January 18th, 2010
There is a nice simple formula for determining how long it will take to double your money when you make a certain percentage per year. It is called the rule of 72. The mechanics are easy to follow. Divide 72 by the percentage you hope to have your investments return per year. Unlike regular math where you convert the percentage into a decimal, you do not use the decimal equivalent for this calculation.
Let’s assume that the market will give me an 8% return on my money. I divide 72 by 8 and come up with 9 years. This assumes you keep your annual returns in place and use the effect of compounding. What if you could increase the return by just a little? Let us say one half of one percent per month or 6% a year. Rather than taking 9 years to double my money, it would take a little over 5 years to double.
Is it possible to increase your return? It is not uncommon for those who take charge of their financial future and learn some of the methods offered in courses at this website to achieve monthly returns of 1 to 3 %. This translates to 12% to 36% per year. Is it worth it to spend a little time and effort to learn? You decide.
Tags: double your money, percentage increase, risk
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January 7th, 2010
What do airplane pilots, surgeons and successful traders have in common? 1. They have learned a skill 2.They are able to navigate risk 3.They practiced their skills in simulation mode before going live. 4 They update their skills regularly. 5. They generally earn a higher level of income than most. These five items took time and training. Why would anyone skip the steps to become successful? I wouldn’t want to hop in a plane if i knew the pilot was on his first flight and did not have any real background. Likewise, I sure would not want to be operated on by a a surgeon who never performed the procedure before. In the same manner, why would I participate in the market without some understanding of how it works?
Tags: risk, simulaton, successful traders
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December 30th, 2009
There is not a day that goes by that we are not exposed to risk. To live is to risk. Some would say that a life without risk is not worth living. Growth requires risk. Reward comes from the exposure to and conquest of risk. How we prepare for risk directly affects our response to risk. For some, risk is their lives. All we have to do is watch Most Dangerous Catch or other documentaries of the same genre to validate this statement. Most of us cannot imagine living like the men and women who risk their lives on ships, oil rigs or fighting a war. But, we can certainly appreciate their endeavors. Many people insert risk into their lives via sport and recreation. Think about the scores of people who enjoy sports such as downhill skiing, mountain climbing, scuba diving or bicycle racing. Clearly all of these sports represent risk and yet the risk does not deter people from engaging in them. Some think they avoid risk through denial. Others try to remove ownership and responsibility by developing a blame game approach. All one has to do is spend time with those who have severe drug addictions or who are incarcerated to realize how totally oblivious some can become to risk.
It is my observation that with proper education and training, those who face risk are able to successfully navigate around or through it. Those properly trained in the area of downhill skiing are not only able to thoroughly enjoy the sport but navigate unbelievable “risky” terrain. Likewise, the high level stock car driver is another example where education, training and experience allow for successful navigation of the track and perhaps even a winning race. In both instances, it would be foolish to engage in these endeavors without the tools of education, training and experience. Likewise, trading options or for that matter, even putting money into the stock market can be extremely risky without the tools. Why not start your education, training and experience today?
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Tags: education, risk, stock market, training
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December 14th, 2009
In 1906, an Italian economist named Vilfredo Pareto observed that roughly 80% of the land in Italy was owned by 20% of the population. This observation became known as the Pareto Principle or the 80-20 rule. It is not a hard and fast rule but the principle applies to our lives. In essence, not everything we do is equal. We can observe that large amounts of activity produce limited results. Conversely, we can also observe where small amounts of activity yield great results. This observation might be called the vital few and the trivial many. The key is what does this mean to me.
When it comes to anything, there are tradeoffs. For every YES there is a NO. When we say yes or engage in some type of work or recreation, we are really saying no to other things that we could be doing. The use of the Pareto principle could be used to help lead us to a more productive and profitable life. When I was a counselor in a Rescue Mission, I would challenge my clients to make a list of the areas of life that they needed to work on. For many the list was long. I frequently observed that they would select the trivial many instead of going after the significant few. They would work hard but in the end, they would give up or fail. They would wonder why. I would ask them if they wanted at least a 50-50 chance of success. All agreed. I would then use this illustration. Suppose you had ten items to work at. If the principle applied, it would suggest that 2 items would yield 80% of the overall desired results. It they chose to work on the trivial 8, they would have some return but clearly nothing like selecting the top one or two. In fact, it would yield less than 50%. They could work on 8 and get roughly have a 20-80 chance or work on the most important and have 80-20 chance. Those that selected properly faired much better.
When it comes to market education, there is a lot of material. My goal in developing the seminars is to present the significant few verses the trivial many. As an introduction, there is a FREE SEMINAR that you can use to help make your choice. Click here to access my free seminar and begin making more intelligent investment decisions. I truly hope you lead a long, productive and prosperous life.
Tags: Free Stock Market Course, stock market course principle
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