Saturday, March 17, 2012

WORLD FOREX: Euro Stalls As EU Summit Looms – Wall Street Journal

Reuters UK
WORLD FOREX: Euro Stalls As EU Summit Looms
Wall Street Journal
By Siva Sithraputhran Of DOW JONES NEWSWIRES LONDON (Dow Jones)–The euro held above .40 in European foreign exchange trade Monday as the focus switched to an emergency summit of euro-zone leaders scheduled for Thursday, having drifted down in the
FOREX-Euro falls broadly; markets on edge over debt crisisReuters
Forex – Focus Back on EU Debt Crisis & Policy Makers
Forex – Swiss Franc and New Zealand Dollar Stand Out in Early Weekly
DailyFX -Best Syndication -Forex Pros
all 655 news articles »

{forex} – Google News

Don't Get Too Worked Up Over Titanium Metals' Earnings

Although business headlines still tout earnings numbers, many investors have moved past net earnings as a measure of a company's economic output. That's because earnings are very often less trustworthy than cash flow, since earnings are more open to manipulation based on dubious judgment calls.

Earnings' unreliability is one of the reasons Foolish investors often flip straight past the income statement to check the cash flow statement. In general, by taking a close look at the cash moving in and out of the business, you can better understand whether the last batch of earnings brought money into the company, or merely disguised a cash gusher with a pretty headline.

Calling all cash flows
When you are trying to buy the market's best stocks, it's worth checking up on your companies' free cash flow once a quarter or so, to see whether it bears any relationship to the net income in the headlines. That's what we do with this series. Today, we're checking in on Titanium Metals (NYSE: TIE  ) , whose recent revenue and earnings are plotted below.


Source: S&P Capital IQ. Data is current as of last fully reported fiscal quarter. Dollar values in millions. FCF = free cash flow. FY = fiscal year. TTM = trailing 12 months.

Over the past 12 months, Titanium Metals burned $96.1 million cash while it booked net income of $114.0 million. That means it burned through all its revenue and more. That doesn't sound so great. FCF is less than net income. Ideally, we'd like to see the opposite.

All cash is not equal
Unfortunately, the cash flow statement isn't immune from nonsense, either. That's why it pays to take a close look at the components of cash flow from operations, to make sure that the cash flows are of high quality. What does that mean! ? To me, it means they need to be real and replicable in the upcoming quarters, rather than being offset by continual cash outflows that don't appear on the income statement (such as major capital expenditures).

For instance, cash flow based on cash net income and adjustments for non-cash income-statement expenses (like depreciation) is generally favorable. An increase in cash flow based on stiffing your suppliers (by increasing accounts payable for the short term) or shortchanging Uncle Sam on taxes will come back to bite investors later. The same goes for decreasing accounts receivable; this is good to see, but it's ordinary in recessionary times, and you can only increase collections so much. Finally, adding stock-based compensation expense back to cash flows is questionable when a company hands out a lot of equity to employees and uses cash in later periods to buy back those shares.

So how does the cash flow at Titanium Metals look? Take a peek at the chart below, which flags questionable cash flow sources with a red bar.


Source: S&P Capital IQ. Data is current as of last fully reported fiscal quarter. Dollar values in millions. TTM = trailing 12 months.

When I say "questionable cash flow sources," I mean items such as changes in taxes payable, tax benefits from stock options, and asset sales, among others. That's not to say that companies booking these as sources of cash flow are weak, or are engaging in any sort of wrongdoing, or that everything that comes up questionable in my graph is automatically bad news. But whenever a company is getting more than, say, 10% of its cash from operations from these dubious sources, investors ought to make sure to refer to the filings and dig in.

With 17.1% of operating cash flow coming from questionable sources, Titanium Metals investors should take a closer look at the underlying numbers. Wit! hin the questionable cash flow figure plotted in the TTM period above, changes in taxes payable provided the biggest boost. Overall, the biggest drag on FCF came from capital expenditures.

A Foolish final thought
Most investors don't keep tabs on their companies' cash flow. I think that's a mistake. If you take the time to read past the headlines and crack a filing now and then, you're in a much better position to spot potential trouble early. Better yet, you'll improve your odds of finding the underappreciated home-run stocks that provide the market's best returns.

We can help you keep tabs on your companies with My Watchlist, our free, personalized stock tracking service.

  • Add Titanium Metals to My Watchlist.

MintFamily with Beth Kobliner: What 5th – 8th Graders Need to Know About Money

One of the best parts of my job is actually talking to kids about money. Of course, I conduct my own research with my personal lab rats: my three kids! But it�s always a treat to speak at schools, where I can connect with children I don�t know and who haven�t been inundated with my money mania. So I was thrilled to speak recently to the middle schoolers at The Children�s Storefront, an independent, tuition-free school for pre-schoolers through eighth graders in Harlem, New York City.

Upon entering the school�a converted brownstone with bright blue painted gates�you immediately sense that it�s an extraordinary place. Academically rigorous and creative, the school takes as one of its guiding principles the importance of inspiring kids to believe that if they work hard, they can go to college and be anything they want to be. The students are especially lucky to have wonderful leaders like Michael Williams, the assistant head of school, who hosted the event. He had such a lovely, patient way of speaking that reinforced the school�s values and showed the students that he respected each of them.

First, Mr. Williams interviewed me, talk-show style, with lots of questions about my childhood and how I chose my career. I felt like I was on Oprah! He asked about my parents, who were also educators and have been married for 60 years. Mr. Williams said, �Wow! Can we get a round of applause for Beth�s parents?� I was �kvelling,� as they say. Very proud!


Then came my presentation: The five money lessons every kid from 5th to 8th grade should know:

It�s important to wait.

As I mentioned in my last post, the ability to delay gratification leads to fewer behavioral problems, lower stress, stronger friendships, and even higher SAT scores!

Save, save, save!

Waiting is a lot like saving. We all have things we�d like to buy (like the designer jeans I wanted, but couldn�t afford! , as a k id), but it�s important to prioritize saving. After all, if you saved $1 a day starting at age 15, you�d have $80,000 by age 65�that�s a lot of money!

Don�t get into credit card debt�ever!

Say you buy an iPhone for $200. If you purchase it with a credit card that charges you 18% in interest, and you only pay the minimum, you�ll end up paying $225 over nearly a year and a half�$25 in interest! Maybe that doesn�t sound like a whole lot extra, but more is more, and it adds up when there are lots of purchases or more expensive items. It�s just not worth it.

College is one of the best investments you can make.

As the child of two teachers, I always say education is the ticket to your future. And going to college pays off: People who graduate earn nearly *twice* as much as people who don�t, not to mention you have more choices in your life and can follow a passion. But college is expensive, and it�s important to know a school�s price tag before choosing it. Look into financial aid, loans, scholarships, and grants at, and choose a few schools and play with the �net price calculators� on their websites to get an estimate of how much each will cost.

Follow your dreams� and unexpected opportunities, too.

My career choice surprised me. I was an English major and had no idea I�d end up being a financial journalist. But my first job working for financial journalist Sylvia Porter was life-changing, and I became hooked instantly. Maybe your child�s dream is to be a lawyer or a doctor or a teacher or a writer. Whatever the dream is, encourage your kid to take every opportunity to make it come true. But, if while he or she is working toward that dream, something ELSE comes along that is equally�or even more�appealing, tell your young one not to be afraid to see where that path leads, too.

At the end of my presentation, the kids had tons of questions. One boy bravely asked! , �You s aid to save, but what should you do if you really, really want something?� I�m sure every kid in the room was thinking this! And, let�s face it, we *all* face this debate�especially right now, as the weather warms up and you eye a new spring coat, a brightly colored blouse, or a pretty pair of flats. Priorities, people�we all need to keep those wants in check!

Do you have a child in 5th to 8th grade? What have they asked you about money or careers?

Beth Kobliner is a personal finance commentator and journalist, the author of the New York Times bestseller “Get a Financial Life: Personal Finance in Your Twenties and Thirties,” and a member of the President’s Advisory Council on Financial Capability. Visit her at, follow her on Twitter, and like her on Facebook.

Andean ETF Introduced by Global X

New York-based Global X Funds introduced the Global X FTSE Andean 40 ETF on Thursday. The ETF provider says it is the first ETF to target this region.

The Andean region, comprised of Chile, Colombia and Peru in the ETF, has been a top-performing stock market region, says Global X. (The ETF does not include the Andean country of Ecuador).  And the new ETF will “allow investors to take advantage of a pending agreement to merge the stock markets of Chile, Colombia and Peru, which will create the second largest stock exchange in Latin America after Brazil’s and 50% larger than Mexico’s,”  the company stated in a press release.

According to Russell Investments, returns in Chile were 51.1%  last year and 48.5% in Colombia.

“We are excited to provide a benchmark and investment vehicle to the combined Chile, Colombia and Peru exchanges,” said Bruno del Ama, CEO of Global X Funds, in a statement. “Because of its geographic size, the Andean region is an important investment opportunity underserved by the current Latin American ETF options.”

The Global X FTSE Andean 40 ETF tracks the FTSE Andean 40 Index, designed to measure the performance of the 40 largest and most liquid companies in the Chilean, Colombian, and Peruvian markets.

As of January 26, 2011 the three-largest components for in the ETF were Southern Copper Corp., Minas Buenaventura, and Pacific Rubiales Energy.

On Friday, the Andean ETF was trading down roughly 1% at $14.75.

The Global X Interbolsa FTSE Colombia 20 ETF (GXG) moved town 1.5% to trade at about $40.30.

The iShares MSCI Chile Index Fund (ECH) declined about 1% to trade near $70, while the iShares MSCI Emerging Markets Index Fund (EEM) was off 0.28% at $46.40.

Earlier this week, EPFR Global said emerging-stock stock fund outflows reached their highest level in three years, hitting more than $7 billion for the week ended Wednesday.

According to Lipper data released Thursday, foreign stock funds, both ETFs and mutual funds, had about $4 billion in outflows for the week.

With over $1 billion in managed assets as of December 31, 2010, GlobalX says it is one of the fastest-growing ETF providers in the world with a focus on global commodities, international and emerging-markets fund suites.

On January 25, 2011, Global X Funds rolled out the Global X Russell Emerging Markets Growth ETF (EMGX) and the Global X Russell Emerging Markets Value ETF (EMVX).  And on January 5, it introduced the Global X Aluminum ETF (ALUM), the first ETF globally focused on aluminum, according to the company.

Fix Your 401(k) -

Every day, millions of Americans give their investments the serious attention they deserve, riffling through the business pages, tracking the markets and grappling with tough questions. Do I need more exposure to stocks -- or less? How worried should I be about the euro? Am I going to need to save more to retire on time? But there's a major question often hiding in plain sight, one so fundamental to people's financial health many don't even think to ask it: Is my 401(k) plan any good?

Inside the April Issue

  • Fix Your 401(k)
  • The Big Business of 401(k) Plans
  • 10 Things Campaign Managers Won't Tell You
  • 9 to 5 -- at 75
  • Real Estate: When High Rents Are a 'Buy' Signal

Certainly, few of us need to ask whether the plans matter: We've resigned ourselves to our dependency when it comes to retirement savings. Americans now hold $4.3 trillion in 401(k)s and similar defined-contribution plans, nearly three times as much as the $1.6 trillion parked in annuities. The plans weren't originally designed to be the nation's primary retirement lifeline -- they started as a minor tax perk for senior executives -- but they've grown inexorably, as ever more big companies have used them as a cheaper alternative to traditional pensions. Only about a third of the corporate wo! rk force can look forward to a monthly pension check today, down from 80 percent three decades ago; over the same period, assets in 401(k)-like plans have grown 16-fold.

And yet, as many economists and money pros know and as more employees are beginning to realize, the plans are riddled with problems capable of tripping up even the most diligent investors. The laundry list of pitfalls includes high (and often hidden) expenses that eat up enormous chunks of plan members' gains, as well as company-provided advice that critics say ranges from vague to nonexistent. Some consumer advocates say that too many employers treat their plans as an afterthought -- and that the financial-services industry, which collects between $30 billion and $60 billion a year in fees from such plans, has little incentive to change things. So it often takes Norma Rae-like activism to get a company to improve its plan lineup -- which means that, for many Americans, picking the components of their 401(k) may be the biggest financial decision they never get to make. "I personally think the 401(k) should be abolished," says Matt Goff, a Houston financial adviser whose practice serves small-business owners needing help with their company retirement plans.

To be sure, some conscientious companies are working to make their plans better; federal regulators are getting involved too, with new rules that may make it easier for investors to see what they're actually paying for their plans. But for most investors, advisers say, it doesn't make sense to wait for the cavalry to come. Here, some of the best advice for cutting costs, finding better funds or even going outside an employer's plan to launch a 401(k) repair project.

The New "Target": Cutting Costs

Are They Worth the Price?

Target-date funds are now the anchor of many investors' 401(k) plans, but critics have faulted some funds for high expenses a! nd so-so performance.

Americans now hold $343 billion in target-date funds, up threefold in six years, and they're buying them mostly through their retirement plans. These funds are the cafeteria lunch of mutual funds: They include all the basic food groups, so investors don't have to order la carte. The funds invest in a mix of stocks, bonds and other investments that gets more conservative as an investor's retirement, or target date, approaches, rebalancing automatically for investors who prefer not to or don't know how to do it themselves. Congress passed a law in 2006 making it easier for employers to use target-date funds as a default 401(k) option, and 81 percent of large employers now offer them.

But for some cost-conscious investors, the expenses built into target-date funds are a growing peeve. Most such products are "funds of funds" that spread assets among multiple other investment vehicles. As a result, target-date-fund expenses span an unusually wide range. Vanguard's target-date products, which rely heavily on index funds, have average expenses of $18 a year per $10,000 invested; at the opposite extreme, Oppenheimer uses actively managed funds and charges $168 per $10,000. And investors at smaller companies are more likely to face fees at the higher end of the range. The differences can add up. According to human resources consultant Towers Watson, an increase of just $50 per $10,000 in target-date-fund fees could cost a high earner the equivalent of eight years' worth of retirement savings over the length of his career.

Target-Date Funds: What to Ask

How did you do in the crash?

Planners say that anyone considering a target-date fund should see how that! fund fa red during the 2008-09 financial crisis. Among target-date funds geared for workers who planned to retire in 2010, the average fund lost 22 percent in 2008, but some lost as much as 40 percent.

Am I the kind of investor you target?

Target-date funds have a lot of assumptions about investor behavior baked into their structure. Many hold plenty of volatile assets, like stocks, even as they pass their retirement target dates, assuming investors won't need to tap the money right away and can take some risks with it. Others are already filled with bonds, assuming that investors will cash out the day they retire. Savers whose needs or plans don't match a fund's assumptions might not find the funds to be a good fit.

Can I get your funds separately -- and cheaper?

Some investors and advisers check a target-date's overall expense ratio, then compare that fund's individual components to similar index funds in the same 401(k) plan. In some cases, employees find they can build a comparable portfolio at a fraction of the cost.

Do you diversify me?

Some investors say it can be worth holding on to a target-date fund if it offers investments that you can't get elsewhere in your 401(k), like commodities or REITs, which can smooth returns in rocky markets.

To be sure, some investors say it's worth paying more for the convenience of the all-in-one funds; what's more, the funds sometimes have access to assets like gold or foreign stocks that employees can't get elsewhere in the plan. Still, some do-it-yourselfers are opting to cook from scratch rather than accept the cafeteria tray. Atlanta adviser Jeffrey Baumert, who helps small-business owners design plans, says he'll sometimes encourage folks whose plans include Fidelity's Freedom funds to try an alternative. Freedom funds' expenses average $74 per $10,000, an! d Baumer t says his clients can do better -- they can get exposure to large-cap stocks, for example, through the inexpensive Fidelity Spartan 500 Index fund. "Do you really think that all their fund managers in every category are going to be the best?" he asks. (Fidelity says its active management is designed to deliver better returns in the long run.)

Some advisers advocate an even simpler rule of thumb: When possible, use only index funds. That's because the typical 401(k) fee structure makes the substantial expense gap between indexes and active funds even wider. "Packagers" -- companies like Fidelity, Vanguard or other middlemen -- collect a substantial share of their 401(k) plan revenues from active funds. Active large-cap stock funds, for example, route an average of $21 per $10,000 invested to cover back-office expenses like accounting and record-keeping, according to human resources consultancy Aon Hewitt (a firm which itself sometimes acts as a packager). The average large-cap index fund, in contrast, routes just $6, and at least half such funds don't charge those fees at all. Ultimately, investors in actively managed funds are subsidizing their coworkers, says Dave Gray, head of retirement plan product development at Charles Schwab; using index funds means getting that subsidy, instead of paying it.

Comparing Plans on Cost

Soon, employers will be required to make more detailed disclosures of their plans' costs. But for more data, experts say, investors will still have to dig into companies' regulatory filings.

Cheap: IBM
(Plan run by Fidelity)

The sheer size of the plan, which has more than 200,000 participants, helps keep costs down, since bigger 401(k) programs usually get heftier discounts on fund expenses. But the plan also emphasizes cheaper index funds, including index options for real estate investing and inflation-protected bo! nds.

Average: Abercrombie & Fitch
(Plan run by Fidelity)

Members of the fashion retailer's plan have access to some index options, but most of the choices are more costly, actively managed funds, including Fidelity's target-date funds. (Fidelity says the active management of those funds gives investors a long-term performance edge.)

Expensive: Take-Two Interactive Software
(Plan run by The Principal Group)

Most funds in the video-game maker's plan are more expensive than average. To use the main stock index fund, employees pay $42 per $10,000 invested, more than twice what an all-but-identical fund costs outside the plan. Principal says the costs are typical for a plan of this size.

Data as of latest federal filings.
Sources: Brightscope; Federal Filings

Expanding Your Choices: The 401(k)-Plus

What's Missing From the Menu

Since the financial crisis, advisers say, 401(k) investors have been more likely to look for alternatives to plain-vanilla stock and bond funds. But surprisingly few plans have adapted to give them what they want.

When the U.S. financial system went haywire in 2008, many Main Street investors started searching for commodities, foreign bonds and other alternative investments that had a chance to stay afloat when U.S. stocks sank. But if they went looking in their 401(k)s, advisers say, chances are they found nothing -- and, more surprising still, even now, many plans haven't adapted. Excluding target-date products, the average plan has just 13 funds, only one more t! han befo re the crash, according to Aon Hewitt. And the very categories they're missing are the ones that employees could be using to hedge against a choppy stock market. Less than half of plans have a bond index fund, for example, and only about one in four includes real estate funds.

A minority of larger 401(k)s give their employees a relatively simple way to get what they're missing, sponsoring a "brokerage window" that lets investors buy funds that aren't in the plan lineup, along with stocks and ETFs in some cases. But for many employees, experts say, it's a costly proposition. Trading commissions tend to be noticeably higher on such transactions than on the same ones made through a discount broker, for example, and investors won't get the "institutional" discount on fund shares. The result is you'll pay more for the investments you want -- "like buying hot dogs at the ballpark," says financial adviser Robert Schmansky, who helps employers choose 401(k) plans.

Beyond Your 401(k): What to Ask

What's my match?

Financial advisers say investors should almost always contribute enough to get their 401(k) plan's full match -- most years, their investments would have to have a great run to make up for the money they would have left on the table.

Can I climb out the window?

About a fifth of large companies have a "brokerage window" that offers access to a bigger range of investments -- though using it means paying fees and commissions. Some advisers recommend minimizing costs by using the window only once a quarter or once a year.

What if I go out on my own?

Investors without a brokerage window can find more investment options by opening an IRA or a Roth IRA. For 2012, the maximum contribution for such plans is $5,000 for those under 50 and $6,! 000 for those 50 and older.

When can I leave?

When workers switch jobs, they can roll their 401(k) plan balance into an IRA. Otherwise, they're stuck, with one noteworthy exception: In many plans, those who turn 591/2 become eligible for an "in-service rollover," even if they stay with their company.

The upshot is that some employees have decided, in a sense, to take the money and run. They contribute just enough to their plans to get a company match, then set up separate retirement accounts that can fill the holes in their 401(k)s. Aircraft giant Boeing has leveraged its huge work force -- its 401(k) has around 200,000 enrollees -- to get low fees in its plan, which includes plenty of low-cost index funds. But the plan lacks funds that focus on holdings that money managers say can help smooth returns in rocky markets, including REITs and Treasury inflation-protected securities. It also lacks specific funds for emerging-market and foreign small-cap stocks. As a result, advisers say, many Boeing employees have built their own shadow 401(k)s. Lowell Lombardini-Parker, a financial planner in Seattle, says he's dealt with dozens of clients from the company, helping them buy low-cost funds targeting those asset classes. His philosophy: "Use what you can. But if you have to, go outside the 401(k)." (Boeing says its own plan includes a "prudent" menu, and that its narrow range of options is designed to not overwhelm unsophisticated investors.)

The double-barrel strategy isn't necessarily the right fit for everyone. Because a matching contribution from an employer is essentially free money, planners say investors should always collect fully on that. And higher-income workers may not be able to make tax-deductible contributions to outside accounts if they also have a 401(k). In that case, Lombardini-Parker says, it may still make sense to put money in a taxable retirement account. Many advisers recommend that investors leave REIT! s and TI PS out of such accounts -- since they tend to throw off taxable income -- and use them instead for equity funds and other stock investments that they plan to hold for a while.

Where the Advice Is... and What It Costs

Advice From Your Company

  • Cost: Usually free.
  • Pros: Can't beat the price.
  • Cons: Only offered by about 60% of firms. Many limit counsel to relatively generic advice.

One-Time, Outside Advice

  • Cost: $500 and up for a review of your finances (based on typical fees).
  • Pros: Clients can mesh 401(k) advice with counsel on issues like college savings and insurance.
  • Cons: It's up to the client to follow the plan; getting follow-up advice often means paying extra.

Full-Time Advice

  • Cost: Typically 1% a year, or $5,000 a year for someone with $500,000 in investable assets.
  • Pros: Advisers handle some transactions for clients and offer guidance on issues like estate planning
  • Cons: Often more expensive than part-time help; some investors with fewer assets feel neglected.
Summoning Reinforcements: Outside Help

On average, 401(k) members fork over $83 per $10,000 invested each year in total fees, according to a recent study by Deloitte Consulting and the Investment Company Institute. For about 60 percent of 401(k) plans, that fee! comes w ith what looks like a corresponding perk -- the opportunity to get investment advice. But according to the Plan Sponsor Council of America, a trade group, only about one in five investors takes advantage of the advice.

Why so little interest? It turns out that the companies' offerings are pretty bare-bones. David Wray, president of the plan council, says the threat of lawsuits means large companies need to make sure that, say, a 60-year-old in Dallas and a 60-year-old in Boston get relatively consistent recommendations, which means the advice is less likely to be personalized. Employers also almost always avoid offering advice about any assets that aren't in the 401(k), like a home or a spouse's savings. The result: "Plan-provided advice tends to be generic," says Wray.

The problem, of course, is that anything that isn't generic can get expensive. Financial advisers can spend hours poring over every investment choice. But their fees often start at 1 percent of an investor's assets, which would effectively double what the typical 401(k) shareholder is already spending on her portfolio. One Goldilocks option: Some financial planners will take on smaller advice projects, counseling investors on a one-time basis for an hourly fee. Brian Terry, a Charlotte, N.C.-based adviser, has seen dozens of 401(k) clients. He gives his clients a rundown of their plan, taking a few hours to help them pick investments; many, but not all, return once a year for a follow-up. His price: $150 an hour. The Garrett Planning Network is one network of hourly-fee planners; others can be found through the National Association of Personal Financial Advisers.

Financial planners have their own idiosyncrasies and agendas, though, and some critics complain that they can drive people into cookie-cutter strategies of their own. Consumer! advocat es say investors should check whether advisers get compensated for recommending any particular investments (a common arrangement among both independent operators and employees of big-name brokerages). When it's time to talk 401(k), advisers say, preparation counts: Think carefully about when you want to retire and how much money you hope to spend, says Lea Ann Knight, a planner from Bedford, Mass., who meets with many clients for similar consultations. And don't be shy about secret ambitions -- like that condo in Maui. Devote your face time with the planner to these goals; let him parse the fine print on investment prospectuses.

And investors who decide that with or without help, their 401(k) just won't cut it can always approach the boss. Retirement consultants say that many employers, no less befuddled by the system, are often happy to hear what employees want. Of course, some may have better luck asking employers to add a single option like a mutual fund than to switch providers entirely. One place to start: Grassroots investing website has a form letter employees can download for free.

Getting Help: What to Ask

Should I take my employer's advice?

Pros say advice from planners hired by the employer can offer investors a quick read on how much to save or whether to buy more stocks or bonds. But when it comes to picking specific investments, they add, getting a second opinion or reviewing independent research is often worthwhile.

What's online?

Morningstar is an invaluable resource for researching mutual funds. At not-for-profit website Bogleheads .org, anyone brave enough to (anonymously) post the details of their financial life can get advice from opinionated volunteers. Of course, with free and anonymous advice, "it's buyer beware," says securities lawyer Edward Rosenblatt.

Can I find out how my plan stacks up?

BrightScope, a financial research firm, has a website that offers ratings of 401(k) plans: The sections on "total plan cost" and "investment-menu quality" offer a sense of how a plan's fund lineup stacks up against others in its industry.

What kind of adviser do I want?

For those whose main financial concern is their 401(k) plan, a one-time meeting with a planner can be cost-effective; for investors with more complex needs, like an inheritance or college education to finance, bringing on someone full-time for an annual or asset-based fee might be warranted.

Photo-illustrations by Stephen Webster for SmartMoney

It's a Bad Time to Be Bearish on Sirius XM

The way some analysts take chances you'd think that Johnny Knoxville was egging them on from the other side of the camera.

Barclays Capital analyst James Ratcliffe is the latest Wall Street daredevil.

Ratcliffe initiated coverage of Sirius XM Radio (Nasdaq: SIRI  ) yesterday with an underweight rating. His near-term price target of $2 -- at a time when other analysts are perched as high as $3 -- is bold. The stock closed yesterday at $2.12.

It's an interesting time to begin covering a company and pointing down. Sirius XM reports its fourth-quarter results tomorrow. Ratcliffe is either going to be crowned a genius or laughed off as a buffoon. There's no in between here.

Cracking open Pandora's box
Ratcliffe is smart enough not to pin his bearish thesis on the runaway success of Pandora (NYSE: P  ) and the crowding automobile dashboard.

Sirius XM has proven that there is plenty of growth for several companies to share.

The satellite radio giant shed 231,098 net subscribers in 2009, only to add 1.4 million accounts in 2010 and another 1.7 million in 2011. Every single year finds more people owning smartphones and buying cars through which they can stream smartphone apps. Pandora's growth in that time has been downright explosive.

Well, if all of this is true, then why is Sirius XM not only growing, but actually accelerating its subscriber rate?

Thankfully Ratcliffe isn't going there, rightfully pointing out that the fast-growing music-discovery service is a "real, but manageable" threat. If anything, Ratcliffe argues -- as many bulls have in the past -- wireless carriers moving to tiered pricing will make Pandora and other "free" streaming content more expensive than consumers think.

Playing the valuation card
Ratcliffe is more logical than passionate about his gutsy coverage initiation. He simply fe! els that Sirius XM is overvalued. The stock's already trading at 14 times his estimated EBITDA target for 2013 and 19 times next year's free cash flow if it was fully taxed.

Instead of Sirius XM, he suggests Liberty Media (Nasdaq: LMCA  ) , which owns a 40% preferred share stake in Sirius XM but is trading at a discount.

I don't have any beef with that final point. I bought into Liberty Media last year for exactly that reason.

Ratcliffe's bearish case is solid, but the problem is that it lacks imagination.

After all, Ratcliffe assumes the revenue growth rate from 2011 through 2018 will run at an annualized rate of a mere 8.6%. He does see EBITDA and free cash flow moving substantially higher -- and rightfully so given the scalable nature of the business -- but does he really think the combination of subscriber growth and increases in average revenue per subscriber will only appreciate at a pace in the single digits?

That's a bold assumption, and one that may get crushed tomorrow.

Guidance light
It's been five months since Sirius XM initiated its outlook for 2012, and it would be a shock if CEO Mel Karmazin sticks to his target of 10% revenue growth for the year ahead. Sirius XM wound up tacking on far more new subscribers during the fourth quarter -- roughly 540,000 to get to 21.9 million subscribers -- to keep aiming that low. There was a 12% rate hike introduced last month. Auto sales have been strong.

Save for a brief lapse in late 2008, Sirius XM has erred on the side of providing conservative guidance that it can bump up later.

If Karmazin doesn't boost his guidance for 2012, the market won't be happy -- and Ratcliffe will be rewarded for his brazen call practically on the eve before Sirius XM's conference call. If the outlook is raised and the stock rallies, he'll look like a chump for the timing of his call.

Through his goggles I can see where Sirius XM and its roughly 6.5 bill! ion full y diluted shares may seem overvalued. Pit Sirius XM against the two largest satellite-based entertainment companies -- DIRECTV (Nasdaq: DTV  ) and DISH Network (Nasdaq: DISH  ) -- and Sirius XM trades at insane relative multiples of revenue and forward earnings.

However, DIRECTV and DISH aren't in the same position as Sirius XM. Sure, folks will always pay more for TV than radio. However, DIRECTV and DISH are at the mercy of their content providers. Sirius XM, for the most part, is its own content provider. Its programming and content costs have actually gone down over the past year, and that's something you will never see happen at DIRECTV or DISH unless they're shedding subscribers.

Sirius XM doesn't have insane pricing elasticity given the limited market of people who spend enough time in their cars to make the service worthwhile, but this is still a monopoly on premium radio in an era where terrestrial radio isn't getting any better and tiered pricing along with throttling will eat into fans of smartphone streaming.

We'll see if Ratcliffe is right tomorrow, but it certainly seems as if he picked the wrong week to come out as a Sirius XM bear.

Still a bull
I remain bullish on Sirius XM's future. It should come as no surprise that I'm promoting the CAPScall initiative for accountability by reiterating my bullish call on Sirius XM for Motley Fool CAPS.

XM Satellite Radio was a Rule Breakers recommendation before the Sirius XM merger. It's gone from the scorecard, but if you want to discover the newsletter service's next rule-breaking multibagger, a free report reveals all.

Friday, March 16, 2012

Wall Street Like A Rolling Stone

So how does it feel? To be on your own? With no direction home?

Like a rolling stone?

Wall Street figures to cap off what has been nearly three weeks of a surprisingly determined and constructive move higher with?exactly the kind of taciturn – bordering on milquetoast – trading session that the skeptics expected to see this month.


Futures have flattened out, picking up the mantle from Thursday’s indifferent trading session, when the Dow Jones Industrial Average (DJI)?flattened out with an eight-point loss on the close.

This lethargy, though,?qualified as uncharacteristic. While most market watchers expected September to represent a big challenge – both because the month historically has been?Wall Street’s most disappointing, and because stocks entered the month with valuations so stretched – the action has been surprisingly determined and constructive. Thursday’s skimpy setback proved just the second session in the last 10 to show a loss for the Dow. Though gains for the market averages have been?catwalk-model skinny?for most of those advancing sessions, the bulls clearly maintained their advantage, and haven’t really let the bears break service at any point in the month.

Friday’s session figured to be identified more for what it?it’s missing than for what it offers. There isn’t much in the way of data, robbing the market of what has been the single greatest contributor to its constructive tone. Most economic readings lately have incited?traders to revive the recovery trade. They won’t have those catalysts in a data-free session Friday.

What there?will be is the hint of the kind of volatility that has been notably absent recently. The CBOE Volatility reading – the VIX – slipped to its lows for the ye! ar earli er this week at just below 23,?though there has been a?steady pickup in volume as the month has ambled on.

There could be a jolt more of both volume and volatility in Friday’s session?amid the unwinding of options positions in this?quarterly expiration of derivatives. The last two months, the options windup has contributed?a bullish tone to the market, but there’s a risk the opposite could be the case Friday.

Most of the other capital markets?have taken a jug-handle turn in Friday’s session.?The dollar, which retreated to the lows for the year earlier this week, has bounced fof?its bottom. Treasuries, which rose in price Thursday, have flattened out Friday, though the two-year note continued to?offer a yield south of one percent. Crude has flattened at about $72 a barrel. Even gold has been tamed, though the pricing environment stayed above $1000 an ounce.

Best Wall St. Stocks Today: AIG,GM,TESO,AAPL

AIG (NYSE: AIG) continues to try to pay back the $182 billion bailout that it received from the federal government, which means from�the taxpayers. It announced another stage in the process. It will sell a piece of its large Asia operation — AIA — for about $6 billion. The U.S. government owns 44% of AIG and wants to continue to chop down that stake. The trouble with the effort to recoup the money is similar to attempts with General Motors (NYSE: GM), Chrysler, Fannie Mae and Freddie Mac. The money that was invested�will never be paid back entirely. That leaves the government, and taxpayers, to answer the question of whether the bailouts were worth it.

China�s Budget

China has made two announcements about its budget. One was that it has revised its growth forecast to 7.5% for 2012. For an economy�that has grown at a rate of 10% over the past decade, the lower level is practically a recession. China says it will try to hedge its challenge with exports due to a slow global economy with a drive to increase consumption within its own borders. That�decision may not make sense. China�s consumer activity relies on factory employment, which relies on exports. China also said it would increase its defense budget by 10.5%. The total is only about a quarter of the U.S.�s, but the People�s Republic believes it has to make the investment. To some extent that is because of America�s military presence in Japan, South Korea and Taiwan. Of course, one advantage to the spending is that it will create jobs. Perhaps that will help China�s other goal of increase consumer spending.

Tesco to Add Jobs

Tesco (NASDAQ: TESO), the largest retailer in the UK, will add 20,000 jobs. It already employs 270,000 people in the country. The government lauded the investment by Tesco�as the kind of decision that will help get the�UK economy on track. Britain is close to another recession. Some economists argue that its austerity programs have gone too far, triggering th! e layoff s of tens of thousands of government workers. Tesco�s action cannot entirely offset those jobs cuts, but the decision is a sign that private enterprise in the UK is not altogether crippled.

Apple in the News

It is impossible to keep Apple (NASDAQ: AAPL) out of the headlines. The company announced its App Store had reached�its 25 billionth download. Just behind that news are reports that the Apple iPad 3, which is supposed�to be launched in the next few days, will cost the same as the iPad 2. The decision could cause more than the normal surge in interest that most new Apple products get. The new iPad is the first of any Apple devices to run on superfast 4G wireless networks. These networks have been the most widely promoted service of the big wireless companies in the U.S. Apple, in essence, will enter an entirely new market with a new product. And the iPad 3 likely will be followed soon by a 4G-enabled iPhone 5. It is another entirely new cycle to boost Apple�s already staggering sales increases.

Douglas A. McIntyre

BP up after settlement; energy stocks dip

NEW YORK (MarketWatch) � Energy stocks fell with the broader equities market Monday, as BP PLC�s settlement with plaintiffs in the 2010 Macondo oil spill failed to provide much of a lift for the sector.

Helping drag on energy stocks, the Dow Jones Industrial Average DJIA �dropped 15 points, as Exxon Mobil Corp. XOM �rose 0.8% and fellow blue-chip component Chevron Corp. CVX �ended the session with a drop of 0.3%.

Click to Play

BP strikes Gulf of Mexico settlement

The oil major has reached a $7.8 billion settlement with residents and businesses over the 2010 oil spill. But BP still has a bigger battle to face with the U.S. government. (Photo: AP.)

Among sector benchmarks, the Philadelphia Oil Service Index OSX �moved down by 1.6%, with components Weatherford International Ltd. WFT and Nabors Industries Ltd. NBR �off by more than 4% each.

The NYSE Arca Natural Gas Index XX:XNG �ended about flat and the NYSE Arca Oil Index XX:XOI �dipped 0.2%.

Energy stocks in the S&P 500 index SPX �dropped 1%, on average, with First Solar Inc. FSLR �down about 7%, Alpha Natural Resources Inc. ANR �falling 6% and Peabody Energy Corp. BTU �down by 4%. On the up side, WPX Energy Inc. WPX �rose 2.8%.

BP clears legal hurdle, shares rise

U.S.-listed shares of BP BP UK:BP �rose 1% after the oil major reached a $7.8 billion settlement with plaintiffs in a suit over the 2010 Macondo oil spill in the Gulf of Mexico. See story on BP�s latest oil spill settlement.

But BP could still be on the hook for up to $40 billion more in legal action from the federal government and other parties, according to reports.

�We remain cautious on BP while there are still significant issues around the cost of the spill to be resolved,� analysts at Bernstein Research said in a note to clients on Monday. �We also see limited organic growth and will want to see more signs of exploration success before becoming more positive.�

Raymond James analyst Pavel Molchanev said the settlement, �removes a considerable portion of BP�s legal overhang, though by no means all of it! .�

BP management believes that the company has already declared enough dollar loss provisions on the spill to handle upcoming legal costs, Molchanev said.

Among other stocks in Monday�s spotlight, El Paso Corp. EP �said it�s adjourning until Friday a shareholder vote on its merger with Kinder Morgan Inc. KMI �. The company said it�s allowing additional time for stockholders to consider a Feb. 29 Delaware Chancery Court opinion over the merger.

While the judge in the case didn�t block the deal, some El Paso shareholders argued that the merger contained conflicts of interest involving Goldman Sachs Group GS �and El Paso CEO Douglas Forshee.

The judge�s opinion focused on Goldman�s private equity arm owning 19% of Kinder Morgan while other parts of the firm served as a banker for El Paso; also Forshee had private interest in buying some of El Paso�s exploration unit from Kinder Morgan after the merger was completed.

Also in the energy spotlight, Exco Resources Inc. XCO �named Wilbur Ross to its board of directors. Ross, who runs private equity firm WL Ross & Co. LLC, owned about 13.7% of Exco Resources common stock, worth about $200 million. Shares of Exco fell 5%.

Cetera Financial to Acquire Genworth FIS Broker-Dealer

Cetera Financial Group announced Monday that it would acquire the independent broker-dealer Genworth Financial Investment Services Inc. (GFIS), from Genworth Financial. The proposed acquisition is scheduled to close in approximately 90 days, pending regulatory approvals.

Valerie BrownIn an interview on Monday with AdvisorOne, Cetera CEO Valerie Brown (left) and Genworth FIS President and CEO Enrique Vasquez declined to disclose the financial details of the acquisition, but Brown said that “this is a straightforward transaction; GFIS is a solid, high-quality business.” 

However, in a statement released yesterday on its web site, Genworth revealed that it sold GFIS to Cetera for $78.5 million, plus an earnout provision that could provide Genworth with "additional future compensation based on achieving certain revenue goals over a one-year period." Proceeds from the transaction, Genworth said, will be used for general corporate purposes, and said the sale will allow it focus on its core turnkey asset management businesses within Genworth Financial Wealth Management (GFWM).

GFIS, whose reps tend to be tax and accounting professionals who also provide investment advice to clients, will become the fourth broker-dealer for Cetera, the former ING Advisors IBD network that was acquired in February 2010 by Lightyear, a private equity firm headed by former Paine Webber and UBS America executive Donald Marron.

The other BDs in the Cetera network are Financial Network Investment Corp., which  has about 1,800, mostly smaller reps; Multi-Financial Securities Corp., which has 1,000 reps; and PrimeVest Financial Services, a self-clearing BD that focuses on serving more than 600 financial institutions. 

In the interview, Brown pointed out that Cetera was acquiring both the GFIS broker-dealer and its RIA, and that the acquisition benefited Cetera and GFIS in terms of scale. Saying Cetera was well capitalized, and noting that they shared the same clearing firm, Pershing, she said, “We wanted a partner that allows us to cement our commitment to serve the multiple faces of independence. Tax and accounting professionals are extremely well positioned” in this challenging marketplace, boasting both deep knowledge of financial services and the trust of their clients. She noted as well that Cetera and GFIS share a commitment to the fee-based side of the BD business. 

Vasquez echoed that commitment, saying that GFIS’ 1,800 reps had $13 billion in assets, of which $4 billion was on its fee-based platform. He praised Brown for her knowledge and leadership, and said the partnership “will provide us with the scale to grow and continue to grow” particularly in the large but “fragmented” tax and accounting market.

“Our advisors are not your typical salespeople,” he said. From a platform perspective, he continued, “as we look to grow with more sophisticated advisors, the platform will help.”  The company will continue to be based in Schaumburg, Ill., and will continue, said Vasquez, “to maintain a strong relationship with Genworth Financial Wealth Management and offer their competitive suite of insurance and wealth management products.” Genworth is already a major supplier to Cetera’s existing BDs for those same products.

In an interview with AdvisorOne almost a year ago, Brown suggested that there would be further consolidation in the independent BD space, due to rising costs from compliance and technology investments and shrinking margins.

Brown said that Cetera was “committed to the continued success” of its existing broker-dealers’ reps, and noted that “many of our leaders are very much involved in the industry, with FSI, SIFMA and IRI,” which was one reason why Cetera recently announced it would subsidize all 3,500 of its reps’ membership in FSI.

Thursday, March 15, 2012

5 Tips on how to start Trading in Stocks

Stage One: Discover around you are able to about trading. Study as numerous textbooks about investing as attainable. Develop your personal possibilities on which you may use. Discover about decreased income analysis. Discover to make implications about administration and industries from public information and facts. Suggested reading by means of: – Security Analysis by Benjamin Graham and David – Trading: era x by David – The Aggressive Conservative Investor by Marty Whitman – by Mary

Phase Two: Know what your investment strategy and time horizon are: Determine which kind of technique or approaches you believe you is heading to complete properly with and hence are self-confident with. The shorter your time and work the much less aggressive your technique ought to be. You may prefer to start with multiple procedures. Widespread strategy styles are ‘Safe and Cheap’, ‘Growth in a affordable expense and ‘High dividend yield’, ‘Cash Cows’, ‘Profitable, but unloved’, ‘Blue Chips’, ‘Low listed growth stock, “Insider interest’ etc. Styles like ‘hot stocks’, ‘explosive penny stocks’ etc. are extremely erratic. You’ll want to arranged your portfolio’s parameters: – What size your portfolio is heading to become – Which sort of stocks you will acquire (industry, market, industry cap, etc.) – The number of stocks are you currently going to very own – What could make you purchase a standard – What could make you offer a normal

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Step Four: Study from your errors: Each time you decide on a typical make notes about the cause why you selected that stock. Return and get a appear at picks and notes periodically. Will be the next action better with industries or firms you recognize nicely? Would you market as well soon once the marketplace is volatile? Queries for instance these trigger you to understand how you reply to particular problems and will enable you to acknowledge biases that harm your revenue. Creating a mock portfolio, on web sites like can allow you to understand without jeopardizing actual cash.

Move Five: Select a stockbroker: Investigation stock broking companies. Just take a look at commissions, execution services ranges, usage of research, premiums of fascination along with other features. Well-liked brokers are E-trade, Trade and Fidelity. Now you are ready to as being a greater investor than most!

Find out extra information about scotts trade with my top recommended scotts trade blog.

SLAB Off Despite Q4 Beat; Piper Ups Target to $54

Shares of chip maker Silicon Labs (SLAB) are down 16 cents, or 0.3%, at $46.91 despite the company this morning reporting Q4 revenue and profit per share ahead of analysts’ expectations, and projecting Q1 revenue higher as well.

Revenue in the three months ended in December rose 13%, year over year, to $126.7 million, yielding EPS of 49 cents, excluding some costs.

Analysts had been modeling $119.8 million and 43 cents.

For the current quarter, the company sees revenue in a range of $120 million to $125 million, above the average $117.9 million estimate.

CEO Necip Sayiner said the company had a “sustained improvement in the strength of bookings as we ended 2011,” and that the company is gaining share with its chips.

Update: Piper Jaffray’s Gus Richard reiterated an Overweight rating and raised his price target to $54 from $47, writing that the quarter was “solid,” the forecast “strong.”

The company is “gaining traction” for its “TV tuner” chip and its touch-screen controller for smartphones, he observes, and some weaker products, such as a tuner for FM radio, is in decline, serving as less of a drag on results.

Richard thinks the company will have above-average growth as a result of “unique mixed signal anything-in-CMOS capability.”

Taseko Mines Goes Red

Taseko Mines (AMEX: TGB  ) reported earnings on March 13. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Taseko Mines whiffed on revenues and missed expectations on earnings per share.

Compared to the prior-year quarter, revenue contracted significantly and GAAP earnings per share dropped to a loss.

Margins contracted across the board.

Revenue details
Taseko Mines booked revenue of $59.5 million. The one analyst polled by S&P Capital IQ wanted to see revenue of $85.9 million on the same basis. GAAP reported sales were 46% lower than the prior-year quarter's $109.6 million.


Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at -$0.04. The one earnings estimate compiled by S&P Capital IQ predicted $0.01 per share. GAAP EPS were -$0.04 for Q4 versus $0.11 per share for the prior-year quarter.


Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 31.9%, 2,510 basis points worse than the prior-year quarter. Operating margin was -27.9%, 6,720 basis points worse than the prior-year quarter. Net margin was -12.7%, 3,590 basis points worse than the prior-year quarter.

Looking ahead
On the bottom line, the average EPS estimate is $0.09.

Next year's average estimate for revenue is $322.0 million. The average EPS estimate is $0.36.

Investor sentiment
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 1,893 members out of 1,933 rating the stock outperform, and 40 members rating it underperform. Among 322 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 313 give Taseko Mines a green thumbs-up, and nine give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Taseko Mines is outperform, with an average price target of $10.64.

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Best Wall St. Stocks Today: V,MA,DFS,AXP

Americans are still shrinking their credit according to the latest data from the Federal Reserve.� July marked a sixth consecutive drop and the seasonally adjusted rate of credit contraction came to down 1.8%.� Overall, this came to $3.6 billion less to $2.42 trillion in July.� We had two figures seen ahead of this number: -$3.5 billion from Bloomberg and -$5 billion from Dow Jones.

Revolving credit fell by more than 6% or by $4.4 billion to $827.8 billion.� While all act differently, today’s news has at least some continuing implications for Visa, Inc.� (NYSE: V), MasterCard Incorporated (NYSE: MA), Discover Financial Services (NYSE: DFS) and American Express Company (NYSE: AXP).

There was a slight gain to non-revolving credit that showed a 0.6% rise for those categories like cars, school loans, vacations, and one-time purchases.

The report here is a bit muted because this trend in revolving credit is lower almost monthly.� Another muting figure is that the June report showed that the drop was roughly $1 billion rather than $1.3 billion previously reported.

This trend is coinciding with a drop in delinquencies and in charge-offs by credit card companies.� With no real job growth and with many of the current and forecasts expected to remain subdued, looking for any real credit increase might not be in the cards.

Visa, Inc.� (NYSE: V) and MasterCard Incorporated (NYSE: MA) both took a hit today, although the damage on them was done earlier than the 3PM report from the Federal Reserve.� Bank of America Merrill Lynch cut its� “Neutral” rating on Visa down to an even worse “Underperform” rating.� That just matched its prior call on MasterCard.� Visa was down 4.1% at $68.55 and MasterCard was down 3% at $194.40 on the day.� BofA’s downgrade was tied not so much to credit balances but over doubts of pricing power and credit card processing fee regulatory concerns.

Card issuers Discover Financial Services (NYSE: DFS) and American Express! Company (NYSE: AXP) did not share the same fate for the most part.� AmEx was slightly lower by only $0.02 at $40.07 after an already large debt offering group was made even larger to $2 billion of all the debt sold Wednesday and Discover was actually up 2% to $15.62 on the day.

This is a fair question to ask… Have you de-leveraged your financial life yet?


Business intelligence advisors

Network Marketing

Multilevel marketing is an effective online marketing strategy where product sales workers are taken care of sales but for the sales associated with workers these people recruit. The process creates an impact where more mature workers obtain more than more recent workers. If you’d like to put into action a network marketing technique for your business, try this advice.

Provide related information to folks who will be watching your site, and to your personal niche. Discover what the people you need to attract are trying to find online, after which provide which content. You should check social media websites and discussion boards as they’re an excellent repository of knowledge.

As a network marketer working as a recruiter, you will have to show and prove the financial capabilities of what you’re doing. People cannot feel as if they’re being used to pad your personal bank account. Show them examples of people who’ve made money and how they can follow that path.

Always remember in order to posture your self correctly within conversations as well as business transactions. You are the professional and experienced business owner. Inside your network marketing business are not equipped off because weak for your prospects, rather present yourself because knowledgeable, companion, and an professional at your work even if you do not. This helps develop trust in not just your business, however, you.

You should always use a set timetable and adhere to it. You should dedicate at least A dozen hours regarding actual try to your business because of it to become productive. Plan for what you really are going to use the time you’ve got set aside to your business, you should always be on timetable. If you follow a schedule your small business will work better.

Do not compare you to ultimately others within network marketing companies. Your business is not the same as any other people. Comparing you to ultimately top earners is onl! y going to make you feel frustrated. You are likely promoting a different item to a different marketplace, or you happen to be selling for any different period of time. Your business may grow with time; you have to allow it to.

When making an mlm presentation to some group, talk to each fellow member. Lock eye individually while you speak because that will provide the lead you are looking at the sensation that you’re becoming honest as well as speaking straight to them. This can endear them to you and also take them from the lead to a transformation.

If you are with your friends or family to increase your system and sell your product or service, do not take benefit of them monetarily. Team members ought to be compensated pretty to avoid any kind of disturbances inside your circle. Using a bad status with one individual ruins an additional circle associated with friends and family that may have been customers of your item.

Never apply your own benefits to your network marketing sales pitch! You want to sell the lead something THEY want, not what you desire as it’s very possible they don’t want what you want. If you had kids and they don’t then not having to pay day care won’t be a benefit they care about.

There’s more that goes into gaining confidence than just reading some good information, however. Confidence requires that you have faith in what you’re doing and realize that your business will be successful. The tips you just read here can help you gain that confidence by exposing some solid, working marketing methods.

John has over 40 years of experience in business promoting sales engineering general management online real-estate planning, for the past 20 years John has been a active Meditation Student. He has worked for and with worldwide corporations such as IBM, Electronic Data Systems and Mahindra British Telecomm. He has a BS from Brown in Computer Science an MA through IBM in Industrial Electronics, he also has a PhD in Internationa! l Trade and Management from the London School of Business and Trade

Wednesday, March 14, 2012

Baird Adds $350 Mil Team; 4 FAs Join from Morgan Stanley

Baird says that is just added four financial advisors and opened the firm's first wealth management office in Charlotte, N.C.

The Parrott, Forbes & Floyd Group, formerly with Morgan Stanley Smith Barney, "brings 100 years of combined industry experience to Baird and collectively oversees more than $350 million in client assets," the company said in a press release.

The team joining Baird includes Michael C. Parrott, CIMA; Charles S. Forbes, CIMA, CRPS; Trea Floyd, CFP; and James Bunting.

The office also includes branch manager Landrum Henderson, who joined the company in October 2009 from Bank of America."I couldn't be more pleased to welcome Mike,

Chuck, Trea, Jim, Linda and Kristy to Baird," Henderson said in a statement. "Widely recognized as a well established and highly respected team, they will be instrumental in establishing a wealth management presence for Baird in Charlotte."

Baird's Charlotte office is currently located at 5605 Carnegie Blvd., but will relocate permanently to the Piedmont Row complex later this year.

The firm's private wealth management business continues to grow, having added more than 100 FAs in 2009 and 30 advisors and branch managers since the beginning of 2010 - the vast majority from the four wirehouses.

Baird now includes more than 650 financial advisors, who oversaw more than $58 billion in client assets as of March 31, 2010.

Couch surfing: a guide

Visiting other cities, whether for work or play can be somewhat daunting. You can feel like a complete outsider when you have to leave the local parts of a city in order to sleep in an impersonal hotel. There is a way of undermining this, however, which is called couch surfing, and it’s where strangers meet online and arrange for each other to sleep on their respective couches, or stay in their space rooms. What follows is a brief look at what couch surfing is, and why anyone would want to do it.

The idea is that, people who want a cheaper or more homely accommodation while travelling join a couch surfing online community. That way they can arrange to stay on someone’s couch, or their spare room, in whichever place they want to visit. But they can’t just do this without offering something in return. The deal is, the person whose couch you stay on, is free to come and stay on your couch, too. But why would anyone want to do this?

The benefits are plenty. First of all, it is cheaper. The only thing you offer in return is your own hospitality, meaning you don’t spend a cent on accommodation while you are staying at your couch surfing partner’s house. Also, you have access to local resources, such as internet connection and telephones, which I’m sure your host will not mind you using. This is a much more homely way to stay in a foreign place.

Those people whose couch you are staying on are likely to know a lot more about the local area than a guide book or a hotel assistant. For a start, there is no vested interest in you going anywhere, or buying anything, so you’ll get an honest and reliable opinion about where to go and what to do. They can help you have a good time, without getting ripped off.

The benefit of making friends in other cities is another benefit. If you and your host really get on, then you may end up with a friend in a nice place that you can come and visit on future occasions. Couch surfing is a sociable, cheap and fun way! of doin g accommodation.

For cheap holidays to Ibiza, look no further.

MTS Systems Outruns Estimates Again

MTS Systems (Nasdaq: MTSC  ) reported earnings on Feb. 2. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Dec. 31 (Q1), MTS Systems beat expectations on revenues and beat expectations on earnings per share.

Compared to the prior-year quarter, revenue expanded significantly and GAAP earnings per share increased.

Gross margins dropped, operating margins grew, net margins dropped.

Revenue details
MTS Systems booked revenue of $133.7 million. The three analysts polled by S&P Capital IQ hoped for sales of $124.0 million. Sales were 26% higher than the prior-year quarter's $105.9 million.


Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions.

EPS details
EPS came in at $0.98. The two earnings estimates compiled by S&P Capital IQ anticipated $0.80 per share. GAAP EPS of $0.98 for Q1 were 14% higher than the prior-year quarter's $0.86 per share.


Source: S&P Capital IQ. Quarterly periods. Figures may be non-GAAP to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 43.9%, 20 basis points worse than the prior-year quarter. Operating margin was 17.6%, 20 basis points better than the prior-year quarter. Net margin was 11.6%, 100 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $124.1 million. On the bottom line, the average EPS estimate is $0.83.

Next year's average estimate for revenue is $516.7 million. The average EPS estimate is $3.67.

In vestor sentiment
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 73 members out of 80 rating the stock outperform, and seven members rating it underperform. Among 33 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 32 give MTS Systems a green thumbs-up, and one give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on MTS Systems is outperform, with an average price target of $53.33.

Over the decades, small-cap stocks, like MTS Systems have provided market-beating returns, provided they're value priced and have solid businesses. Read about a pair of companies with a lock on their markets in "Too Small to Fail: Two Small Caps the Government Won't Let Go Broke." Click here for instant access to this free report.

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Business Formation Benefits

There are several ways to structure a small business and each has benefits and drawbacks. Often, people will not engage in any legal formation, running their businesses as sole proprietorships. The benefit here is only in the ability to forgo formation fees, which is a small price to pay for the protections that come with the formation of a limited liability company (LLC) or S corporation. The benefit of these entities is that they shield the owners from certain liabilities, as well as provide tax incentives in many cases. Experts advise anyone running a small business to form a structure of some kind, if only to avoid personal liability when it comes to providing their products or services. For more on this continue reading the following article from JDSupra.

Every now and then a new client comes in who has started a business, but has not incorporated or formed a limited liability company. Sometimes he or she has been operating the business for a while without any such structure. Doing so is foolish.

Almost everyone obtains liability insurance. However, that insurance does not cover all perils. Some business owners also obtain insurance against business interruptions due to perils such as fire, water damage or utility failures. In some businesses errors and omissions (“E&O”) coverage and fidelity insurance (against employee theft or other wrongdoing) is useful. It is important to know what the insurance covers – and doesn’t cover. That is a subject between you and your insurance agent.

This article concerns common forms of doing business, their differences, and what is usually the wisest route.
The simplest form is a sole proprietorship – someone doing business in his or her own name. Although it has the advantages of no formalities and l! ower fee s, the disadvantage outweighs them: unlimited individual liability for all obligations of the business. Even if the sole proprietor is well-insured, he or she can not escape liability for debts of the business that are not covered by insurance, such as debts to creditors.

Often a sole proprietor will file with the county clerk a certificate of assumed name, also known as a “DBA (doing business as) certificate”. However, such a filing does not protect against liability.

A general partnership is an association of two or more persons to conduct a business as co-owners. Each partner has unlimited personal liability, just like with a sole proprietorship. To make matters worse, each partner is an agent for the others and for the partnership business. A partner may find himself or herself liable for something another partner did. A partnership is legally dissolved upon the death, bankruptcy or withdrawal of any partner. This type of arrangement rarely should be used. If it is, a detailed written agreement is essential.

For the vast majority of small businesses, the preferred form is either an S corporation or a limited liability company. In both cases, owners typically are not personally liable for debts of the entity. There are certain important exceptions, such as for employee wage claims and withholding, social security and sales taxes, which are considered to be obligations held in trust.

As in a sole proprietorship and a partnership, income to members of a limited liability company is taxed directly to them. No separate income tax is paid by the entity. Likewise, if certain tax elections are filed on behalf of a corporation shortly after it is formed choosing to be treated as an S corporation, the income of the corporation will not be separately taxed; only the compensation paid to employees and owners will be taxed.

Both a corporation and a limited liability company can have as little as one owner. An S corporation can not have more than 75 owners, and they each must be an individual, a decedent’s estate or a certain type of trust. There also must only be one class of stock, which means that profit must be divided in accordance with the percentage of ownership.

A limited liability company does not have such restrictions. However, in most cases these restrictions are not a concern, and the S corporation usually is chosen. The cost of creating the entity is not expensive. A limited liability company costs several hundred dollars more, mostly because of the requirement of publication of “the birth” in newspapers.

This is not meant to be a thorough explanation of business forms. For example, two or more persons or entities also may form a limited partnership. In this entity, there are one or more general partners, with unlimited liability for the debts of the business and general powers of management, and one or more limited partners, with no personal liability for debts of the business and no management power. Professionals may incorporate as a professional corporation or a limited liability partnership, with similar results, except each professional still is personally liable for his or her own negligence or misconduct and that of any person under his or her direct supervision and control.

Tax consequences of each form of ownership must be discussed with a tax expert. In all cases, a written agreement among the owners is important. It should cover items such as duties of each person involved, their compensation and their rights regarding sale or other transfer of their ownership interests. It also should provide rules in the event of death or disability of an owner, and in the event that one decides to sell or cease doing business. Although the cost of cr! eating s uch an agreement is additional to the cost of legally forming the entity, it is money well spent. If a dispute arises between co-owners who have no such agreement, invariably, resolution of the dispute is more expensive. The result also might not be what they expected. With thanks to Ben Franklin, “An ounce of prevention is worth a pound of cure.”

General Electric: 5 Reasons to Buy, Says Bernstein

General Electric (GE) shares have dipped since Bernstein Research analyst Steven Winoker downgraded them in January, even though the biggest threat — an expensive industrial acquisition — never materialized. Now Winoker sees plenty of upside for the stock, and thinks shares could climb to $21 from $16.37 at yesterday’s close.

Winoker sees five potential catalysts:

  1. More dividend raises, pushing the yield above 4%.
  2. The resumption of a dividend paid by GE Capital to the larger corporation upon Fed approval.
  3. free cash flow growing 10% per year to more than $11 or $12 billion, offsetting pension costs.
  4. Rising gas turbine orders anticipated in mid-2012 helping pricing and margins in energy.
  5. good upside/downside valuation. “To the downside, we assume our severe recessionary scenario EPS which is ~25% below our base case, as well as multiple contraction and that would result in ~$13-14 per share. On the current stock price of $16, this suggests ~2:1 upside/downside.

GE shares rose 2.9% to $16.80 in afternoon trading.

Tuesday, March 13, 2012

Investors Turn to TIPS as Warren Buffett Warns on Inflation

Warren Buffett last week did more than warn investors on the dangers of low interest rates and inflation.

The Oracle of Omaha also had harsh words for traditional bonds.

In a Fortune article Buffett went so far as to say, "Right now bonds should come with a warning label."

"They are among the most dangerous of assets," Buffett wrote, "Over the past century these instruments have destroyed the purchasing power of investors in many countries."

To prove his point Buffett labeled inflation as the primary threat to bond investors, noting it takes no less than $7 today to buy what $1 did in 1965.

Instead of bonds, Buffett recommends "productive assets," including farmland and real estate.

But he saved his highest praise for stocks, especially the stocks of companies like The Coca-Cola Co. (NYSE: KO) and International Business Machines Corp. (NYSE: IBM), that consistently deliver inflation-beating returns.

But what if you're not comfortable betting most or all of your chips on stocks? And if traditional bonds are out, where else can investors turn for inflation beating returns?

TIPS Insure Wealth Against Inflation

Enter Treasury Inflation Protected Securities, or TIPS.

Unlike regular bonds, TIPS are designed to protect your principal against the ravages of inflation.

In fact, TIPS zig when other securities zag, providing diversification and safety to your portfolio.

TIPS are considered to be an extremely low-risk investment since they are backed by the U.S. government, and their par value rises with inflation while their interest rate remains fixed.

Here's how they work.
Like conventional bonds, TIPS pay interest twice a year at a fixed rate. But the principal of a TIPS bond is periodically adjusted to offset any i! ncrease in inflation as measured by the Consumer Price Index (CPI).

When a TIP matures, you are paid the adjusted principal or original principal, whichever is greater.

Investors should note the principal will also adjust to fall with deflation and the interest is subject to federal income tax, but exempt from state and local income taxes.

There are two main benefits of TIPS.

The first is that they're essentially Treasury bonds indexed to inflation. That eliminates one of the key risks for bond investors - rising interest rates. By buying TIPS you're essentially betting on higher interest rates and inflation.

And with governments around the world unleashing untold amounts of fiscal stimulus, there are plenty of investors who are buying TIPS to get insurance against an inflationary cycle.

Second, debt sold by the Treasury Department is guaranteed by the full faith and credit of the federal government. It's fairly inconceivable that the folks who actually print the money will default on their debt.

And if you hold TIPS to maturity you know exactly what you are going to get: all of your money back, with interest, and with both principal and interest adjusted for inflation.

How to Invest in Treasury Inflation Protected Securities

TIPS are also easy to buy.

You can buy new-issue TIPS directly from the TreasuryDirect system in 5-, 10-, and 20-year maturities. Or you can get them from a broker, an exchange traded fund (ETF) or a mutual fund. More than 20 fund companies offer TIPS funds.

Most analysts say TIPS are appropriate for most investors.

"TIPS should be part of every fixed-income portfolio," Donald Ellenberger, a government bond manager at Federated Investors Inc. told Business Week.

So how do you know what to buy?

If you're extremely concerned about a near term spike in inflation you! might c onsider buying a short term TIPS or the PIMCO 1-5 Year U.S. TIPS Index (NYSE: STPZ).

The yield is extremely low but it is almost a pure play on inflation. They are also less risky than longer term TIPS. The ETF returned 6% over the last 12 months.

The sweet spot in terms of risk and return on TIPS is probably around five years. Buy-and-hold investors should do well by purchasing TIPS in those maturities or the iShares Barclays TIPS Bond ETF (AMEX: TIP). The fund returned 13.38% in 2011.

A long-term buy-and-hold investor could purchase 20-year TIPS or the PIMCO 15+ Year US TIPS Index ETF (AMEX: LTPZ). The ETF returned 25.32% in 2011, slightly below the return on long-term Treasuries.

You might want to consider owning all three.

By laddering a mix of ETFs with variable maturities, an investor could both diversify and restock his portfolio with a reasonable alternative to bonds.

After all, Warren Buffett is right about inflation. That makes TIPS a great hedge against the power of the printing press.

News & Related Story Links:

  • Money Morning:
    Not Much of a Debate: Inflation is Part of the Plan
  • Money Morning:
    How to Win Bernanke's War on Savers with a 19% Yield
  • Money Morning:
    Why I'm Taking Gold Double-Eagles on My Next Trip to Utah
  • Fortune:
    Warren Buffett: Why stocks beat gold and bonds

Great Energy Stocks To Own For 2014

I was a bit surprised when I took a look at the best performing ETF’s in 2014, especially when I saw that coal related stocks had done so well. There is so much discussion about the older energy sources such as coal, oil and natural gas that have been moving our economy for decades. Climate change discussions as well as rising commodity prices have helped bring alternative or renewable energy discussions to the front table.

The problem of course is that these new energy sources are often much more expensive and while that may change in the future, it is not clear how much time it will take. It seems like I have been reading about electric or hydrogen cars for over a decade and yet there is no sign of when a gasoline free car will be mass produced.

However, I don’t think anyone could argue that there will be some big winners in the alternative energy field. Just imagine the company that can produce that first battery or solar car?? There will be some big winners in this field, just as there were in the early days of pc’s or of the internet. But finding the right one is the tricky part.

The million dollar question is also how much time it will take to get alternative energy in the driver’s seat. Could coal and oil be at the top of the 2014 best performing stocks? It could happen. In the end, I decided not to use any energy picks in my top stock picks for 2014 but I do still believe there is money to be made. By far, the biggest alternative energy category is solar energy.

Great Energy Stocks To Own For 2014:Global Industries Ltd. (GLBL)

 Global Industries, Ltd., together with its subsidiaries, provides construction and subsea services to the offshore oil and gas industry in the North America, Latin America, and the Asia Pacific/the Middle East regions. The company?s services include pipeline construction, platform installation and removal, construction support, diving services, diverless intervention, and marine support services. As of December 31, 2010, its fleet included four derrick lay barges, one pipelay/derrick vessel, one heavy lift ship, one pipelay barge, four multi-service vessels, one dive support vessel, and one offshore supply vessel. The company serves oil and gas producers and pipeline companies. The company was founded in 1973 and is headquartered in Carlyss, Louisiana.

Great Energy Stocks To Own For 2014:Transportadora De Gas Sa Ord B (TGS)

 Transportadora de Gas Del Sur S.A. engages in the transportation of natural gas, as well as production and commercialization of natural gas liquids primarily in Argentina. It operates approximately 8627 km long pipeline system. The company transports its natural gas to distribution companies, industries, traders, producers, and power plant operators. The company?s production and commercialization activities are conducted at the Cerri Complex located near Bahia Blanca. Its natural gas liquid products comprise ethane, propane, butane, and natural gasoline. It also provides midstream services, which consist of gas treatment, gas compression, and wellhead gas gathering services; removal services for impurities from the natural gas stream; and pipeline construction, operation, and maintenance services. In addition, the company offers telecommunication services for telephone operators and other corporate users. Its telecommunication network includes a microwave's digital system with synchronous digital hierarchy technology. The company was founded in 1992 and is based in Buenos Aires, Argentina. Transportadora de Gas Del Sur S.A. is a subsidiary of Compania de Inversiones de Energia S.A.

Great Energy Stocks To Own For 2014:Kayne Anderson Energy Development Company (KED)

 Kayne Anderson Energy Development Company is a principal investment firm specializing in energy investments. The firm prefers to invest in midstream energy companies. It seeks to invest between $10 million and $75 million. The firm typically invests in non-traded companies through equity and debt instruments. Kayne Anderson Energy Development Company is based in Houston, Texas.

Great Energy Stocks To Own For 2014:Linn Energy LLC (LINE)

 Linn Energy, LLC, an independent oil and natural gas company, engages in the development and acquisition of oil and gas properties in the United States. The company holds interests in various properties located in Oklahoma, Kansas, Louisiana, Illinois, Michigan, and California, as well as located in the Permian Basin in west Texas and southeast New Mexico. As of December 31, 2010, it had proved reserves of 2,597 billion cubic feet equivalent of oil and gas, and natural gas liquids, as well as operated 7,097 gross productive wells. The company was founded in 2003 and is headquartered in Houston, Texas.

Great Energy Stocks To Own For 2014:Delta Natural Gas Company Inc. (DGAS)

 Delta Natural Gas Company, Inc. distributes or transports natural gas in central and southeastern Kentucky. It operates through two segments, Regulated and Non-Regulated. The Regulated segment sells and distributes natural gas to its retail customers primarily in 23 rural counties. This segment also transports gas to industrial customers on its system who purchase gas in the open market, as well as transports gas on behalf of local producers and other customers not on its distribution system. The Non-Regulated segment purchases natural gas in the open market, primarily from Kentucky producers, and resells this gas to industrial customers on its distribution system and to others not on its system. This segment also produces natural gas that is sold to Delgasco for resale in the open market. The company owns approximately 2,500 miles of natural gas gathering, transmission, distribution, storage, and service lines; and holds leases for the storage of natural gas under 8,000 acres located in Bell County, Kentucky. It serves approximately 37,000 customers. The company was founded in 1949 and is headquartered in Winchester, Kentucky.

Great Energy Stocks To Own For 2014:Niska Gas Storage Partners LLC (NKA)

 Niska Gas Storage Partners LLC owns and operates natural gas storage assets in North America. It owns or contracts for approximately 185.5 billion cubic feet of total gas storage capacity. The company owns and operates gas storage facilities in Alberta, Canada, as well as in northern California and Oklahoma, the United States. Its gas storage customers include financial institutions, producers, marketers, power generators, pipelines, and municipalities. The company was founded in 2006 and is headquartered in Houston, Texas.

Great Energy Stocks To Own For 2014:Occidental Petroleum Corporation (OXY)

 Occidental Petroleum Corporation, together with its subsidiaries, operates as an oil and gas exploration and production company primarily in the United States. The company operates in three segments: Oil and Gas; Chemical; and Midstream, Marketing, and Other. The Oil and Gas segment explores for, develops, produces, and markets crude oil, natural gas liquids, and condensate and natural gas. Its domestic oil and gas operations are located in Texas, New Mexico, California, Kansas, Oklahoma, Utah, Colorado, North Dakota, and West Virginia; and international oil and gas operations are located in Bahrain, Bolivia, Colombia, Iraq, Libya, Oman, Qatar, the United Arab Emirates, and Yemen. As of December 31, 2010, this segment had proved reserves of approximately 3,363 million barrels of oil equivalent. The Chemical segment manufactures and markets basic chemicals, including chlorine, caustic soda, chlorinated organics, potassium chemicals, and ethylene dichloride products; vinyls, such as vinyl chloride monomer and polyvinyl chloride; and other chemicals comprising chlorinated isocyanurates, resorcinol, sodium silicates, and calcium chloride products. The Midstream, Marketing, and Other segment gathers, treats, processes, transports, stores, purchases, and markets crude oil that includes natural gas liquids and condensate, as well as natural gas and carbon dioxide. This segment also involves in the power generation; and trades around its assets comprising pipelines and storage capacity, as well as oil and gas, other commodities, and commodity-related securities. Occidental Petroleum Corporation was founded in 1920 and is based in Los Angeles, California.

Advisors' Opinion:

  • By Paul At 2011-10-6

    Occidental Petroleum (OXY-N75.722.463.36%) is an integrated oil-and-gas company, with operations in the U.S.

    The Los Angeles-based company has strong operating momentum, having grown 12-month sales 27 per cent and net income 76 per cent. Its stock has been a top performer over a three-year span, having gained 12 per cent a year, on average. Occidental has a market capitalization of $78-billion. It receives positive rankings from 84 per cent of researchers. It is scheduled to report fourth-quarter results on Jan. 26. Analysts forecast a 17 per cent year-over-year rise in adjusted earnings and a 7.6 per cent gain in sales. Occidental has an average earnings surprise rate of 6.6 per cent. It beat the consensus expectation by 8.2 per cent last quarter.

    Like Chevron and El Paso, what is most attractive about Occidental is its relative value amid strong secular growth. Its stock sells for a forward earnings multiple of 13 and a book value multiple of 2.5, 28 per cent and 43 per cent peer discounts. Its PEG ratio, the stock's P/E divided by researcher's long-term growth forecast, of 0.3 represents a 70 per cent discount to estimated fair value, a compelling bargain. Occidental pays a quarterly dividend of 38 cents, converting to an annual yield of 1.6 per cent. It has grown the payout 16 per cent and 18 per cent annually, on average, respectively, over three- and five-year spans. JPMorgan, optimistic about Occidental's long-term trajectory, is skeptical of the recent rally.

    Bullish Scenario: Goldman Sachs has a target of $111, suggesting a 13 per cent advance.

    Bearish Scenario: JPMorgan has a target of $90, implying that the stock will drop 8 per cent.