Tags |
|
|
Links |
|
|
Actual for You - Commodities & Dollar Cost Averaging a Simple Path to Double Digit Returns
Index TrackersThere is a category of unit trusts called index trackers, which are set up to match as far as possible a specific index, such as the FTSE 100, the FTSE all share, the US, Europe or Japan indices.Perfect linking cannot normally be achieved because no fund can invest in every share in the right proportions. Also indices take no account of the cost of buying and selling, which will depress the value of the tracker compared to the index.Charges are lower than ordinary unit trusts because expert advisers are not needed. Initial charges are usually no more than 1%.Some investment trusts offer index loan stocks, which are directly linked to the r
The gold stocks as represented by the GDM returned 40.2% vs. 2.1% for the S&P 500. To further round out the story, large cap stocks averaged 11.7% annual versus -7.1% for gold from 1981-2000. For the average investor, dollar cost averaging into the appropriate commodity or stock cycle is a no brainer strategy for double digit returns.
* CEF’s return is compounded monthly using equal monthly dollar investing. NEM, GDM and S&P 500 calculated using simple annual return.
References:
Analysis of Summers' paper: http://www.australiangold.org.au/docs/Gold_2002.pdf
Adam Hamilton – boom and bust cycle: http://www.zealllc.com/2005/longwave2.htm
Jim Rogers 6/5/2005 Barron’s “the current boom could last eight to 14 more years”: http://www.smartmoney.com/barrons/index.cfm?story=20060605
So often in the cleaning business chemicals are not stored properly and neither are the empty containers which conveniently leak, mix with rain water and tip over and soak into the ground surrounding the building and seep into the ground water causing environmental issues; you know like three legged frogs and such. Now mind you I am not an environmentalist, but I do know a thing or two about environmental pollution and lots about the cleaning industry and business, especially on the service sector side of things.You see for years I ran a mobile pressure washing business, which we built up and franchised into 23 states. One thing I would always do is scout out the competition to se
Former Treasury Secretary and current Harvard University President Lawrence Summers concluded in a 1988 published research piece that stocks and commodities are out of phase with each other (refer to link below). In one half of the cycle, stocks significantly outperform commodities and then in the second half of the cycle commodities outperforming stocks. This relationship continues to prove itself. Back in the late 90’s the fastest payback of capital was in internet infrastructure companies. Venture capital companies were crawling over each other to invest in the next Cisco. Meanwhile, commodity prices were at multi-decade lows with oil at $15 per barrel and gold at $250/oz. Mining companies were going out of business and projects were delayed due to the low prices and inadequate capital. Obviously the stock prices reflected the business cycle with technology stocks at all their all-time highs and commodity stocks at their lows. The internet frenzy concluded the stock cycle in 2000 and we are now 5 years in to the commodity cycle.
A simple investment strategy can be developed using the above information combined with the fact that bull markets tend to run on average17 years (Adam Hamilton/Jim Rogers links below). For example, the last two US-based bulls markets have been technology in 1982-2000 and commodities 1968-1982. The strategy is to simply dollar cost average into the broad market using an Exchange Traded Fund (ETF) like the SPY (an ETF tracking the S&P 500) during the stock phase of the cycle. Then one should switch to a vehicle such as Central Fund of Canada (CEF) during the commodity cycle.
"Central Fund invests in gold and silver bullion and does not speculate with regard to short-term changes in gold and silver prices. As of October 31, 2005, on a physical basis, 50 ounces of silver were held for each ounce of gold held. During such time, Central Fund's net assets at market value of approximately $541 million consisted of 53.9% gold bullion and certificates, 44.5% silver bullion and certificates, and 1.6% cash, marketable securities and other working capital amounts."Dollar cost averaging an equal dollar amount into CEF each month over the past five years would have returned the following:
Gold vs. S&P 500As you can see, gold has significantly outperformed stocks over the past five years (15.4% vs. 2.1% annual). Since we are in a commodity cycle, this is consistent with the stated research. The above example used CEF which is composed of gold and silver bullion. If we substitute an index of gold mining stocks - the out performance is more dramatic. GDX is an Exchange Traded Fund based on the AMEX Gold Miners Index (GDM). It just began trading on 5/25, so this comparison is simply theoretical. However, the index has been in existing for awhile. So, the comparison below is versus the index GDM. To make it more realistic I have also included data for Newmont Mining (NEM) currently the world’s second largest gold mining company.. CEF S&P 500
2005 38.1% 9.8%
2004 -6.2% 6.1%
2003 14.2% 34.0%
2002 21.8% -22.7%
2001 9.31% -16.6%
Avg.* 15.4% 2.1%
Gold/Gold Stocks vs. S&P 500The gold stocks as represented by the GDM returned 40.2% vs. 2.1% for the S&P 500. To further round out the story, large cap stocks averaged 11.7% annual versus -7.1% for gold from 1981-2000. For the average investor, dollar cost averaging into the appropriate commodity or stock cycle is a no brainer strategy for double digit returns.. CEF NEM GDM S&P 500 2005 38.1% 50.0% 67.1% 9.8% 2004 -6.2% 0.5% -4.1% 6.1% 2003 14.2% 44.5% 28.1% 34.0% 2002 21.8% 33.1% 57.5% -22.7% 2001 9.31% 42.2% 52.4% -16.6% Avg.* 15.4% 34.1% 40.2% 2.1%
* CEF’s return is compounded monthly using equal monthly dollar investing. NEM, GDM and S&P 500 calculated using simple annual return.
References:
Analysis of Summers' paper: http://www.australiangold.org.au/docs/Gold_2002.pdf
Adam Hamilton – boom and bust cycle: http://www.zealllc.com/2005/longwave2.htm
Jim Rogers 6/5/2005 Barron’s “the current boom could last eight to 14 more years”: http://www.smartmoney.com/barrons/index.cfm?story=20060605
Congratulations! You've just started a new business, you've signed on the dotted line, purchased your inventory or set up your website, opened your doors and now .... Yikes!! Depending on your new business start up costs, it could be quite a while before you see a profit. How do you get 'into the black' without burning yourself out?The key is to work smarter, not harder. Here are four key business strategies to help you maximize your profits during this critical phase, to help you bring income in quicker from your new business. Simplicity and Focus First. Do NOT over-diversify or overcomplicate your new business. This is a common mistake that business b
A simple investment strategy can be developed using the above information combined with the fact that bull markets tend to run on average17 years (Adam Hamilton/Jim Rogers links below). For example, the last two US-based bulls markets have been technology in 1982-2000 and commodities 1968-1982. The strategy is to simply dollar cost average into the broad market using an Exchange Traded Fund (ETF) like the SPY (an ETF tracking the S&P 500) during the stock phase of the cycle. Then one should switch to a vehicle such as Central Fund of Canada (CEF) during the commodity cycle.
"Central Fund invests in gold and silver bullion and does not speculate with regard to short-term changes in gold and silver prices. As of October 31, 2005, on a physical basis, 50 ounces of silver were held for each ounce of gold held. During such time, Central Fund's net assets at market value of approximately $541 million consisted of 53.9% gold bullion and certificates, 44.5% silver bullion and certificates, and 1.6% cash, marketable securities and other working capital amounts."Dollar cost averaging an equal dollar amount into CEF each month over the past five years would have returned the following:
Gold vs. S&P 500As you can see, gold has significantly outperformed stocks over the past five years (15.4% vs. 2.1% annual). Since we are in a commodity cycle, this is consistent with the stated research. The above example used CEF which is composed of gold and silver bullion. If we substitute an index of gold mining stocks - the out performance is more dramatic. GDX is an Exchange Traded Fund based on the AMEX Gold Miners Index (GDM). It just began trading on 5/25, so this comparison is simply theoretical. However, the index has been in existing for awhile. So, the comparison below is versus the index GDM. To make it more realistic I have also included data for Newmont Mining (NEM) currently the world’s second largest gold mining company.. CEF S&P 500
2005 38.1% 9.8%
2004 -6.2% 6.1%
2003 14.2% 34.0%
2002 21.8% -22.7%
2001 9.31% -16.6%
Avg.* 15.4% 2.1%
Gold/Gold Stocks vs. S&P 500The gold stocks as represented by the GDM returned 40.2% vs. 2.1% for the S&P 500. To further round out the story, large cap stocks averaged 11.7% annual versus -7.1% for gold from 1981-2000. For the average investor, dollar cost averaging into the appropriate commodity or stock cycle is a no brainer strategy for double digit returns.. CEF NEM GDM S&P 500 2005 38.1% 50.0% 67.1% 9.8% 2004 -6.2% 0.5% -4.1% 6.1% 2003 14.2% 44.5% 28.1% 34.0% 2002 21.8% 33.1% 57.5% -22.7% 2001 9.31% 42.2% 52.4% -16.6% Avg.* 15.4% 34.1% 40.2% 2.1%
* CEF’s return is compounded monthly using equal monthly dollar investing. NEM, GDM and S&P 500 calculated using simple annual return.
References:
Analysis of Summers' paper: http://www.australiangold.org.au/docs/Gold_2002.pdf
Adam Hamilton – boom and bust cycle: http://www.zealllc.com/2005/longwave2.htm
Jim Rogers 6/5/2005 Barron’s “the current boom could last eight to 14 more years”: http://www.smartmoney.com/barrons/index.cfm?story=20060605
What would be more difficult: to stop smoking in a smoker’s environment or to quit when everybody around you continues with their same habits? Is it more difficult to change (your behaviour) in a new situation or in the old one? And why should you care?Most of the time the structure of an organization is changed prior to the introduction of new working methods. The idea is to do things differently ‘from now on’. The alteration of the structure is an important event that inducts new behaviour. The new structure should support that activities will be organized in another way and that your behaviour is moved into a new direction. You are at a new desk, you have new people arou
"Central Fund invests in gold and silver bullion and does not speculate with regard to short-term changes in gold and silver prices. As of October 31, 2005, on a physical basis, 50 ounces of silver were held for each ounce of gold held. During such time, Central Fund's net assets at market value of approximately $541 million consisted of 53.9% gold bullion and certificates, 44.5% silver bullion and certificates, and 1.6% cash, marketable securities and other working capital amounts."Dollar cost averaging an equal dollar amount into CEF each month over the past five years would have returned the following:
Gold vs. S&P 500As you can see, gold has significantly outperformed stocks over the past five years (15.4% vs. 2.1% annual). Since we are in a commodity cycle, this is consistent with the stated research. The above example used CEF which is composed of gold and silver bullion. If we substitute an index of gold mining stocks - the out performance is more dramatic. GDX is an Exchange Traded Fund based on the AMEX Gold Miners Index (GDM). It just began trading on 5/25, so this comparison is simply theoretical. However, the index has been in existing for awhile. So, the comparison below is versus the index GDM. To make it more realistic I have also included data for Newmont Mining (NEM) currently the world’s second largest gold mining company.. CEF S&P 500
2005 38.1% 9.8%
2004 -6.2% 6.1%
2003 14.2% 34.0%
2002 21.8% -22.7%
2001 9.31% -16.6%
Avg.* 15.4% 2.1%
Gold/Gold Stocks vs. S&P 500The gold stocks as represented by the GDM returned 40.2% vs. 2.1% for the S&P 500. To further round out the story, large cap stocks averaged 11.7% annual versus -7.1% for gold from 1981-2000. For the average investor, dollar cost averaging into the appropriate commodity or stock cycle is a no brainer strategy for double digit returns.. CEF NEM GDM S&P 500 2005 38.1% 50.0% 67.1% 9.8% 2004 -6.2% 0.5% -4.1% 6.1% 2003 14.2% 44.5% 28.1% 34.0% 2002 21.8% 33.1% 57.5% -22.7% 2001 9.31% 42.2% 52.4% -16.6% Avg.* 15.4% 34.1% 40.2% 2.1%
* CEF’s return is compounded monthly using equal monthly dollar investing. NEM, GDM and S&P 500 calculated using simple annual return.
References:
Analysis of Summers' paper: http://www.australiangold.org.au/docs/Gold_2002.pdf
Adam Hamilton – boom and bust cycle: http://www.zealllc.com/2005/longwave2.htm
Jim Rogers 6/5/2005 Barron’s “the current boom could last eight to 14 more years”: http://www.smartmoney.com/barrons/index.cfm?story=20060605
What is outsourcing?Outsourcing the literal meaning is getting work done or buying services from an outside service provider rather than using own resources. Usually outsourcing is done when the company is running in low profits with lean worker and working environment and in some cases to get work done with less cost and high quality.Who are freelancers?Freelancers are those who work independently and with less pay or salary for any outsourcing companies. These freelancers are usually from small countries which has low value to there currency.Freelancing now a days is at its boom, why because people are coming forward to work independently and earn a substant
Avg.* 15.4% 2.1%
As you can see, gold has significantly outperformed stocks over the past five years (15.4% vs. 2.1% annual). Since we are in a commodity cycle, this is consistent with the stated research. The above example used CEF which is composed of gold and silver bullion. If we substitute an index of gold mining stocks - the out performance is more dramatic. GDX is an Exchange Traded Fund based on the AMEX Gold Miners Index (GDM). It just began trading on 5/25, so this comparison is simply theoretical. However, the index has been in existing for awhile. So, the comparison below is versus the index GDM. To make it more realistic I have also included data for Newmont Mining (NEM) currently the world’s second largest gold mining company.
Gold/Gold Stocks vs. S&P 500The gold stocks as represented by the GDM returned 40.2% vs. 2.1% for the S&P 500. To further round out the story, large cap stocks averaged 11.7% annual versus -7.1% for gold from 1981-2000. For the average investor, dollar cost averaging into the appropriate commodity or stock cycle is a no brainer strategy for double digit returns.. CEF NEM GDM S&P 500 2005 38.1% 50.0% 67.1% 9.8% 2004 -6.2% 0.5% -4.1% 6.1% 2003 14.2% 44.5% 28.1% 34.0% 2002 21.8% 33.1% 57.5% -22.7% 2001 9.31% 42.2% 52.4% -16.6% Avg.* 15.4% 34.1% 40.2% 2.1%
* CEF’s return is compounded monthly using equal monthly dollar investing. NEM, GDM and S&P 500 calculated using simple annual return.
References:
Analysis of Summers' paper: http://www.australiangold.org.au/docs/Gold_2002.pdf
Adam Hamilton – boom and bust cycle: http://www.zealllc.com/2005/longwave2.htm
Jim Rogers 6/5/2005 Barron’s “the current boom could last eight to 14 more years”: http://www.smartmoney.com/barrons/index.cfm?story=20060605
Search engine optimization or SEO, the very words are enough to make people run screaming from their desks! People are constantly searching for new tricks, shortcuts and quick fixes. When it comes down to it though, like in so many parts of our lives, consistency is key.When you first build your website, you are excited to get it up on the web. You are anticipating how to handle all the new business that will be generated by thousands and thousands of visitors. Cut to a few weeks later, and you realize that no one is finding you!Don't feel defeated by the lack of whirlwind success online. Surely, by the time you have learned enough about website design to get your site
The gold stocks as represented by the GDM returned 40.2% vs. 2.1% for the S&P 500. To further round out the story, large cap stocks averaged 11.7% annual versus -7.1% for gold from 1981-2000. For the average investor, dollar cost averaging into the appropriate commodity or stock cycle is a no brainer strategy for double digit returns.
* CEF’s return is compounded monthly using equal monthly dollar investing. NEM, GDM and S&P 500 calculated using simple annual return.
References:
Analysis of Summers' paper: http://www.australiangold.org.au/docs/Gold_2002.pdf
Adam Hamilton – boom and bust cycle: http://www.zealllc.com/2005/longwave2.htm
Jim Rogers 6/5/2005 Barron’s “the current boom could last eight to 14 more years”: http://www.smartmoney.com/barrons/index.cfm?story=20060605
Announcement of GDX: http://biz.yahoo.com/tm/060525/14353.html?.v=1
HTTP = HTML link (for blogs, profiles,phorums):
<a href="http://www.actual4u.com/article/102782/actual4u-Commodities--Dollar-Cost-Averaging-a-Simple-Path-to-Double-Digit-Returns.html">Commodities & Dollar Cost Averaging a Simple Path to Double Digit Returns</a>
BB link (for phorums):
[url=http://www.actual4u.com/article/102782/actual4u-Commodities--Dollar-Cost-Averaging-a-Simple-Path-to-Double-Digit-Returns.html]Commodities & Dollar Cost Averaging a Simple Path to Double Digit Returns[/url]
Related Articles:
Increase Product Awareness by Becoming an Expert
Bookmark it:
|