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George Divel Investment Tip#16

Tips on Investment focusing on Energy and the Stimulus Package by George Divel

 

 

In a historic moment, the stimulus package has been signed into law and part of the six key areas in the plan is focusing on renewable energy. The stimulus plan will provide a fix to the tax issues that plagued this industry and stalled critical projects nationwide. It would take several months before the impact of the legislation can take effect and get the industry moving again. However, at this early stage, major players are already gearing up for expected growth and the nation’s direction in developing a Green Economy.

 

Increasing the nation’s energy efficiency can reap enormous economic benefits for the country. Investing in programs to develop more effective energy efficiency measures can reduce demands in energy, create reductions in harmful carbon emissions, and save money for both residential and business owners. Energy efficiency should be viewed as a reserve for hidden energy and a tremendous economic opportunity for investors and the nation is a whole.  

 

This renewed focus on energy can, as experts say, open up floodgates for new investments in various areas in this industry. If you need help identifying which areas, you can look for a mentor like George Divel to help you in your investment journey.

 

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February 23, 2009 Posted by | George Divel, Investment ideas | , , | Leave a comment

George Divel Investment Tip#15

Tips on Investment with the Current Economy by George Divel

 

The administration has now changed hands and people are still speculating on the outlook and trend of the economy in the coming months and years. Although burying your cash in an island somewhere seems like a good idea, financial experts still say that there are still some sensible investment areas even with the current condition of the economy. What is important here is to have a long-term outlook on things. Markets continue to fluctuate but thinking clearly amidst the chaos can help you ride the wave. As I have mentioned in Investment Tips#10 – do not panic. A smart investor never panics but looks for a window of opportunity.

 

One of the best tips in riding the waves of this financial storm is to create a diversified portfolio. Make it well balanced between stocks and bonds. Some experts are saying that this is the correct time to go bargain hunting in the stock market. Make your studies, explore and diversify.  The following are markets suggested by investment professionals that would be worth looking into this year.

 

* Commodities – Energy, precious metal (particularly gold), food and others are basic as it can get.

 

 * Basic Consumer Products – This includes healthcare, food and beverages, personal care, telecommunication.

 

* Blue-chip Stocks – As one financial expert said, stocks are one of the first choices that people opt to sell when the trend goes down. Check out Fortune 500 companies with international sales. These companies are more resilient in standing their ground while the economy collapses.

 

* Financial Services – People reading this might say that this is a foolish tip with the way things are going in the market. But hey, two years from now the country will still be in need of banks and those who survive today’s debacle will reach new heights.

 

With the unpredictability of the current market, it seems getting perfect timing is out of the question. However, financial experts say that you should look into the horizon when looking for areas to invest. If you need help identifying which areas, you can look for a mentor like George Divel to help you in your investment journey.

 

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February 1, 2009 Posted by | George Divel, Investment ideas | , , | Leave a comment

George Divel Investment Tip#14

Tips on Investment Planning by George Divel

 

There are several misconceptions on what forms of investments are the best to take, particularly for those who are new in investing. If you don’t have concrete insights on whatever market you are trying to pursue, don’t make a big mistake in jumping right in with a large chunk of your capital. The keys to success are to learn as much as possible regarding the market and not to make any mistakes and bad strategies previously committed. 

 

Investment planning involves a careful study on where you can actively participate with your money, which can yield you with the highest returns. The following are tips on how to do an effective investment planning.

 

* Identify what areas you are good at and what talents you excel in. Think of ways on how you can utilize and profit from these talents.

 

* Know how much time you can devote to your investment. Allocating time can prevent you from being sidetracked and guide you towards your goals.

 

* Enter a market or investment where you understand the risks, so the possibility of failure will not come as a shock.

 

* Select an investment that you enjoy. An activity that gives you much pleasure can prevent you from being distracted.

 

* Make short-term goals that are easier to achieve, as well as your long-term goals.

 

* Learn from the previous years’ successes and failures in the field of investments. Avoid the pitfall of making the same mistake that previous investors have already committed.

 

* Put all your investment plans in writing. Continue to make notes related to your investment everyday. Reflect on them regularly and make adjustments as necessary. Don’t get easily overwhelmed by early failures.

 

* Monitor your progress by documenting your milestones and achievements along the way. Let these indexes inform you if you need to make additional investments in time or money.

 

* Find a mentor like George Divel to help you in your investment journey. Learn from their mistakes. Be inspired by their successes.

 

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January 16, 2009 Posted by | George Divel, Investment ideas | , , , , | Leave a comment

Tip # 13 George Divel on Fixed Income Investing

These are tough times for fixed income. Interest rates are low, which is good if you have the credit to borrow money. But its not so good if you are investing for income.

CD’s and money market rates are at historic lows. So where’s the best place to put your fixed-income holdings?

It depends, of course, on your time horizon, tax situation and stomach for risk. Generally, though, under today’s conditions it doesn’t pay very well to tie your money up for the long term.

Top-rated five-year municipal bonds, for example, pay the equivalent of nearly 4.7 percent for investors in the 28-percent tax bracket. At the same time, a five-year Treasury note yields just 3.4 percent.

To stimulate a growing economy, the Federal Reserve has cut short-term interest rates — the Fed funds rate — to 4.25 percent, down from 5.25 percent just a few months ago. While there is lots of speculation about whether the Fed will hold rates steady or cut further, not many analysts expect it to raise rates, which it does to head off inflation.

Botton line: be careful. If you invest in a long term bond to get a higher dividend, you could suffer large losses in the price of the bond when interest rates go up.

All the more reason to talk to your financial advisor on a regular basis.

June 23, 2008 Posted by | Uncategorized | Leave a comment

George Divel Investment Tip # 12 Advice for new Grads

George Divel recently spoke to Mainstreet. com and had a lot of great advice for new grads starting their first job.

Read about it at: http://www.mainstreet.com/tmmm?month=June&year=2008

June 4, 2008 Posted by | Uncategorized | Leave a comment

George Divel Investment Tip # 11

Shop for Stock Bargains — But shop carefully

Now that the stock market has been pounded down, bargain hunters tend to look around for stocks whose prices seem much less than their true value. One type of bargain hunter pursues stocks that pay a dividend, on the theory that the income from the dividend assures the quality of the investment.

This certainly can work. But like most investment strategies, it is easily misapplied.

If you are thinking of picking up some shares of dividend-paying stocks that are taking a beating you need to see whether the dividend payouts are showing signs of strength and rebound — making a stock a bargain — or whether they are warning investors that the shares are due for a collapse.
Remember, dividends are not fixed, they can change according to the fortunes and policies of the company. If a dividend yield gets to be “too good to be true” it is a good bet that the company will soon cut that dividend and when they do the shares are likely to decline in value.
The best way to play the bargain hunting game is to do your homework and consult with an experienced investment advisor.
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May 6, 2008 Posted by | Uncategorized | Leave a comment

George Divel Investment Tip #10

Don’t Panic

With real estate values plummeting and prices of commodities from gasoline to food steadily increasing, there is the danger that investors will panic. This is never a good idea. Nobody can predict the future, but unless you really believe that the world is coming to an end, the best strategy for investors is to make the most of the current investment environment. Here are some ideas:

1. Learn from the mistakes of others. Greed and excess categorize the recent housing debacle. Remember that whenever a situation occurs where 1+1 =3, learn to be skeptical. If the investment banks and mortgage bankers had done this, the devasation would have been avoided.

2. Control your debt. Don’t take on more debt than you can comfortably handle. Debt is great when markets are booming, but can be deadly when values fall. If you borrow a million dollars to buy a house and the value of the house drops to half — you still owe what you borrowed. The same idea works in other markets, no matter how great the potential of a stock, it may not make up for the dangers of buying that stock with margin (borrowed money.)

3. This is the most important rule of all. If you have suffered setbacks in the real estate, stock or bond markets, don’t try to make up your losses all at once. Just as most gamblers who keep doubling their bets to get even rarely succeed, so it is with other markets as well.

The best thing you can do is to choose quality investments with the knowledge that excesses in markets usually even out long term.

With the stock markets currently depressed, many great companies are selling for much less than they were a few years ago. If you don’t panic and keep focused on true value, this could be a good time to add profitable long term investments to your portfolio. Talk to your investment advisor for advice.

April 23, 2008 Posted by | Uncategorized | Leave a comment

George Divel Investment tip #9

Reasons to Re-Balance Your Portfolio

Many advisors recommed rebalancing one’s portfolio on a regular basis. But what about the argument that rebalancing really means taking winnings out of your investments that have done the best and putting them into those that have done the worst. Does this really make sense?

Actually it does, for two good reasons.

First, rebalancing really mean “buy low, sell high.” When an asset class rises in value, you trim it back (selling some high) to beef up your holdings in other asset classes. It’s a mechanical discipline, like dollar-cost averaging, that over a lifetime tilts the odds in your favor.

Second, rebalancing works best when referring to asset classes not individual stocks. With stocks, a good rule of thumb – or at least a rule of thumb to consider, especially in a taxable account – is to “cut your losses and let your winners ride.” With asset classes . . . like “U.S. Equities” or “International Equities” or “Cash” or “Long-Term Bonds” or “Real Estate Investment Trusts” or “Commodity Funds” . . . it’s unlikely that the relative advantage of one asset class will just keep gapping ever wider for decades relative to the others.

So just as dollar cost avering (investing a fixed amount on a fixed schedule, regardless of the market price) is a good overall investment strategy…. so is periodically balancing your portfolio to adhere to your overall financial plan for asset class diversification.

Of course, your investment goals change with your personal situation and time line. Make sure that your portfolio is keeping pace with your goals by consulting with your financial advisor regularly.

April 23, 2008 Posted by | Uncategorized | Leave a comment

George Divel Investment Tips #8

Stocks for the Long Term

Recent stock market volatility has forced investors to consider the wisdom of investing in stocks. If you look at short term results, it does seem that investing in stocks can be a terrible strategy.  Remember back to  Oct. 19, 1987? Stocks experienced the worst one-day drop in stock market history  down 22.6 percent. More recently, the shocks have been prolonged and painful. For example,  if you had invested in a NASDAQ index fund at the time of the market’s peak in March 2000 you would have lost three-fourths of your money over the next three years!

Pretty scary.

But on the other hand, in the long term, there has been no better investment than stocks.   From 1926 to 2006, the S&P 500 returned an average annual gain of 10.4%. The next best performing asset class is bonds. Long term U.S. Treasury notes returned, on average, 5.9 percent over the same period.

It is difficult to keep these results in mind when the stock market is plunging hundreds of points, but most of the time, this is a good idea. The impulse at those times is to sell all stocks and run for the hills.  But it is important not to let your emotions manage your investments.

If you pick good companies, or good stock mutual funds or index funds, over time you will do better than most other types of investments.  Of course, you also have to consider your investment time horizon but if you are a long term investor, stocks need to be part of your strategy.

Of course, you should consult with your investment advisor to make sure that your portfolio is diversified and suitable to your particular financial needs.

April 3, 2008 Posted by | Uncategorized | Leave a comment

George Divel Investment Tips #7

With the fixed income and equity markets showing so much volatility, many investors are taking a fresh look at an old favorite: the Certificate of Deposit (CD). Investors searching for relatively low-risk investments that can easily be converted into cash often turn to certificates of deposit (CDs). A CD is a special type of deposit account with a bank or thrift institution that typically offers a higher rate of interest than a regular savings account. Unlike other investments, CDs feature federal deposit insurance up to $100,000.

Here’s how CDs work: When you purchase a CD, you invest a fixed sum of money for fixed period of time – six months, one year, five years, or more – and, in exchange, the issuing bank pays you interest, typically at regular intervals. When you cash in or redeem your CD, you receive the money you originally invested plus any accrued interest. But if you redeem your CD before it matures, you may have to pay an “early withdrawal” penalty or forfeit a portion of the interest you earned.

Although most investors have traditionally purchased CDs through local banks, many brokerage firms and independent salespeople now offer CDs. These individuals and entities – known as “deposit brokers” – can sometimes negotiate a higher rate of interest for a CD by promising to bring a certain amount of deposits to the institution. The deposit broker can then offer these “brokered CDs” to their customers. Ask your investment advisor for more information about CDs. 

March 18, 2008 Posted by | Uncategorized | Leave a comment