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01/21/16 Investing

New Ways to Invest your Money and Diversify your Portfolio

stock marketThe current market is in such a state that you may be tempted to just give up on investing altogether and keep what you have right now. However, this is not advised unless you want to miss out on the chance to strike it big. If your portfolio has been taking high damage hits in the recent years, now is the time to patch it up and get it back in the game so as to take advantage of it when the market looks up soon.

Alternative investments are those in which you invest in something other than typical stocks and bonds. This includes assets such as creature comforts, annuities and even property. These investments can be used to your advantage when you are trying to fix the smoking ruin that was your once-strong portfolio. There are many alternative forms of assets that you can invest in when you are looking to repair your portfolio. Here are some of them:

Property

Although many people see it as the reason behind the first recession of the 2000s, it still has the capacity to be a good addition to your financial portfolio. While there isn’t a big demand for housing in the current market, there are a number of REITs or Real Estate Investment Trusts that are there to help you invest in property while negating your risk of being impacted yet again. These trusts have helped a huge amount in the stabilization of the real estate market, serving to reduce its volatile state and bring back increased returns on investments.

Securities

The economy is slowing down. We have all seen the telltale signs of it. However, a lot of people, especially experts, see this as a sort of calm before the storm. When inflation does hit again, you need to be ready for it. The market is like a wave graph – ups and downs over the years. Treasury Inflation Protected Securities (TIPS) are the perfect way to do this. All you need to do is invest in some of these and you are protected against sudden jumps in the inflation rate. While the rate of return is constant, the amount returned is calculated taking current inflation into account as well.

Commodity Investment

The price of commodities increases with inflation. This means that, like stocks, buying and selling these at the right times can result in quite a high yield for you. Since inflation impacts the return on stocks in a negative fashion, you can balance out the losses you may suffer by trading in commodities you previously invested in. In addition to this, this sort of investment serves another purpose as well. It allows you to diversify your portfolio greatly, meaning that you have your eggs in multiple baskets so that at least a few will hatch for you!

There are many other types of assets you can invest in other than commodities, real estate and TIPS. Doing a little research or even consulting with a reputed investment advisor can do you and your portfolio wonders. Remember to always try to stay ahead of the curve when investing. Invest in the future; not the present.

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09/21/15 Investing # ,

What Are the Twitter Birds Saying About the Stock?

What Are the Twitter Birds Saying About the Stock?

Twitter (TWTR) stock plunged below its public debut price recently, sending investors into a selling frenzy. The company’s shares dipped below the key $26 price set in November 2013.

While the stock staged a mini-recovery to close above $26 on Thursday, August 20, traders’ nerves were frazzled and sentiment is now bearish. Twitter sank some 5.83% – down $1.61 after opening for the day at $27.15, hitting a high of $27.48 and closing at a low of $25.92. At its present price, Twitter has a market capitalization of $18.67 billion.

The dramatic price drop is startling given that Twitter hit its peak in December 2013 when it was trading above $73. What started the company’s stock decline was the release of Q2 earnings. The head honcho of Twitter stated that a big part of the challenge for Twitter is that everyday people find it a little user-unfriendly. In order to reach mass-market appeal, Twitter needs to break out beyond its key base of users.

The interim Chief Executive Officer of Twitter – Jack Dorsey – may not be in contention for a permanent post with the company. So far, trader sentiment about Twitter has nosedived, as is evident at the leading binary option broker companies. Put options outweigh call options by a long margin and medium-term projections for the stock range from bearish to neutral.

Is Twitter a Dead-End Stock?

Several months ago, Twitter was trading at $50 per share. The Q1 earnings report sent the stock into a tailspin and some 20% was wiped off the stock’s value in a single day’s trading.

Since April, the share price has tanked and the freefall was only partially halted when the key $26 price was hit. That Twitter booted out former CEO Dick Costolo did little to inspire confidence in a flailing social media company that has failed to grow its user-base beyond 315 million people.

To complicate matters, Facebook has been eyeing Twitter for some time now. Already the hashtag symbol has been added to Facebook algorithms and Zuckerberg’s team is feverishly working on an alternative to Twitter’s mobile ad distribution system.

This begs the question: Is Twitter a Dead-End Stock?

Several analysts believe that investors should think twice about writing off Twitter just yet. The stock has several things working in its favour and the potential upside is worth the wait. The following reasons have been cited for going long on Twitter stock:

  • Twitter retains plenty of appeal in pop culture, sports, celebrity updates and general up-to-the-minute marketing. It’s a high impact social media network that brings the latest news to people in real time. It’s one of the most current and up-to-date social media networks and people like the immediacy of the product. The daily Tweet count on Twitter is upwards of 500 million, and there are over 300 million users. And unlike Facebook, anyone at a major event in the world – sports, politics, news, entertainment – is using Twitter to post live updates. This is definitely a big plus point for the social media giant.
  • Social networking sites go through patterns of high and low demand. Twitter is currently on the low side. If Twitter is indeed going through a rough patch, a look at its financials should provide more clarity. Q2 earnings are markedly higher than Q1 earnings at $502 million and ad sales hit $452 million (up 60%). On Wall Street, stocks that exceed forecasts get lots of momentum and stocks that fall short lose all momentum. If Twitter succeeds in increasing its userbase, the stock price will rise.
  • Twitter has plenty of projects taking place behind the scenes in the form of acquisitions that have yet to pay off. For example, Twitter recently inked a 2-year deal with the NFL to showcase additional highlights. Plus, Twitter just spent $100 million on Periscope – an app that makes it possible to live stream on Twitter. And now that the CEO and Founder of Twitter – Jack Dorsey – made an additional purchase of 31K shares in his company, investor sentiment is slightly more bullish moving forward.

Twitter Must Adapt

There is no doubt that Twitter stock is at its nadir now. This also presents many opportunities to buyers who are looking to cash in while the stock is cheap – with positive growth prospects in the pipeline. The real challenge for Twitter remains its mass market accessibility and appeal.

Since high level management made the comment about why Twitter is needed and that many people find it cumbersome to use, there is a lot of interest in rectifying all that is wrong with Twitter. The Project Lightning event at Twitter will allow the company to livestream video thereby allowing users to watch unfolding events.

Twitter however needs to work especially hard on growing its userbase and since it is part and parcel of the highly volatile social media network Twitter is subject to associated fluctuations. As traders, it is important to bear in mind that Twitter faces stiff competition in the form of Snapchat, Instagram, Facebook and other social media platforms. Twitter’s inability to adapt to the exigencies in the marketplace will ultimately lead to its demise.

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Hi, I'm Aaron Crowe. Welcome to CashSmarter. I'm a personal finance freelance writer who enjoys spending my money wisely and using minimalism to make my money last longer while increasing income.