Share small business and self-employment stories, chat about the highs/lows of entrepreneurship, discuss side hustles and other moonlighting projects here.

Engineering Your Layoff – Don’t quit your job when you can negotiate a severance. Discuss strategies for negotiating a severance and share severance negotiation success stories.

How To Register For FSF

1. To register for your own free account, simply click on the Register link in the forum menu or use this link: www.financialsamurai.com/forums/register/

2. You will need to read the Forum Terms Of Service on the registration page, scroll to the bottom, and click the accept button.

3. Next, you will be asked to select a Username. It must be unique and can not be changed after your registration is complete. Your username will be publicly visible, thus please do not use your email address as your Username. If someone already has the Username you input, you will see a yellow caution symbol next to the Username field. Once you have chosen a unique Username, a green checkmark will appear.

4. Enter your email address and a strong, secure password. Please use a combination of lower case letters, upper case letters, numbers and symbols.

5. Answer the verification question and prove you are not a spammer. All the answers can be found on the blog’s About page. If you haven’t read it yet, please do!

6. Once you submit your registration, you will receive 1 of 2 welcome emails and will be placed into the queue for administrative review. You will not be able to login until your request for registration has been approved. We do not want spammers in the forums, and this process helps keep them out.

7. If your registration is approved you will receive a second welcome email. The email body will state, “Your account has been activated manually by the admin and you can now login and post.”

8. Login and join the fun!

See You Around The FSF

It’s going to take time to build the Financial Samurai Forum community, but I’m confident after six months we will create a great place to hang out, have fun, and learn.

During non-post days, I’ll be exploring the FSF to see what’s going on and interacting with community members. So far I’ve already written about 200 forum posts, with many more hundreds to come.

Whenever I do something, I plan to stick it out for the long term. With my new goal of keeping Financial Samurai going until at least 2029, the FSF is one way to keep the magic alive.

Related:

Way Of The Financial Samurai: Core Principles For Achieving Financial Independence

Financial Samurai Reader Demographics: Our Money, Location, And Beliefs

The post Welcome To The Financial Samurai Forum (FSF)! appeared first on Financial Samurai.

from Finance https://www.financialsamurai.com/welcome-to-the-financial-samurai-forum/ via http://www.rssmix.com/

[financebrokerages-blog]

Important Things to Know about Bonds

A bond is basically a loan that has a borrower following a defined structure to pay back what they owe with interest on a definite schedule. In general, bonds are considered to be among the safest investments you can make.

Bonds have different structures.

There are various methods when structuring interest payments and the repayment of the principal. The most common one, though, features quarterly “coupon payments” for the interest with a full payment on the maturity date of the bond.

Most do not buy bonds directly.

Bond trading is dominated by banks. For you to participate directly, you’re likely to hire a bond broker.

The much simpler option is to depend on mutual funds and exchange-traded funds that feature the so-called “bond funds,” which are portfolio of bonds that are chosen under a specific criteria or handpicked by a professional fund manager. These funds let you indirectly invest in the bond market.

There are different types of bonds,

Bond markets are crucial in the global economy.  And the markets are complex. Here are some common bond types:

US Treasury Bonds

The US borrows hundreds of billion per year. The debt they issue now plays a major role in the global money markets.

There are 3 types of Treasury bonds, classified according to the length of their maturity:

·         Treasury bond, which mature in 20 to 30 years

·         Treasury notes, which mature in 1 to 10 years

·         Treasury bills, which mature anywhere from a month to a year

Saving Bonds

The US Treasury also provides savings bonds for individual investors. These are usually bought directly from the US Treasury.

Savings bonds can be bought as small as $25 and pay interest until they’re cashed in, which can be anywhere from 1 to 30 years from the date of the purchase. They don’t offer coupon payments. Rather, they allow the interest to accumulate until it’s paid-out in full when the bond is cashed in.

Municipal Bonds

Municipal bonds come from the city or state governments for funding projects and covering shortfalls.

Municipal bonds are free from federal taxes, so if you’re comparing different bonds to munis, it’s best to consider the tax benefits you may get from each.

Corporate Bonds

Corporations will need to borrow funds for a wide variety of reasons. They will often do so by issuing bonds. Corporate bonds can include what are known as “convertible bonds,” which grant investors the choice to convert their bonds into a stock asset at a predefined ratio.

Junk Bonds

Junk bonds are high-yield bonds from corporations or governments on relatively unsound financial status. Since there’s a real looming possibility that these companies default on some or all of their debt, they have to offer a much higher interest rates to appeal to investors.

In general, bonds have lower risks inherent in them when compared to stocks. However, junk bonds offer a much higher risks than stocks. So you should think twice before investing in these kinds of bonds.

Finance Brokerage providing an in-depth forex brokers list reviews to help our readers choose reliable Forex, Stocks, CFDs brokers to work with. Read and learn more about Finance Brokerage Personal Finance.

[derrickgilesten]

Even Cash Flooding Muni Market Can’t Stop Worst Loss Since 2018

Not even a continuously flowing spigot of investor cash was strong enough to prevent the $3.8 trillion municipal-bond market from snapping this year’s rally. State and local government debt is headed toward a 0.82% loss in September, the first down month of the year and the biggest decline since January 2018, according to Bloomberg Barclays indexes. The drop came as Treasuries sold off and as new debt sales weighed on performance, with supply of bonds 46% higher than it was the same month a year earlier as governments raced to capture lower interest rates, according to data compiled by Bloomberg. Barclays Plc strategists led by Mikhail Foux said they’re “cautious near-term,” given that expectations for a rate cut in October may be too optimistic and the market could stay volatile. The tax-free securities are still headed for a 6.7% return this year, the best year for the asset class since 2014. from FA News https://www.fa-mag.com/news/even-cash-flooding-muni-market-can-t-stop-worst-loss-since-2018-51922.html

[johnmauldin]

The End of Risk-Free Retirement

In the last 150 years, we’ve had a number of innovations that radically changed the way we live.

You can tick off the list: electricity, the automobile, refrigeration, TV, the Internet. But one innovation rarely makes those lists. It is just as significant if not more so…

Retirement.

The idea that people can stop working in their fifties or sixties and then enjoy 20+ years of relative leisure is actually quite new.

For most of human history, most people worked as long as they were physically able to and died soon after.

Our inventions often have a dark side that can come to haunt us. They may be applied to wage war… or to create reality TV.

Are we going over to the dark side with retirement? Maybe not, but we’re surely heading in that direction.

When Retirement Was Risk-Free

Saving money for retirement has never been easy for the average worker, but at least it was feasible. Until 2000 or so, anyone could lock in risk-free 5% or higher yields in bank certificates of deposit.

Suppose you saved all through your career and accumulated a million dollars. It was a simple matter to put it all in CDs, Treasury bonds, or tax-free muni bonds and generate $50,000 a year in current income.

Living costs were lower last century, too. Add in Social Security and you could enjoy a comfortable if not extravagant retirement. Your million-dollar principal would remain intact and could go to your children upon your death.

And this was relatively easy to do. It didn’t require any financial sophistication or even a brokerage account.

The hardest part was saving the million dollars in the first place, but you could get by with much less if you drew down the principal over a 20- or 30-year period.

Better yet, you could do this with no risk, just by keeping your money in FDIC-insured banks. You might have to split it between a few different banks to stay within the limits.

Some extra paperwork, but easily done.

Younger readers may think I just described a fantasy world. I assure you, it was very much a reality not so long ago.

Ask your grandparents if you don’t believe me. However, you may find them in a state of shock today because they thought the fantasy would last forever.

Indeed, their financial planner probably told them they could count on drawing down 5% of their portfolio per year to live on.

That’s because the income from the investments in their portfolio would more than make up for the drawdown.

None of This Is Possible Today

Neither you nor a massive pension plan acting on your behalf can generate enough risk-free income to assure you a comfortable retirement.

Why not?

Because our monetary overlords decreed that it should be so. Retirees and their pensions are being sacrificed for what now passes as “the greater good.”

Because these very compassionate overlords understand that the most important prerequisite for successful future retirements is economic growth. And they think that an easy monetary environment is the necessary fertilizer for that growth.

So, when they dropped rates to zero some years ago, they believed they would soon be able to raise them again – and get people’s retirements back on track – without risking future economic growth.

The engine of growth would fire back up, and everything would return to normal.

So much for the brilliant plan.

The Great Reset: The Collapse of the Biggest Bubble in History

New York Times best seller and renowned financial expert John Mauldin predicts an unprecedented financial crisis that could be triggered in the next five years. Most investors seem completely unaware of the relentless pressure that’s building right now. Learn more here.

[ronaldmrashid]

Welcome To The Financial Samurai Forum (FSF)!

Dear Readers,

Due to popular demand, I’ve launched the Financial Samurai Forums where the community can come and share their thoughts in four main categories:

Financial Independence

Real Estate Investing

General Investing

Career Growth & Exit Strategies

Financial Samurai has been up since 2009 and I’m proud to say we’ve got some of the most interactive and intelligent personal finance enthusiasts around. Just look at the Most Commented Posts on the right sidebar as evidence.

I’m impressed with the continued high quality of discourse over the years. Many of you have said that you’ve learned so much from other readers due to their different perspectives. So have I. It’s important that all of us find our blind spots on our path to financial freedom.

My #1 goal on Financial Samurai is for all of us to achieve financial independence sooner, rather than later. By getting our finances in order, we’ll be able to more easily live our best lives possible.

Financial Samurai Forum Categories

The FSF has actually been up for a couple months now after I invited subscribers of my private newsletter to join. I’ve successfully figured out how to keep spammers away, which was one of my main concerns before launch. I’ve decided to concentrate on the following topics below.

Financial Freedom

Financial Advice From The Community / Reader Profiles – Need advice or like to help others? Share your financial situation, ask questions, and get feedback from other members. I receive e-mail questions from readers all the time, but can’t answer them all. By asking the FS community and sharing your situation, your hit rate will be much higher.

Financial Independence Retire Early (FIRE) – Do you hope to retire early or have the freedom to do more meaningful work without having to worry so much about money? Already living the FIRE lifestyle? Ask questions and discuss your favorite strategies, experiences, the pros and cons, and more right here.

Family Finances – Finances get a lot more complicated once kids and/or aging parents are involved. Let’s try and figure everything out from daycare to college savings, grade school, elder care, estate planning, insurance and more.

Taxes – Taxes are our largest ongoing financial liability. Therefore, we need to do our best to understand the latest tax laws and use them to our advantage.

Real Estate Investing

Managing And Investing In Physical Real Estate – Discuss experiences with investing and managing physical real estate. Talk about market trends, property selection, ups/downs of being a landlord, property management, tenancy issues and more.

Real Estate Crowdfunding – Examine and share research on the best real estate crowdfunding platforms, talk about investment strategies, regions, deals, and trends.

General Investing

Stocks And Index Funds – Talk about stock ideas, trading, market trends, your favorite index funds, digital wealth managers, and other equities topics.

Fixed Income Focused – Explore topics regarding muni bonds, treasury bonds, corporate bonds, convertible bonds, interest rate outlook, macroeconomic trends, the Fed, and more.

Alternative Investing And Derivatives – Discuss alternative investments and derivatives such as private equity, venture debt, venture capital, angel investing, P2P, options, swaps, forwards, futures, royalty investing, and more.

Career Growth And Exit Strategies

Career Growth And Higher Education – Ask and answer questions on topics such as raises, promotions, career changes, going to grad school, getting a graduate degree, taking a sabbatical and others.

Entrepreneurship/ Side Hustles – Share small business and self-employment stories, chat about the highs/lows of entrepreneurship, discuss side hustles and other moonlighting projects here.

Engineering Your Layoff – Don’t quit your job when you can negotiate a severance. Discuss strategies for negotiating a severance and share severance negotiation success stories.

How To Register For FSF

1. To register for your own free account, simply click on the Register link in the forum menu or use this link: www.financialsamurai.com/forums/register/

2. You will need to read the Forum Terms Of Service on the registration page, scroll to the bottom, and click the accept button.

3. Next, you will be asked to select a Username. It must be unique and can not be changed after your registration is complete. Your username will be publicly visible, thus please do not use your email address as your Username. If someone already has the Username you input, you will see a yellow caution symbol next to the Username field. Once you have chosen a unique Username, a green checkmark will appear.

4. Enter your email address and a strong, secure password. Please use a combination of lower case letters, upper case letters, numbers and symbols.

5. Answer the verification question and prove you are not a spammer. All the answers can be found on the blog’s About page. If you haven’t read it yet, please do!

6. Once you submit your registration, you will receive 1 of 2 welcome emails and will be placed into the queue for administrative review. You will not be able to login until your request for registration has been approved. We do not want spammers in the forums, and this process helps keep them out.

7. If your registration is approved you will receive a second welcome email. The email body will state, “Your account has been activated manually by the admin and you can now login and post.”

8. Login and join the fun!

See You Around The FSF

It’s going to take time to build the Financial Samurai Forum community, but I’m confident after six months we will create a great place to hang out, have fun, and learn.

During non-post days, I’ll be exploring the FSF to see what’s going on and interacting with community members. So far I’ve already written about 200 forum posts, with many more hundreds to come.

Whenever I do something, I plan to stick it out for the long term. With my new goal of keeping Financial Samurai going until at least 2029, the FSF is one way to keep the magic alive.

Related:

Way Of The Financial Samurai: Core Principles For Achieving Financial Independence

Financial Samurai Reader Demographics: Our Money, Location, And Beliefs

The post Welcome To The Financial Samurai Forum (FSF)! appeared first on Financial Samurai.

from https://www.financialsamurai.com/welcome-to-the-financial-samurai-forum/

[cesarpdbhj-blog]

About arbitrage ea

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Are you presently ready to change the attached Product to ensure beginPrice is set within the bid price tag, stays so till some positions are opened and all are shut, then beginPrice is able to The existing bid benefit once more.

ten factors on EURUSD & GBPUSD The program is predicated on breakthrough of by far the most and bare minimum quantity value tag values on the previous shopping for and advertising working day.

- ActionPips - wherever the deviation of the value is entered throughout the posture. By way of example, at profit two, bota will invest in when Bid of the guide broker has two pips in the existing Inquire.

Forex arbitrage may be the simultaneous purchase and sale of forex in two distinctive marketplaces. Arbitrage in by itself is mostly a trade that earnings by exploiting the value dissimilarities of equivalent or pretty very similar fiscal instruments on assorted marketplaces or in several kinds.

Forex Robotic Opinions Mon Sep 08th, 2014 What caught my concentration on the outset look, is its exaggerated worth that does not replicate the profitability from the software Web page deal in Just about any way but presents it a vital acquire since it will not be utilized by lots of traders what's going to make its Dwell existing market place efficiency quite strong and flourishing if it was presently thoroughly coded and configured, but for me, I won't ever possibility a $2000 inside a application package deal without Brokerarbitrageur.com having using a distinct refund policy. Brokerarbitrageur.com / Best Forex Strategy / Forex Arbitrage Software

By doing this, a more exact Price may be attained than if the worth is calculated employing a existing-worth pricing technique. Arbitrage-totally absolutely free pricing is useful for bond valuation and likewise to detect arbitrage chances for traders.

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When you obtain this forex robotic that you'll be signing up for the bunch. You might be turning into a member of a little pick group of traders who have produced a decision to obtain massive excellent results in Forex.

Arbitrage buying and promoting is a chance in fiscal markets when connected property may be received and marketed concurrently at distinctive rates for profits. Simply put, an arbitrageur purchases cheaper assets and sells more expensive assets concurrently to take a income devoid of acquiring Internet money stream.

Brokerarbitrageur.com offer you fully absolutely free lifestyle span help and free of charge updates. Their tech aid will assist you to to setup and alter one particular-leg arbitrage mt4 ea to the VPS.

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Regulatory arbitrage by Brokerarbitrageur.com is where a regulated establishment normally takes good thing about the difference between its precise (or economic) possibility together with the regulatory placement. Like, if a monetary establishment, running beneath the Basel I accord, has to hold 8% money in opposition right here to default risk, but the particular risk of default is lowered, it is in fact worthwhile to securitise the loan, reducing the reduced risk private bank loan from its portfolio.

The most well-liked trade program online, Probably the most rewarding trade on Forex, the arbitrage EA is almost everything that is definitely essential for you for acquiring the secure dollars movement in totally computerized approach.

There's also The difficulty of spreads. The price discrepancy in arbitrage obtaining and promoting will only find yourself in achieve if this significant distinction exceeds the unfold of one's forex pair.

e., insurers switching their munis for corporates soon after a considerable loss because they can seize a bigger right away soon after-tax yield by offsetting the taxable firm earnings with underwriting losses). There are literally even further inefficiencies arising With all the exceptionally fragmented character with the municipal bond industry position that has two million extraordinary problems and fifty,000 issuers, in contrast for the Treasury sector which includes four hundred problems and just one issuer.

You'll be able to trade on MT4 brokers and Correct API brokers Furthermore and a number of other other (we would not have any limitatios) accounts in exactly the same time.

Employ the EA on broker hav­ing swift exe­cu­tion of orders. EA will deliver in log open up/near expenses of 3 symbol previous to open up/in the vicinity of purchase in your case com­pare rates on get instantly right after executed.

Automated Buying and promoting Program - is really a getting and promoting robotic that employs a concealed vulnerability While using the overseas Trade marketplace spot, which may be reluctant to extend that prosperous traders and brokers try out to hide.

What It truly is under no circumstances Even so, It's not always an uncomplicated path to riches. Earnings depend upon your functionality to make a smart broker wide range regarding selling price tag feed and latency. In addition, brokers regard latency arbitrage as snipping and have a tendency never to buy out earnings produced using such a technique.

[victorparker1-blog]

The 6 Best Short Term Investments Right Now (Low-Risk)

If you think there is a little too much risk in the stock market now, come across some extra money lately, or are looking to somewhere to invest for the short term there are some really good options out there for you.

Short term investments are investments that are temporary in nature as the the holding period is generally expected to be one to five years or less.

Long and midterm investments typically allocating funds in stocks and/or real estate for purposes of investing for the midterm or long haul, but those investment vehicles may not be the best option for people looking to invest on a shorter time period.

Let’s say for example you are saving money for a down payment on a house or car you plan on buying next year and you do not want to risk your money in the stock market.  In this scenario, you could look to a short term investment option.

If you are considering investing for a time period under 5 years, you will want to look for relatively liquid investments (meaning you can get your money back if you need it), that tend to be low risk, but still provide a return.

Below is a solid list of short term investment options for you to consider. 

1. Pay Off High Interest Debt

Maybe paying off high interest debt does not first come to mind when thinking about short term investments; but it could be the smartest move.  For example, if you have debt that has an 10% interest rate paying that down would provide you essentially a 10% return on your investment.  On top of that, paying down debt is similar to achieving a risk free return; when you pay down your debt you will no longer be charged interest on that amount. The money you save on the interest is your “return”.

An additional benefit of paying off high interest debt is that you would be putting yourself in a better overall financial position and potentially increase your credit score.

It is important to consider your overall financial situation and determine which investing strategy best fits your goals.  When looking for a short term investment, these options could work well for you.  Understand that the investment world changes often and you should continually evaluate options as they are presented to you.

Note that investing for the short term, where you are looking for low risk and relative liquidity is typically a different strategy than investing for the long term.

Pros:

Risk Level: Risk Free

Rate of Return: High, when paying off high interest debt

Cons:

Not as straight forward if you have lower interest rate debt

2. Municipal Bond

Municipal bonds are issued when state or local governments need to raise money.  Municipal bonds are considered only slightly more risky than U.S. securities, mainly because municipals have in the past paid less then owed or defaulted on the issued bonds.

Two recent municipal examples being Detroit in 2013 (largest US city to declare bankruptcy) paid less than they were owed on their bonds.  Also, on July 1st, 2016 Puerto Rico defaulted on their debt (first time a state or commonwealth has done so since 1933.)

On Wall Street these municipal bonds are often called “munis” and are classified into two segments, determined by how the issuing entity gets the funds to pay the bondholders.  The two segments are general obligation bonds and revenue bonds.

General Obligation Bonds (GO) are issued for entities that possess the ability to levy and collect taxes.  Given these entities can levy and collect taxes, typically the bonds are issued for free public use such as schools, prisons, police, fire rescue, and government buildings.

Revenue Bonds are issued for entities that possess the ability to charge fees or generate other charges by the specific public project being funded.  An example being a municipality issuing revenue bonds to fund construction on a new sports stadium, the revenue attained from ticket sales, parking fees and concession sales would go towards paying the interest payments and principal of the bonds issued.

You can buy municipal bonds directly from the municipality or invest (with investment firms) through bond funds (mix of municipal bonds.)

Pros:

Risk Level: Low

Rate of Return: Middle

Liquidity: Middle

Cons:

Chance of default, ideally offset by rate of return

3. Corporate Bonds

Similar to municipal bonds when a corporation needs to raise money they can pursue two types of financing; equity financing and/or debt financing.  The equity financing is stock offering while the debt financing comes in the form of a corporate bond.

Corporate bonds are agreements between a corporation and an investor(s) for which the investor lends money to the corporation for a agreed upon time frame at a agreed upon interest rate.

There are four types of corporate bonds:

Secured Bond – backed by some sort of collateral in case the of default

Unsecured Bond – backed by just the corporation’s promise to pay

Convertible Bond – the bond can be converted to the corporations common stock (at the option of the bondholder, at a predetermined price)

Zero-coupon Bond – these bonds have no interest payments, they are sold at a discount or premium to the face value of the bond.

Pros:

Risk Level: Low to Mid (dependent on Secured or Unsecured Bond)

Rate of Return: Middle

Liquidity: Middle

Cons:

Chance of default, ideally offset by rate of return

4. Treasury Inflation-Protection Securities

Inflation protection securities are fixed-income securities that are indexed to inflation; this is a simple and effective method to cut out one of the biggest risks with fixed income securities, inflation risk.

The most common inflation-indexed securities are United States Treasury inflation-protected securities or “TIPS” for short.  These TIPS are backed by the United States government which make them considered a very low risk investment.

Once these securities are issued the principal is adjusted each month for inflation (up or down) based on the Consumer Price Index for All Urban Consumers, or CPI-U.  The Treasury inflation-protection security coupon rate stay constant, but the dollar amount received would fluctuate with the change in principal each month (as adjusted for inflation)

Treasury inflation-protected securities are issued at a minimum amount of $100 and can scale up in increments of $100.  TIPs are issued in 5, 10, or 30 year terms and can be held to maturity or sold before.

As an example:

Let’s assume you invest $100 in a TIPS at the beginning of the year; with a coupon rate of 2%.  Let’s say at the end of the year the average inflation rate (as measured by the CPI-U) comes in at 5%.

With the average inflation rate of 5% the new principal amount would be ($100 x 5%) = $105.  The coupon rate is constant at 2%; so the resulting interest payment would be ($105 x 2%) = $2.10 over the year.

Treasury inflation-protected securities can be purchased in electronic form at TreasuryDirect.gov

Pros:

Risk Level: Risk Free

Rate of Return: Low

Liquidity: Middle to Low (dependent on term)

Cons:

Return my be under inflation

5. Online Savings Account

A more traditional approach for holding your money in the short term is an online savings account.  The benefits of an online savings account is that your investment is risk free (if under the FDIC coverage amount of $250,000) but can still offer you a modest return.

The reference to an “online” savings account over a more traditional brick and mortar savings account is that there are several banking institutes online offer rates over 1% in savings accounts.  (Banks including Ally Savings and Capital One 360 Savings)

Another thing to consider is that your investment would be extremely liquid in an online savings account; meaning you would not at risk of market fluctuations or early withdrawal fees.

Money Market accounts are very similar to savings accounts in that they both are insured by FDIC and essentially risk free.  The main two differences are how you are allowed to retrieve your money and certain interest rate tier structures.

Money markets allow you to write checks and use debt cards, while savings accounts typically would require you to retrieve your money via wire transfer or in person at brick and mortar location.  In this current market condition many online savings accounts offer a higher interest rate for the same risk level; so that is why we feel online savings accounts is a better option at this point.

Pros:

Risk Level: Risk Free (up to FDIC deposit limits)

Rate of Return: Low

Liquidity: High

Cons:

Return my be under inflation

Limit on transactions per month

Withdrawal method limitations

6. Certificate of Deposit (CD)

If you like the comfort of a savings account with the feel of investing, then a certificate of deposit (CD) may be right for you.  A Certificate of Deposit is essentially a period of time deposit where there is a fixed end date (maturity date) and known fixed interest rate of return.

A CD is a good option for short term investment because the deposits (at commercial banks or credit unions) are insured by the Federal Deposit Insurance Corporation (FDIC) or National Credit Union Administration (NCUA) which provides essentially a risk free investment.  CDs are also generally issued electronically and typically automatically renewed at the end of the term, which provides some convenience.

Certificate of deposits have many different maturity time frames to choose from and the dollar amounts can be issued in any denomination.

The downside of a CD is that your money is locked up for the specified time frame.  That’s not to say you could not withdraw your funds, but you would incur a penalty that would basically offset any interest you would have earned.

Pros:

Risk Level: Risk Free (up to FDIC deposit limits)

Rate of Return: Low

Liquidity: Middle to High (dependent on term)

Cons:

Return my be under inflation

Early withdrawal fees

What short term investments do you invest in? Have you had success with any of the ones listed above?

Author Bio: ThinkRichThinkPoor  – Matt & Thomas both genuinely have a passion for finance and want to really help people make the best possible financial decisions.  They look to share their backgrounds in finance, accounting, and real estate; exploring topics anywhere from paying off $47k of student loans in 18 months, building and selling homes, cryptocurrency trading, life in fortune 500 corporate finance, to being family men.  Follow @thkrichthkpoor

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