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8 de abril, 2009 por Iván.
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7 de abril, 2009 por Iván.
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6 de abril, 2009 por Iván.
Thursday, December 10, 2009
Sunday, July 12, 2009
to finance your small business is getting to be more difficult. Here are twelve basic steps you must take before going to the bank for a business loan.Finding the money needed to start a new business is almost always one of the most difficult obstacles new owners face. The most likely (and easiest) sources of capital are your families, friends and own savings. However, you should not overlook institutional sources as well.
1. Keep in mind that to stay in business banks need to make loans. Do not be afraid to ask for one. That is what the loan officer wants you to do. To increase your chances of getting a loan, look for a bank that is familiar with your industry and who has done business with companies like yours. Seek out banks that are active in small business financing. Some banks lend on a conventional basis (lending money without government support), while some banks participate in government programs (in the form of government participations involving direct government funds or loan guarantees). However, be aware that banks often demand stiff collateral requirements for start-ups.
2. As an entrepreneur, make sure that you are thoroughly prepared when you go to your banker's office to request a loan. You need to show your bankers that a loan to you is a low-risk proposition. Have on hand a completed loan application, copies of cash flow and financial statement projections covering at least three years, and your cover letter.
3. Learn to anticipate every question that he or she has. Remember, the combination of information and preparation is the most powerful negotiating tool in the world. A confident and thoroughly prepared borrower is four times more likely to have his or her loan approved than a borrower who does not know the answer to some of the basic questions a banker asks. To show the extent of your preparedness, your business plan should also include answers to your banker's questions. These questions normally are:
How much money do you need? Be as exact as possible; although adding a little extra for contingencies will not hurt.
How long do you need it for? Be prepared to go into detail about what the money will do for you and why your business is a good risk.
What are you going to do for it? Businesses use loans for three things: to buy new assets, pay off old debts, or pay for operating expenses.
When and how you will repay for it? Your cash flow projections should provide a repayment time frame. Convince the banker of the long-term profitability of your business and your ability to repay the loan by using your financial projections and business plan.
What will you do if you do not get the loan?
4. Do not take an apologetic and negative attitude. Keep your negativity in check. Present yourself as an entrepreneur who can and will repay the loan. Boost your image by providing your loan officer with any promotional materials about your business, such as brochures, ads, articles, press releases, etc.
5. Dress in a professional manner for the interview. This is a business transaction, so treat it as such.
6. Do not stretch the truth in your loan application. Broad, unsubstantiated statements should be avoided. The lender can easily check many of the facts on your application. If you cannot support statements with solid data, then don't make them. Do your homework and spend time doing research to be able to support everything you say, including every single number in your projections. It is best to keep projections, assets lists and collateral statements on the conservative side.
7. Be sure all your documents are neat, legible and organized in a cohesive and attractive manner. Type all your loan documents. Handwritten documents look unprofessional. Don't forget to include a cover letter.
8. Do not push the loan officer for a decision. Doing so might result in a rejection. Your banker cannot make a decision until all your documentation is complete. To ensure a speedy decision, make sure that your application is complete.
9. Be confident. An attitude of confidence enhances your chance of getting the loan. Show that you can make a success out of the money that the bank will lend to you. Visualize in your mind the positive results of your bank application.
10. Keep trying one lender after another until you get your loan. To improve your position as you change bankers and banks, the best way is to ask for a referral from a successful entrepreneur. Before you decide to approach a bank directly, find an associate, friend or acquaintance that is in good standing with the bank to give you a good referral. Bankers tend to deal more favorably those who were referred to them by their best customers.
11. Failure to discuss risk in your application. You must remember one thing: there is no business without risk. If you do not discuss risk, the bankers will assume that you haven't thought about risk. Let's face it - try as we might, we cannot plan for everything, for every contingency, for every turn of events. Bankers would want to know if you have planned for the major risks and how you intend to manage it.
Then, there is also the risk of too much success. The demand for your products or service may exceed well beyond your expectations, and they would want to know how you intend to handle success.
12. Remember that the first loan is usually the hardest to get. Bankers prefer to lend money to borrowers who have borrowed at least once and have paid back at least one loan on time. They are not venture capitalists that make high-risk loans regardless of the profit prospects of your business. Bankers prefer to lend to low-risk, low profit ventures than to high risk businesses or those with no record of accomplishment.
Credit cards can easily be mis-used, but it's hard to mis-use an unsecured personal loan with a fixed interest rate. You simply set aside enough money to pay off each monthly bill. That's why I like them.
But getting a half decent one can be tricky if your credit rating isn't perfect and, regardless of your credit history, there are some booby traps to watch out for whilst you're doing it. Here are some tips for any and all hopeful borrowers:
1. If your credit record isn't perfect
If you apply for a loan beyond your reach, you may be offered a much worse interest rate than the 'typical' APR advertised or, more likely, you'll be rejected. This will make your credit record even worse, because making multiple applications in a short space of time looks bad to many lenders.
Consider a tactical application. You're more likely to be accepted if you go for a loan with a slightly higher typical APR. Take a look at our loan partners page, for example. (Although we have partners, you can still compare the whole loan market through us.) This page contains the two cheapest loans on the market, supplied by Moneyback Bank and its owner, Alliance & Leicester. With these, an £8,000 loan over three years will cost you in interest just £778 and £802 respectively.
However, our data shows that just 20% (approximately) of applicants for these loans are successful, because they want the borrowers with the best records. Now compare this with Northern Rock, which costs you £914 in interest, but the acceptance rate is excellent at around and above 40%.
2. Look at costlier loans with more flexible terms
Some loans are flexible: they allow overpayments or a full, early settlement without penalty. Northern Rock's (I noticed when researching point 1 above) is unusually flexible in that it allows as many overpayments as you want for any amount, plus you can pay the whole lot off early.
If you took your £8,000, three-year loan out with them and overpaid by £150 roughly every three months, you'd save about £150 in interest, so that you've paid no more than a borrower with Moneyback Bank. Furthermore, you'll pay off your loan in just two years and five months, so you'll have a seven-month savings head-start. This would be about £2,000 in the bank by the end of year three, if you saved all the money you had been putting into repaying your loan!
You can find more flexible loans through The Fool by looking at the 'Other Charges' column in our comparison tables. Look for the words 'No charges that we know of'. You can then get further information by clicking on the 'Details' button.
3. What happens if you're declined?
Referring back to point one, above, you may be wondering what happens to the 60-80% who are rejected. Well, in addition to having a small mark put on your credit record, you are often referred to secured-loans companies, which will ring to pressure you into buying a loan that may be dodgy and probably expensive, with variable (not fixed) interest rates.
Sadly, we at The Fool can't stop lenders doing this to you even when you take out a loan through us. However, you can stop it yourselves! What you must do, as always, is read every page of the small print thoroughly. There will be a check box to stop the lender passing on your details to any other company. Some lenders make it difficult to find, so click on every link and read through it thoroughly.
4. Ring a company you already deal with
If your credit record is looking pretty rough, you may find that contacting a company which you already have a product with is your best bet. Don't just snap up any old loan it offers you though; think carefully about how much it costs, and consider whether you could do better.
You could always ask the helpful Fools on our Dealing with Debt board if you'd like their views on a loan you're offered.
5. Get a quote with PPI
Payment protection insurance (PPI ) is hideously over-priced when you buy it alongside a loan. A £7,500 five-year loan with the cheapest provider, Moneyback Bank, at its typical interest rate equals £146 per month. If you add to it Moneyback's PPI it costs £185 or £39 more per month. This will cost you an additional £2,340 by the end of the loan!
However, if you buy PPI separately with a provider like SecurityFirst, it'd cost a fifty-year old £332 in total (£5.53pm), and a 25-year old just £153 (£2.55pm). (Some providers make it more expensive for older people as they're more likely to become ill.) These are huge savings of £2,013 and £2,192 respectively!
If you decide to get PPI, make sure you thoroughly read and understand the small print, especially what claims are excluded, to make sure it's suitable. To take just one example, it's less beneficial to self-employed people. Learn more about stand-alone PPI in Ditch Your Rip-off Protection Today!
Thing is, you're more likely to get a loan if you request PPI, because the lender makes so much money from it. So, you could hugely improve your chances of getting a loan if you submit a request for it with payment protection insurance included. Then, as soon as you've got the paperwork, you send it back without signing it and ask for a re-quote without PPI. It would be very difficult for the lender to subsequently decline your amended application. But please make sure you do send it back without delay, or it'll cost you!
6. Watch the APR; it can be misleading
Lenders can manipulate APRs (the annual percentage rate of interest) to make them look better than they are. Therefore, to compare loans you should ignore the APR and instead look at the total amount repayable and the monthly payment. We make this easy for you in our loans centre.
7. Don't let the lender drag out your loan
Finally, the lender may offer you a longer loan than you ask for, tempting you with lower monthly payments. However, you'll pay more in interest if it's spread out for longer, so you should aim to pay off your loan as quickly as you can realistically afford, bearing in mind you still need to have enough money set aside each month to be able to cope with inflation (rising prices) and emergencies.
You might improve your chances of getting a loan by pretending you want to spread out the payments further. If you want to pay it off over three years, get a quote for five years instead. Then, when the paperwork arrives, send it back immediately without signing it, saying that you've changed your mind and want it over three years. They're less likely to turn you down then.
However, they might turn you down, even if they've transferred the loan to you before you've returned the paperwork (which they often do, the cheeky devils). So make sure you don't spend any of the money you've received, or don't pay off any other debts with it, until you've agreed the loan.
1.Print your best small ad on a postcard and mail it to prospects in your targeted market. People read postcards when the message is brief. A small ad on a postcard can drive a high volume of traffic to your web site and generate a flood of sales leads for a very small cost.
2.No single marketing effort works all the time for every business, so rotate several marketing tactics and vary your approach. Your customers tune out after awhile if you toot only one note. Not only that, YOU get bored. Marketing can be fun, so take advantage of the thousands of opportunities available for communicating your value to customers. But don't be arbitrary about your selection of a variety of marketing ploys. Plan carefully. Get feedback from customers and adapt your efforts accordingly.
3.Use buddy marketing to promote your business. For example, if you send out brochures, you could include a leaflet and/or business card of another business, which had agreed to do the same for you. This gives you the chance to reach a whole new pool of potential customers.
4.Answer Your Phone Differently. Try announcing a special offer when you answer the phone. For example you could say, "Good morning, this is Ann Marie with Check It Out; ask me about my special marketing offer." The caller is compelled to ask about the offer. Sure, many companies have recorded messages that play when you're tied up in a queue, but who do you know that has a live message? I certainly haven't heard of anyone. Make sure your offer is aggressive and increase your caller's urgency by including a not-so-distant expiration date.
5.Stick It! Use stickers, stamps and handwritten notes on all of your direct mail efforts and day-to-day business mail. Remember, when you put a sticker or handwritten message on the outside of an envelope, it has the impact of a miniature billboard. People read it first; however, the message should be short and concise so it can be read in less than 10 seconds.
6.Send A Second Offer To Your Customers Immediately After They've Purchased Your customer just purchased a sweater from your clothing shop. Send a handwritten note to your customer thanking them for their business and informing them that upon their return with "this note" they may take advantage of a private offer, such as 20% off their next purchase. To create urgency, remember to include an expiration date.
7.Newsletters Did you know it costs six times more to make a sale to a new customer than to an existing one? You can use newsletters to focus your marketing on past customers. Keep costs down by sacrificing frequency and high production values. If printed newsletters are too expensive, consider an e-mail newsletter sent to people who subscribe at your Web site.
8.Seminars/ open house Hosting an event is a great way to gain face time with key customers and prospects as well as get your company name circulating. With the right programming, you'll be rewarded with a nice turnout and media coverage. If it's a seminar, limit the attendance and charge a fee. A fee gives the impression of value. Free often connotes, whether intended or not, that attendees will have to endure a sales pitch.
9.Bartering This is an excellent tool to promote your business and get others to use your product and services. You can trade your product for advertising space or for another company's product or service. This is especially helpful when two companies on limited budgets can exchange their services.
10.Mail Outs Enclose your brochure, ad, flyer etc. in all your outgoing mail. It doesn't cost any additional postage and you'll be surprised at who could use what you're offering.
Saturday, July 11, 2009
Ten Tips for New Small Businesses
Save up as much money as possible before starting.All too often, people go into business without any savings, exclusively using loan money from friends, banks, or the SBA. They except to be able to start paying the loans back right away with their profits. What these business owners don't realize is that it can take months or years to make a profit. And once a lender discovers a business isn't as profitable as expected, the lender is likely to call in the loan or refuse to renew it for another year. Often new business owners then have to take out home equity loans or use credit cards to pay off their loans (which puts their home and credit rating at risk). For more information, see Business Financing FAQ.
A better plan is to save up as much of the needed investment money as possible, including your living expenses for the first year, or even two. Odds are that your business won't be profitable for one to two years. Even if you get plenty of business coming your way -- and your customers pay you on time, which isn't always a sure thing -- you'll want to be able to invest most of that money back in the business for space, equipment, advertising, and insurance needs.
Start on a shoestring.Think small. Don't rent premises if you can work somewhere else, and don't hire employees until you can keep them busy. (You can hire independent contractors or temps in the meantime.)
People who start their small business on the cheap, often in a garage, den, or some other scavenged space, and create their first goods or services with more sweat than cash, have the luxury of making their inevitable rookie mistakes on a small scale. And precisely because their early screw-ups don't bury them in debt, they are usually able to learn and recover from them.
Protect your personal assets.When you go into business for yourself, you are usually personally liable for all judgments and debts that the business incurs. This includes business loans, taxes, money owed to suppliers and landlords, and any judgments against the business as a result of a lawsuit. If you don't protect yourself, a creditor can go after your personal assets, such as your car and your house, to pay for these debts.
While you can protect yourself against lawsuits by buying business liability insurance, this won't help you with business debts. If you will be running up big debts, consider forming a corporation or limited liability company (LLC). Just one person can form either of these types of businesses.
Understand how -- and if -- you will make a profit.You should be able to state in just a few sentences how your business plans to make a substantial profit. For starters, you need to know your costs: how much you'll spend purchasing inventory, paying the rent, compensating any employees, and covering what is likely to be a surprisingly long list of other costs. Then you can figure out exactly how much you need to sell each month, for how many dollars, to cover those expenses and have an adequate profit besides. These numbers are all you need to create a "break-even analysis."
Make a business plan, no matter how short. Understanding your profit numbers and creating a break-even analysis is the first step in making a business plan. For most small companies, the key portions of a business plan are the break-even analysis, a profit-and-loss forecast, and a cash flow projection. (Projecting your cash flow is key and will make or break your company: Even if your business is getting plenty of work or selling its products, if you're not getting paid for 90-180 days, you're not going to survive unless you've planned for it.) With a cash flow spreadsheet in place, as well as a profit-and-loss forecast, you can tinker with your business idea and improve it before you start -- and continue to use them after you start.
Creating a business plan also allows you to determine what your projected start-up costs are (how much money you'll need to save) and what you marketing strategies are (how you'll reach customers to make sales). If you can't make the numbers work on paper, you won't be able to make them work in real life.
Get and keep a competitive edge.Building a competitive edge into the fabric of your business is crucially important to long-term success. Some ways to get this edge are by knowing more than your competitors, making a product that is hard or impossible to imitate, being able to produce or distribute your product more efficiently, having a better location, or offering superior customer service.
One way to hold on to your competitive edge is to protect your trade secrets -- confidential information that gives you a competitive advantage in the marketplace. Examples of trade secrets include customer lists, survey methods, marketing strategies, and manufacturing techniques. To protect your trade secrets under the law, you need to take steps to keep the information confidential. This includes marking documents "Confidential," using passwords to protect computer information, using nondisclosure and/or noncompete agreements, and limiting access to employees with a reasonable need to know the trade secrets.
Another way to keep your competitive edge is to react quickly to bad news. Once you see that your business faces some kind of adversity, you need to come up with a plan to deal with it immediately. This may involve moving your offices, introducing a new product or service, or developing a better way to reach customers.
Put all agreements in writing.The laws of your state require you to put some contracts and agreements in writing:
Contracts that will last longer than a year.
Contracts that involve the sale of goods worth $500 or more.
Contracts that transfer the ownership of copyrights or real estate.
Even if not legally required, it's wise to put almost everything in writing, because oral agreements can be difficult or impossible to prove. This includes leases or rental agreements, storage agreements, contracts for services (such as consulting or electrical work), purchase orders or contracts for goods worth more than a couple hundred dollars, offer letters of employment, and employment policies. Get in the habit of getting and giving receipts for all goods, services, and deposits, regardless of how much.
Hire and keep good people. Your goal should be to hire and retain truly excellent employees -- not just reasonably competent ones. A highly competent and truly enthusiastic employee is at least two and sometimes even three times as valuable as a person of average skills.
To create a stable and happy workforce, it's essential not only that your employees (and independent contractors) believe they are being fairly treated, but that your business is worthy of respect. Employees and contractors who like their work will represent you well on and off the job. And customers will more likely be loyal to an upbeat business -- and are more likely to recommend it to their friends.
Pay attention to the legal status of your workers. When you hire workers as independent contractors, make sure they shouldn't really be taxed as employees. The IRS can impose substantial penalties against you for not withholding taxes and paying taxes for a worker who is really an employee. The IRS and other agencies are likely to think that a worker is an employee rather than an independent contractor under any of these conditions:
The worker works full-time or nearly full-time for you.
The worker doesn't work for anyone else.
The worker provides services that are an integral part of your operations.
You control how the worker does the job and provide detailed instructions and training for the worker.
One way to help avoid trouble is to have the worker sign a written service contract, or independent contractor agreement.
Most employees you hire will be "at-will" employees -- subject to being fired at any time and for any reason (except for illegal motives such as discrimination). It's important to preserve your at-will rights because they protect you from having to prove that you have a valid business-related reason to terminate an employee. Don't make any promises to prospective or current employees that you are offering a permanent job or that they will lose their job only if they perform poorly, because this will limit your ability to terminate the employee for other reasons, such as personality conflicts or finances.
When hiring an at-will employee, have the employee sign an offer letter that makes it clear that the employment relationship is at will. Except for high-level executives, you shouldn't have employees sign an employment contract -- this can limit your ability to alter the terms of employment as your business needs change and subjects you to higher legal standards.
Pay your bills early and your taxes on time. In the real world, where a reputation for keeping one's word is a hugely important asset, a good strategy is either to pay your bills up front or pay them early. You gain trust, build a positive credit profile, and have a built-in safety net if things go badly. These benefits outweigh any interest you might earn by holding onto your money until the last possible minute.
Most importantly, pay your payroll taxes on time, especially the portion that you withhold from your employees' paychecks. The IRS and state tax authorities can hold you personally liable for these taxes, plus stiff penalties, if they're not paid. This is true even if you operate your business as a corporation or LLC or if your business goes bankrupt -- you will still be personally and legally on the hook to pay back payroll taxes.
Finding the Real Opportunities
Business ideas are all around you.They are lurking in your garage, in your basement, in your kitchen, and in your children’s room. You’ll find them in magazine ads, at your neighbor’s house, and at work. They are right there in the vegetables you brought in from the yard . . . in the stack of papers next to your laser printer . . . in the back of your truck . . . and at the back of your mind.
You don’t need to be a genius or an MBA to spot those ideas and turn them into profits, either. Identifying business opportunities is often as easy as identifying problems many people share and finding a way to solve them. When Matthew Osborne, an entrepreneur from Columbus, Ohio, wanted a way to make money, he found one right at his feet: dog dirt. Unlike most people who just gripe about stepping in it or having to clean it up, he started a business removing dog waste from homeowners’ yards. The business was an immediate success, and after several years, he sold the business for a quarter of a million dollars. Even then, however, he continued to make money from his idea by writing a booklet about how to start a pet waste removal business and selling the booklet on the Internet.
Other business owners have turned their hobbies, interests, and skills into satisfying and often lucrative businesses, simply by seeing a need in the world around them and finding a way to fill it. You can, too.
Do What You Love to Do
Businesses don’t just happen. They are made.
Whether you plan to profit by twisting balloons into smile-generating shapes or orchestrating the growth of multimillion-dollar, multinational companies, your success relies on what you bring to the business. If you love
what you do, your passion for the business will drive you to be knowledgeable, creative, and persistent. On the other hand, if your feeling for what you do is lukewarm, your success will be, too.
Turn Old Standbys into New Products
Truly new concepts are few and far between. Most new products or new business ideas are simply spin-offs of old ones. Inline skates is one good example. Essentially, they are ice skates on wheels or, depending on your point of view, streamlined roller-skates. Other new business ideas are nothing more than new ways of marketing mundane products. Take Dial-A-Mattress, for example. Furniture and bedding stores have always sold mattresses—but not by phone. Not until a furniture salesman by the name of Napoleon Barragan started a business selling mattresses over an 800-number phone line. The idea took hold, and today, Dial-A-Mattress sells some $70 million worth of mattresses each year.
You may not have the money, management ability, contacts, or desire to launch a major new product like inline skates or the energy or desire to build a multimillion-dollar sales organization. But you don’t have to launch anything that large to start a business or introduce a new product.
Years ago when my kids were little, I made money selling beanbags. The twist? I designed them in the shape of frogs and I filled them with birdseed instead of beans to make them pliable and less lumpy to the touch. To attract attention at craft shows, I displayed them in various human poses (sitting up, laying on their side resting their head on their hand, or hugging each other, for instance). I could produce them quickly and kept my costs low by making the frogs from inexpensive fabric remnants. That allowed me to price the frogs low enough to make them great impulse buys.
You can spin almost any skill or industry knowledge into marketable new products or services.
A neighbor turned his skill at fixing cars into a repair and tune-up service. His angle? He was mobile. Customers didn’t have to drop their car off at the shop. Instead, the “shop” (a van outfitted with tools and auto parts) came to them. Another acquaintance built a business by purchasing large quantities of chemicals and repackaging them in smaller quantities.
And several paper suppliers have created businesses by preprinting colorful brochure or flier designs on paper stock. The preprinted papers are then sold to businesses and individuals who use their laser printers to print out their own sales literature and fliers on an as-needed basis.
Look for Avalanches Marketing avalanches, that is.
“Drag your products into the path of an avalanche and you’ll be swept along with it,” says Alan Kaufman. Kaufman was the executive vice president of sales for Cheyenne Software when it was a small, vertical market software company that had big ambitions.
Cheyenne’s owners had been keeping a close eye on trends in the computer industry in the late 1980s. They felt that Novell local area networks (LANs) were about to snowball and started developing enhancement products for Novell LANs. Within six years, the avalanche (combined with good products and heads-up management) turned their little company into a $127 million operation before it was sold to Computer Associates. Cheyenne was the 13th largest software company in the United States and employed nearly 700 people at the time of the sale.
Look for Mundane Moneymakers
You don’t need to create exciting new products or services to go into business, either. Millions of business owners profit by selling routine and sometimes unglamorous services such as window washing, car repair, sandwich making, building maintenance, house cleaning, and plumbing. The key to making money with the mundane is to sell something your customers can’t do, don’t want to do, don’t have the time to do, or can’t get done well elsewhere.
Spin off a More Lucrative Business
The business you start today may not be the business you run tomorrow. Entrepreneurs and self-employed individuals sometimes find that their
initial attempts to start a business don’t bring in the profits they had hoped for. Nevertheless, they often benefit by discovering new profit-making opportunities because of contacts or knowledge they pick up running their first business.
Las Vegas resident Beth Waite used to make $7 an hour as a self-employed dressmaker. Her customers often asked her for advice on choosing clothes, and she discovered that information available in books often was confusing and not really helpful. Because of her research, though, she heard of Beauty Control, an image consulting firm. After taking the company’s training course, she started an image consulting business, charging clients $50 an hour for her advice. She supplements the consulting income with profits from the sale of Beauty Control products.
Monday, June 22, 2009
FXstreet.com (Barcelona) - USD/CHF is back close to 1.1700 level after reaching a fresh 4-weeks high at 1.1743. Currently, the pair is trading around 1.1695/1.1705, 0.10% increases from today's opening price.According to Valeria Bednarik, FXstreet.com collaborator, bullish bias remains intact: "Bullish strength remains intact in the pair, and the pair is consolidating close to today’s high, moving since past Asian opening in a tight range. Above 1.1716 that continues to be today’s high, also a previous weekly high and the pair could continue dominant trend. Indicators turned flat due to last hours consolidation, no clear sign from there. Under 1.1645 zone, some selling pressure could be seen."
Brazil Govt Oks BRL4 Bln Credit For States To Face Slowdown BRASILIA (Dow Jones)--Brazil's National Monetary Council in an extraordinary meeting late Friday approved 4 billion reals ($1.83 billion) in credit for state governments, the central bank said Monday. The loans, to be extended by the country's BNDES national development bank, will carry an interest charge of Brazil's TJLP long-term interest rate plus 3% annually. The TJLP interest rate is currently set at 6.25% annually. The loans come with a repayment period of eight years following a one-year grace period. According to the government, the loan funds must be used for investments and cannot be applied toward current spending. The extension of the loan funding for states comes following the approval of BRL1 billion in federal loans for cities last week. Brazil's states and cities have seen a decline in tax revenue over recent months following a deceleration of the country's economy. The National Monetary Council is Brazil's highest ranking economic decision-making body. -By Gerald Jeffris, Dow Jones Newswires; (5561) 3335-0832, gerald.jeffris@dowjones.com Click here to go to Dow Jones NewsPlus, a web front page of today's most important business and market news, analysis and commentary: http://www.djnewsplus.com/access/al?rnd=MnB3XRVmzONaVN%2BYqC6tLw%3D%3D. You can use this link on the day this article is published and the following day.
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In our opinion, the negative impact from the flu on oil price may not be as serious as the market anticipated. As many investors compare the current situation with the SARS in 2002, we would like to look back and see what had happened at that time.
With Crude Oil and Gold being in the spotlight this week, especially against purchasing news out of china, we still need to keep our feet firmly planted on the ground as we take a look at the facts.
Looking at the raw data on Crude Oil provided by the EIA, it is very hard to be supportive of a bullish price action for the near term. Crude Oil, Distillate’s, Gasoline and Propane stocks all reflect a much higher cyclical average than previously seen for this time of the year. This is underpinned by above average production level and Crude Oil days of supply.
FXstreet.com (Barcelona) - EUR/GBP has fallen close to 0.8900 level after a better than expected CBI retail sales data. Since the early European morning, EUR/GBP has lost around 60 pips from 0.8971, intra-day low, to 0.8910. Currently the pair is trading around 0.8910/20 after rising 0.07% so far today from opening price at 0.8909.CBI retail sales have posted a balance of +3 in April from -44 in March, which could indicate that the consumption slump has hit its bottom in the UK.. April’s sharp increase has been a positive surprise, as market consensus was for a -40 balance.Yesterday, the pair lost 1.32% from opening price at 0.9025, reaching 0.9056 as maximum and 0.8882 as minimum, to close the day at 0.8907.
GBP experienced profit taking as option names caught the European interbank market long. Cable and GBP/JPY suffered the most on the pull back, with the former trading back below 1.6500 as 1.6600 option strikes capped, while the latter traded back in to 161.55. A U.K. clearer bid underpinned EUR/GBP at 0.8500 and successfully absorbed selling interest from another U.K. name. Trailing stops are currently being filled in Cable, but this pullback should not damage the underlying bull trend that is currently influencing. Elsewhere, some attention is being paid to a Telegraph article, which is citing First Secretary of State Lord Mandelson, who said that Britain will obviously join the euro.
The S&P futures continue to creep further away from our uptrend lines as the bulls fight to avoid a retest of 900. The further our uptrend lines drift away, the more likely we are to see a sizeable pullback. On a positive note, buyers were able to keep the S&P at a reasonable level despite a report showing a decline in consumer prices in addition to Standard and Poors slashing its ratings on 22 U. S. banks. While considerable hope remains that the U. S. economy is on the path to recovery, investors can’t ignore that equities have made an incredible run thus far this year.
Economic Events & Indicators analysis is the examination of the underlying forces that affect the interests of the economy, industrial sectors and companies. As with most analysis, the goal is to derive a forecast for the future. Learning the monthly sequence of economic releases and market reaction to each release is one of the first steps in learning to track the economy. Forex traders should be taught to compare market expectations with actual economic indicators and then evaluate market reactions. Kye Economic Indicators have strong effects on Forex Market so currency traders should be aware of them when preparing strategies. Many profitable forex trades are made moments prior to or shortly after major economic announcements.
Forex fundamental analysis and technical analysis are essentially the two types of foreign exchange trading. Which one of this trading is better for me to make money? In fact, both are equally important if you want to make high profits from forex markets. Now let’s see what is meant by forex fundamental analysis and technical analysis.
In simple terms, the fundamental analysis looks at the world economy while technical analysis considers forex charts. The usage of forex robots like FAP Turbo and forex charting software programs are examples of technical analysis. But this guide we will discuss about the various economic or fundamental factors that can affect your forex trading profits.
In this tutorial you will learn how to implement fundamental analysis in your trading style. This is what some people called institutional Forex trading system.
You should learn the basic macroeconomic factors that influence global market. This is called fundamental analysis.
There is a great controversy between traders that use only technical analysis and traders that use only fundamental analysis. For me this is only academic. If there is information out there you should carefully watch it. Do not rely only in technicals or fundamentals. Use both. When you have a solid technical pattern that is supported by fundamentals then the chance that you are right is imminent. When technicals and fundamentals show in different directions then you should watch out. Do not be trigger happy with your Forex trading. Wait and see. Forex is not for prophets. You use scientific analysis in order to maximize the chance that you correctly recognize what the market has to give you. Analyze thoroughly, have a solid technical pattern, know the fundamental support of your analysis and you have a nice trading decision. Seize your risk tolerance and you will be a winner.
Those trading in the foreign-exchange market (forex) rely on the same two basic forms of analysis that are used in the stock market: fundamental analysis and technical analysis. The uses of technical analysis in forex are much the same: price is assumed to reflect all news, and the charts are the objects of analysis. But unlike companies, countries have no balance sheets, so how can fundamental analysis be conducted on a currency?
The forex fundamental analyst identifies and measures factors that determine the intrinsic value of a financial instrument, such as the general economic and political environment, and including any that affect supply and demand for the underlying product or service. If there is a decrease in supply but the level of demand remains the same, then there will be an increase in market prices. An increase in supply produces the opposite effect.
For example, an analyst for a given currency studies the supply and demand for the country's currency, products or services (Merchandise Trade); its management quality and government policies; its historic and forecasted performance; its future plans and the most important for the shorter term, all the economic indicators.
From this data, the analyst constructs a model to determine the current and forecasted value of a currency against an other. The basic idea is that unmatched increases in supply tend to depress the currency value, while unmatched increases in demand tend to increase the currency value. Once the analyst estimates intrinsic value, he compares it to the current exchange rate and decides whether the currency ought to rise or fall.
One difficulty with fundamental analysis is accurately measuring the relationships among the variables. Necessarily, the analyst must make estimates based on experience. In addition, the forex markets tend to anticipate events and discount them in the currency value in advance. Finally, serving as both a disadvantage and even as an advantage (depending upon the timing), the markets often take time to recognise that exchange rates are out of line with value.
Overall, the currency market remained in a risk-aversion mode throughout the European session, as the equity markets moved lower and S&P futures declined at a sustained pace. The market’s risk-aversion phase made the major currencies decline compared to the dollar, but still the yen traded range-bound. The market is expected to remain in a risk-aversion mode throughout the U.S. session, since the release calendar is almost empty and there are not any important meetings scheduled that could turn the market around.
The Euro (Eur/Usd) fell very easily down to the 1.3850 area during the overnight session, but since then the pair appeared powerless to break lower. Moreover, the second part of the European session proved very volatile as the S&P futures were breaking lower, but still the euro was not able to break the intra-day support level. During the European session, a release showed that the German Ifo Business Climate increased for a third consecutive month in June.
The underlying elements affecting the economy of the subject is studied by Forex fundamental analysis. According to this method, the analysis of economic indicators, social factors and government policy of a business cycle can forecast price movement and trends of the market. The fundamentals of any country, multinational industry or trading bloc lie in the combination of factors like social, political and economic influences. Though, it is rather hard to stay aside from all these variable factors. So, the sphere of complicated and subtle market fundamental lets the explorer know and understand more details of a dynamic global market during the analyzing.
The foreign exchange market (currency, forex, or FX) is where currency trading takes place. It is where banks and other official institutions facilitate the buying and selling of foreign currencies. [1]FX transactions typically involve one party purchasing a quantity of one currency in exchange for paying a quantity of another. The foreign exchange market that we see today started evolving during the 1970s when worldover countries gradually switched to floating exchange rate from their erstwhile exchange rate regime, which remained fixed as per the Bretton Woods system until 1971.
Presently, the FX market is one of the largest and most liquid financial markets in the world, and includes trading between large banks, central banks, currency speculators, corporations, governments, and other financial institutions. The average daily volume in the global foreign exchange and related markets is continuously growing. Traditional daily turnover was reported to be over US$3.2 trillion in April 2007 by the Bank for International Settlements.[2] Since then, the market has continued to grow. According to Euromoney's annual FX Poll, volumes grew a further 41% between 2007 and 2008.[3]
The purpose of FX market is to facilitate trade and investment. The need for a foreign exchange market arises because of the presence of multifarious international currencies.
Our currency trading forex courses are awesome and the hard work to come out these forex training course are proven logical, powerful, robust and well presented methodology. We have the great trader and mentor. The strategies that are being taught honestly in the course have paved & lighted the forex trading path & turned the dumb money into smart money. The pivot point trading method is analagous to precision guidance system. The signal analysis method gives high level of accuracy and most of the traders truly learn from the concise and useful technical information.
There are two main types of analysis one can use trading in the Forex. They are Fundamental analysis and Technical analysis. You should know a little about both types in spite of the fact that there has always been a debate which analysis is more preferable. It's necessary to examine the currency markets from aside and learn how news influences prices. You should know and understand the daily Forex news and market analysis proposed by professional currency analysts. Soon you'll realize what big part fundamental news are playing in your everyday trading. Luckily, most Forex news and analysis are offered on the Internet free of charge. We'll name these sites.
Technical analysis
Technical analysis is equal to charts, or, in other words, it's the study of price movement. The thing is that anyone can look at historical price fluctuations, and according to them, predict at some point where the price will go. In the charts one can find trends and patterns which will help you find good trading options. The most necessary thing in technical analysis is the trend! A lot of people know quite well that "The trend is your friend". You will more apparently succeed if you're able to find a trend and trade in the same direction, and Technical analysis can help you identify these trends as soon as possible. Then you'll get more beneficial trading opportunities.
Most clients eventually spend more cash on the market than they gain. Major causes of this phenomenon are the clients' low level of training, their emotional volatility, and lack of familiarity with foreign languages. The clients tend to not pay attention to the global events. Based on this fact, the "kitchen" method was born. Under this technique, the forex brokers take for granted that the client will lose money.
The forex broker acts as a liaison of the client to the forex market. The broker guides the client on the methods of trade. Just like a stock broker, a foreign exchange broker will provide technical analysis and research of the market situation. The information is supposed to increase the client's profit.
Financial companies are able to affect the forex market the most due to high number of large transactions they do. Before the emergence of the Internet, banks were the only organizations with access to forex. Now, however, practically anyone can enter the market at any time through a broker.
Besides the more obvious hard work and diligence and always saving little by little in their piggy banks, the really rich guys know how to work up the foreign exchange.
Basically, foreign exchange trading or simply FOREX trading is just the buying and selling of the world’s currencies. Money today is not the same as money tomorrow. Money has time value. The worth of a currency can go up or down.
There is one secret that FOREX traders live by. And it is buy low, sell high. Don’t ever forget that rule.
However, the trick is to know when to buy and when to sell. In FOREX trading, everything is by speculation. Sure, there are graphs to aid decisions. Business pages also give out strategies for the day. But the next step is always a guess based from the previous actions.
FOREX traders like to call their speculations as smart guesses. Usually, patterns on the currency values can be derived from how the politics of a specific country is running.
For example, if there is a plan to oust the president, most probably the value of that country’s currency will go down—how low, we don’t know. Usually. Because there are still a lot of factors to consider why a currency is going strong or not.
Improvement on the tourism sector can mean more foreign investments. This will be good for a particular currency, but this may affect how the other countries are doing.
These are just trade scenarios. As the cliché goes, one man’s medicine may be another man’s poison. One country’s good tidings may be another country’s, well, downfall.
That is why in FOREX trading, another secret to live by is to be aware of the national news in the country concerned.
Current events have a say on the economics of a country. Money makes the world go round, so to speak.
But, if one is truly serious in earning their first million in FOREX trading, another secret is—it might be a good idea to invest in a FOREX trading training school. Learn from the pros and conquer the world afterwards.
Let me leave you one last secret I learned from my father. If everyone is going in this direction, go the other way. This applies to FOREX and other areas of life. You won’t ever get rich by following the crowd.
Besides buying low and selling high, follow that last secret and you might just join the ranks of the taipans and billionaires.
Learn how to make an investment in Forex is not enough to succeed. Just knowing how to invest and which are the most common currencies of investment, as the U.S. Dollar, Euro, etc. are just the basics of investing. Knowing when to invest and what to invest in are two of the most essentials things to success in FX trading. But, why people that knows all these stuff still lose money? Here are some of the most common errors people make when trading in the Forex Market:
Saturday, June 20, 2009
FOREX — the foreign exchange (currency or forex, or FX) market is the and the most liquid financial market with the daily volume of more than $3.2 trillion. Trading on this market involves buying and selling world currencies taking the profit from the exchange rates difference. Forex trading can yield high profits, but it is also very risky. Everyone can participate in Forex trading via the Forex brokers.
Foreign Exchange (FOREX) is the arena where a nation's currency is exchanged for that of another. The foreign exchange market is the largest financial market in the world, with the equivalent of over $1.9 trillion changing hands daily; more than three times the aggregate amount of the US Equity and Treasury markets combined. Unlike other financial markets, the Forex market has no physical location and no central exchange (off-exchange). It operates through a global network of banks, corporations and individuals trading one currency for another. The lack of a physical exchange enables the Forex market to operate on a 24-hour basis, spanning from one zone to another in all the major financial centers.
