best cash investment

Best Investment Strategy For 2012 and Beyond

By James Leitz

The best investment strategy for 2012 and beyond will differ from the popular investment strategy offered by most investment advisers and financial planners today. The investment landscape has changed. Here's a strategy for making the best of it.

Up until recent times you could stay out of serious trouble by simply allocating about half of your investment assets to stocks and the other half to bonds. That's the traditional investment strategy often recommended for average investors, and most people deal with it by putting their money in stock funds and bond funds. Stock funds are the growth half of the equation and the risky part of the strategy. Bond funds are considered the relatively safe investment designed to pay higher interest income. Over the years losses in one fund type were usually offset by good returns in the other.

Welcome to the year 2012, where bonds and bond funds will likely not be such a safe investment. Stock funds are never safe and 2012 will be no exception to the rule. Asset allocation will be only half of the story going forward. Selecting the right funds within each category will be the other key to success. Let's look at your best investment strategy in both fund categories, and the reason why certain funds will be your best choices.

Two things stand out about the so-called recovery the USA has supposedly experienced over the past few years. 

First, the economy did not recover as it has in the past after a recession - 9% of the working force is out of work. This makes for a weak economy and puts pressure on the stock market and stock funds. That's why you'll need to be careful about which stock funds you include in your investment portfolio.

Second, interest rates have been driven down to historically low levels to stimulate the economy in general and the pathetic housing market. Even with a 4% mortgage rate average folks can not qualify for a mortgage or afford to buy a house. Today's ridiculously low interest rates mean savers can not earn a respectable interest income in truly safe investments. It also means that bond funds could be a trap in 2012 for people who don't really understand bonds and bond funds. Let's look at the best bond fund strategy first.

Even the best bond funds of the past few years could be big losers in 2012... if they hold long term bonds in their investment portfolios. When interest rates turn around and go back up the bonds they hold will lose significant value because new bonds will become available that pay more attractive (higher) interest income. Your best investment strategy for bond funds is to own funds that hold corporate bonds that mature in about 5 years to 7 years. CORPORATE BOND FUNDS pay more interest income than similar funds that invest primarily in government bonds. Funds that hold bonds maturing in 5 to 7 years (intermediate term bond funds) will be much less affected by rising interest rates than long term funds holding bonds that mature in 20 years or more. That's a fact, and that's how bonds work.

Your best investment strategy for stock funds will be to go with GROWTH AND INCOME funds that invest in high quality companies with a history of paying 2% or more per year in dividend income. If the stock market gets truly ugly in 2012 and beyond these funds will be your best bet to sidestep huge losses. In a bad stock market funds that pay little or nothing in dividends are usually the big losers.

Sometimes it pays to be aggressive and take on more risk. The year 2012 looks like a time to get more conservative and live to be a risk taker another day. Most investors need to hold stock funds and bond funds as well as truly safe investments like bank CDs. Your best investment strategy for 2012: allocate your investment assets with 40% going to INTERMEDIATE TERM CORPORATE BOND FUNDS and the same going to high quality GROWTH AND INCOME STOCK FUNDS paying 2% or more in dividend income. The other 20% of your investment portfolio goes to safe investments like bank CDs.

Author James Leitz teaches investment basics, stocks, bonds, mutual funds and how to invest in his investing guide for beginners called INVEST INFORMED. Put Jim's 40 years of investing experience to work for you and get up to speed at http://www.investinformed.com. Learn how to invest.

Article Source: Best Investment Strategy For 2012 and Beyond

Best money investment

Cash Investments

Most investors will tell you that there are three basic types of investments:  stocks, bonds, and cash.  Some individuals treat cash as something you only need to have on hand for those unexpected expenses.  But as we shall see, cash can, and should, play an important role in nearly everyone's mix of portfolio assets.

Cash Assets
There is no doubt that having cash around as "spending money" is a necessity for many of us.  We need cash to pay our monthly bills, and we might also like the idea of having some extra money handy in case an unexpected expense arises.  Those are two pretty compelling reasons to have, and hold, cash.

Asset Allocation
There are other reasons to hold onto cash, even beyond those "rainy day" expenses.  In fact, asset allocation theory tells us there are several factors that drive our need to hold cash, for example:

• Years Until Retirement - this factor should read more like: years until the money is needed.  The point here is the closer you are in time to needing money, the more liquid the investment.

• Risk Tolerance - if you're the type of person that panics when their investments are performing poorly, then you're a good candidate for investing in cash.

• Knowledge and Comfort with Alternative Investments - unfortunately for some of us, we are limited in our investment choices due to a lack of knowledge.  We simply don't know how to invest our money elsewhere, so we hold cash.  In this example, probably in-excess.

Advantages of Cash Investing
The primary advantage of cash is the preservation of capital.  That's a fancy way of saying cash is a very safe investment.  If you place your money in Money Market Funds or Certificates of Deposit, then you might even be covered by the Federal Deposit Insurance Corporation, or FDIC, which means your deposit is insured against loss.

Another advantage of cash is that it prevents you from liquidating assets from other classes, such as stocks or bonds, when you have a large expense coming up.  The last thing you want to do is sell a portion of your stock portfolio during a bear market to pay for your daughter's wedding.  Holding cash is a simple way to meet these types of financial obligations.

Cash investments are also extremely liquid assets.  That means they can be quickly exchanged for products or services we need.  In most cases, all we need to do is make a simple withdrawal from an account to have immediate access to our money.

Disadvantages of Cash Investing

On the other hand, the primary disadvantage of cash has to do with the overall return on investment.  The higher rewards in life usually go to investors that are willing to take greater risks.  That means relatively safe investments, such as cash, will provide relatively low returns.

This is one of the reasons many investors spend so much time trying to figure out how much cash they need on hand.  Investing is like putting our money to work, and if too much money is sitting around idle, then we're missing out on greater returns.

Where to Invest Cash
If you're convinced that cash can, and should, play an important role in your investment portfolio, then you have four options when it comes to cash investments:

• Certificates of Deposit
• Money Market Mutual Funds
• Money Market Accounts
• High Yield Checking Accounts

Certificates of Deposit
If you're an investor searching for a relatively low risk investment, then certificates of deposits, or CDs, might be of interest to you.  A CD is nothing more than a deposit account with a thrift institution or bank, which typically offers a higher rate of interest than a savings account.  CDs normally carry Federal Deposit Insurance Coverage up to $250,000.

Purchasing a CD
With a CD, you are investing a fixed amount of cash for a fixed period of time.  The more common terms you'll find for a CD include three months, six months, one year, three or five years. Interest is paid on a CD at predetermined intervals, usually monthly.  CDs that are redeemed early are frequently subject to an early withdrawal penalty.
Before buying a CD, make sure you understand all the terms and conditions associated with the deposit, including:

• Maturity Date - find out when the CD matures, most banks will provide this information in writing.
• Early Withdrawal Penalties - determine what early withdrawal penalties exist.  Penalties are usually stated in terms such as the forfeiting of interest payments.
• Callable CDs - a callable CD gives the bank the right to call in the CD after a set period of time.  If interest rates suddenly fall, then the bank can call in the CD, which means you need to move your cash elsewhere at a most undesirable time.
• Brokered CDs - if you're planning to invest a lot of money in CDs, then you need to understand if the CD deposit is being brokered.  FDIC insurance is on a per institution basis, with a limit of $250,000.  You'll want to make sure all of your CDs are not with the same financial institution.

Money Market Mutual Funds
Money market mutual funds are mutual funds that invest in short-term debt instruments.  Money market funds invest in certificates of deposits, government securities, commercial paper of companies, and other low-risk, highly-liquid securities. Unlike other mutual funds, they attempt to keep their net asset value (NAV) at a constant $1.00 per share.

High Yield Checking / Money Market Accounts
The exact rules may vary slightly with respect to high yield checking accounts and money market accounts.  But for many of us, these two investments are nearly identical.  These types of accounts are typically offered through local banks, and allow you to write checks.

In exchange for offering higher yields than savings accounts, high yield checking and money market accounts normally have fairly high minimum balance requirements.  There may also be restrictions with respect to the number of transactions allowed each month, such as the number of checks written.  You may also be subject to penalties if you exceed these thresholds.  Banks limit the number of transactions, so they can invest the money in longer-term, higher yield securities.

The important point to remember is simply this: before investing your cash in any of the above mentioned accounts, make sure you understand all of the fund's terms and conditions.  Ultimately it's your money, and you need to fully understand the rules associated with gaining access to that money.

Source: Here

Best Investment In Malaysia

Best Investment In Malaysia

If you are looking for the best investment in Malaysia, there are many things you can look into. There are many investment opportunities in Malaysia available. As a result, it can be very tough for you to decide on what to invest your money in. You may need to spend a lot of time going out to talk to various agents and also do some homework before you can try to understand all of the products.

The first thing you need to check is how much money you have to invest and what is your level of risk. Different people have different level of risk taking. Some likes to play it safe while others may just give it a try no matter how risky it is. There are many factors that can affect a person’s risk level. Besides personality factor, risk level may sometime change depending on the amount of money involved. Therefore, before searching for the best investment in Malaysia, ask yourself how much are you willing to invest and how comfortable are you in taking investment risks.

While investments such as stock trading can be very risky, it also can give you high returns. If you know how to do it right, you will be able to double your money in a short amount of period (or even more than double times). Nevertheless, if you are not careful, you can also whip out all the money easily. On the other hand, investment products that are less risky normally have lower rate of returns. Despite that, you feel safer knowing that your money is safe. This is the reason why the best investment in Malaysia is one that matches the risk level you find comforting.

The Best Investment In Malaysia Is One That Matches Your Risk Profile

There are many products in between such as unit trust funds, savings funds and gold investment in Malaysia. These products requires some level of risk but generally still pretty safe to invest. Unit trust funds used to be, and still is, one of the popular investments that people likes to place their money in. Do be weary because you may actually lose money in those. Make sure you have done your due diligence on the fund portfolio before diving in. Lately, there are many good savings products which are provided jointly with insurance coverage. This is safer and is becoming one of the best investment in Malaysia. Plus, if for some reasons you met with an untimely and unfortunate incident (ie. death), your loved ones will inherit the insured amount contracted with the plan. Gold investment has also been a very popular as gold prices have been increasing steadily over the past decades. Some people argue that the price has reached ceiling high but yet it continues to climb.

Each investment vehicles have their own advantages, as well as disadvantages. It varies based on individual preferences. The general rule of thumb is to not put all your eggs in one basket. Diversity is the key. Therefore, the best investment in Malaysia would be a portfolio of many different types of investment tools, which matches your priorities and risk profiles.

safe investments with high returns

safe investments with high returns
By eHow Contributor 

 A lot of people today have been stung by the current financial conditions, whether in stocks or otherwise. And, as a result, many are running for cover and seeking the safest money investments they can find to shelter their assets until the economy turns around.

We're seeing many investors now moving their money into investments like cash and "treasuries" that aren't going to keep pace with inflation. And although they aren't happy about losing money with any investment, they are settling for losing a little versus losing a lot somewhere else (e.g. the stock market).

I too have taken a more conservative approach with my investment portfolio, but I want you to understand that you can still find high yield safe investments right now if you know where to look! That's the key: most people don't know where to look, so they're settling for break-even or money-losing investments, when they don't have to.

"You can still find high yield safe investments without having to settle for break-even or money-losing assets! And I'll tell you where to find them."

Below, is important information about two of the most secure, high yield safe investments you can make today.

One is a very timely short-term investment that is expected to continue flourishing for the the next 2-3 years.

The other has been a cornerstone investment for many of the world's wealthiest investors for generations because it can deliver both asset security and superior yields. Best of all, it is expected to flourish for the next 25 years and I'm going to tell you exactly why, how and where this is happening!

Things You'll Need
• An open mind
• Desire to make a lot of money
• Money to invest

Instructions

 To find the best high yield safe investments, the first step is to keep an open mind. These days, many people run away when they hear anything related to "real estate".

At the same time, if you ask people whether we are in a buyer's or seller's market for real estate -- most will correctly say BUYER'S MARKET. In other words, great deals can be found and sellers are motivated.

So, before YOU run away, you owe it to yourself AND your bank account to learn about two very timely forms of real estate investment that have the potential of making you rich!

1. SHORT-TERM: For the next 2-3 years, I absolutely believe that foreclosure properties & bank-owned REO properties are the very best investments available to investors today. And I'm talking about across ALL investments -- these investments have the greatest wealth-building potential of all.

2. MID-LONG TERM: For the purposes of this article we're going to focus on a form of real estate investing that few investors understand or even know about: Investing as a silent partner with land developers in Raw Land Development projects.

Raw land development bears no resemblance to other forms of traditional real estate investments that most people are familiar with, such as residential or commercial real estate - which we know are both experiencing big problems these days.

Also, please be clear that I am not talking about "Raw Land investments" (also called "Land Banking") which is where you would buy undeveloped property, sit on it for a period of time, pray for appreciation and then hopefully, sell it for a profit.

"RAW LAND DEVELOPMENT investments" are much different.

You may have heard it said that: "more millionaires have been made in real estate than any other asset type of investment".

To take that a step further, professionally managed raw land developments are the most profitable and secure form of real estate investment!

Below are the steps that professional land developers take to create high yield safe investments with raw land development projects. And this is why they are cornerstone investments for many of the world's wealthiest investors.

Professional raw land developers do not rely on market appreciation for their profits, unlike "land bankers". Developers actually make their money by obtaining government approvals to use raw, undeveloped land for projects such as master-planned communities, shopping centers, business parks, etc. Once their plans are drafted and approved by the governmental agencies, the newly approved or "entitled" land is worth, on average, 3-5 times more than it was when purchased as raw, undeveloped land. (And this is before any structures or other improvements have been installed on the property!)

IMPORTANT NOTE: True raw land developers are not builders. They acquire raw, undeveloped land, get it approved to build on and then sell it to builders at a 300-500% MARK-UP, on average! This is why raw land development is the most profitable form of real estate.

During economic downturns like we are experiencing today, RAW LAND OWNERS are usually much more motivated to sell than in stronger economies. And, because professional raw land developers are typically far more knowledgeable about future community growth plans, they can often obtain desirable undeveloped land at bargain prices.

Because real estate is "cyclical" in nature, the timing for raw land development today is about as close to perfect as can be.

It usually takes 2 or more years to obtain all the required governmental approvals and complete a medium-large raw land development project.

So, assuming a raw land development project started today and if history repeats itself, the real estate cycle will very likely have turned back up by the time the project has been completed.Predictions are that we will begin to pull out of the down-cycle nationally by 2010. So, the timing today is extremely favorable and poses an opportunity for raw land developers and savvy investors to benefit from extraordinary property appreciation (which isn't normally factored into a land developer's calculations).

Raw land development expansion is an absolute necessity - not an option. We simply will require more land development in 10 Major U.S. Markets to support the U.S. population growth projections of >70 million new people over the next 25 years!

"Today, we are on the ground floor of an unprecedented raw land development expansion taking place in 10 Major U.S. Markets. It is the "perfect investment storm" for informed investors: when all the elements come together for an extraordinary event."

Finally, it's important for you to understand what sets raw land development investments apart from other high yield investments.

Here are the reasons why raw land development investments are cornerstone investments for many of the world's wealthiest investors and why every accredited investor needs to consider including these high yield safe investments in their retirement portfolios:

1) On average, a professionally managed raw land development project will increase the value of raw, undeveloped land by 3-5 TIMES what was originally paid for the property. In other words: an average 300-500% Gross Return On Investment for the raw land developer! (Before associated costs.)

2) Raw Land Development Investments are typically secured by the value of the land that is being developed. Also, investors are usually placed in 1st position for project assets and revenue for additional investor security. This means, in the event of an unforeseen catastrophe (heaven forbid), the land can be sold, allowing investors to recoup all or part of their investments in the project. Now compare that with stocks, bonds and most other investments where there is virtually no security on invested funds.

3) Raw land is virtually recession-proof because it really doesn't appreciate or depreciate much in it's undeveloped form, regardless of the economy (until the development process is completed.)


Article source: Here

best low risk investments

Risk-free investing
 Low-risk options 

National savings and gilts
One of the lowest risk investment options is the National Savings and Investments (NS&I) tax-free saving certificates. Particularly index-linked savings certificates, which guarantee to outstrip inflation.

A number of issues are offered each year, and you can invest up to £15,000 in each one.

If interest was, say, at 1.35% plus inflation, with RPI at 3.0% it would give a rate of 4.35% equivalent to 5.45% gross for a basic-rate, 7.30% for higher-rate, taxpayers.

Alongside these are British government stocks or gilts, which can be bought through a stockbroker.

These usually pay interest twice a year, plus the stock's nominal value when it reaches its redemption date, which may be ten or more years later. They can be sold before this for a less certain return.

Cash Isas

A good way of boosting your savings is to hold them in a cash Isa. The interest from these accounts is tax-free.

You can pay in up to £5,640 in the 2012-13 tax year, and top up your Isa account annually. Most savers can benefit by using their annual Isa allowance before putting any remaining funds into ordinary taxed accounts. But remember that if you want to move your Isa to a higher interest product, apply to transfer it rather than taking out the money and reinvesting it yourself.

This is because if you withdraw your money and then reinvest it during the same tax year, you'll be using up all or part of your tax free allowance for that tax year.

Savings accounts
You may use a current account for everyday spending, but it makes sense to move any surplus funds into a savings account.

In choosing one, you need to look carefully at its features as well as the interest rate it pays.

Instant or easy-access accounts suit those who may need to withdraw money at short notice. They are suitable accounts for rainy day funds but don't offer much growth above inflation.

For example, if you invested £10,000, the gross interest you would get at 6.4% is £640. Tax at 20% on this is £128, which leaves £512 net. For higher-rate taxpayers the net rate is 3.84%, which means their money lags 0.06% behind inflation.

Higher rates of interest are often offered to savers when they open a new account. These bonus rates commonly last for 6-12 months, reverting to a lower rate thereafter, so it is worth making regular checks to confirm the rate you will receive.

Some savings accounts offer higher rates of interest to those who can give 30, 60 or even 90-days notice before making withdrawals and often the best interest rates can be from accounts accessed online.

Others limit the number of withdrawals you can make to three or four a year – deducting interest if you need to make more. Another common feature is tiered interest rates, where those who can afford to deposit a large sum are paid a higher rate.

Regular deposits can also earn you higher rates with some accounts. Accounts of this kind do not normally allow withdrawals during the year though and are often capped in terms of the total amount you can save.

Higher rates still can be earned by combining your savings and current account, or saving with your mortgage provider.

Bonds
Bonds could provide another safer option for those looking to invest.

Guaranteed income or growth bonds are sold by insurance companies and guarantee to repay your original investment, plus interest, provided you hold them for the full term – typically up to five years. As with any fixed-rate product, you may lose out if the base rate rises.

Guaranteed equity bonds offer a less certain return and are only risk-free in that you should get back your original investment, but interest paid is linked to stock-market performance. There is a risk of a poor return if equities fall over the period you hold the bond.

NS&I also pays premium bond prizes tax-free. These are not the same as guaranteed interest, as you may not win, but your original investment is never at risk, except from inflation if you don't win anything.

Cash under the mattress
Finally, worried savers may be tempted to put their cash under the mattress. But surprisingly, this is a fairly risky strategy.

As it is not earning interest, your capital will be seriously eroded by inflation, even if inflation is currently low. And you won't be able to claim on your house insurance if your cash is stolen or goes up in smoke.

Source: Here