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December 11, 2018

What exactly is leasing? – A detailed information

lending carA recent article in a UK newspaper claimed 1.6 million Brits currently lease their car – but how many actually understand what they’re doing?

When I first leased a car, I had no idea how it worked. I assumed a lease was something you got on a retail building and not a car!

Don’t let the complexity scare you though. Leasing can be a practical and affordable form of car finance if you take the time to get to know how it works. In this blog, I’ll run you through what leasing is, how it works and a couple different forms of leasing finance.

What is a lease?

To understand the difference between leasing and buying, you need to have a look at what you’re actually paying for in a lease.

When you buy a car outright, your payment covers the full value that the vehicle is worth. Once you’ve paid the full price (either immediately or over time), you become the legal owner of the car.

With leasing, you essentially ‘rent’ a car for a given period of time and return it at the end of your contract. Unlike buying a car, you’re never the legal owner of the car, although you are usually its registered keeper.

Why lease? Because depreciation hurts

Leasing is an attractive option for a lot of people because it eliminates one of the major problems that comes with owning a car – the cost of depreciation (depreciation is how quickly a car loses value).

According to the AA, new cars can lose up to 10% of their value the moment you drive them off the forecourt. Worse, the worst of the bunch can lose up to 60% of their value in the first year of ownership!

With these motors, if you’re planning on selling your car after a few years, you’re in for a shock when you check what it’s worth.

Contract Hire

Contract hire (more commonly known as leasing) is an arrangement where someone ‘rents’ a new car for a set period of time from a dealer. During the contract, the individual pays just enough to pay off the car’s depreciation. (Plus a little profit for the dealer, of course.) At the end of the contract, the individual returns the car to the dealer and they both go their separate ways.

With leasing deals, you aren’t the legal owner of the car but you are the registered keeper. That means you have get the car regularly serviced and keep it in a good condition.

The best thing about leasing compared to other finance options is the monthly payments, which tend to be significantly lower. That’s because, as I already mentioned, you’re only paying off the depreciation. You can also trade your car in every few years for a brand new model!

Tom Butcher worked behind the scenes in print journalism for years until he discovered the wonders of the web. He writes for several publications, covering the finance, automotive and tech sectors. At the moment, he is helping LeaseFetcher teach the world about car leasing.

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November 18, 2018

A (blue)chip on your shoulder: Things to know about blue chip funds

fund investmentsUnderstanding the viability of bluechip funds can help you plan your investment and get a well-rounded portfolio.

It is a well-known fact that market-linked investments are subject to a certain degree of risk. However, certain equity funds offer higher growth prospects with the risk element evened out over the long term. One such fund is the Emerging blue chip fund, or blue chip funds in general.

What is a bluechip fund?

The term ‘bluechip’ comes from the game of poker, where the blue coloured chip is the most expensive or valuable of all. The same logic is applied to the bluechip fund – these are equity funds of large multinationals or companies with a long and well-established track record of high performance and market credibility. Companies offering blue chip funds are normally in the top 3 performance bracket in their sector or industry.

Given their reputation and economic standing, bluechip equity funds are those with a large market capitalisation, usually in crores of Rupees. They are normally listed on the stock exchange.

Investors earn via dividend payments from these funds. They are considered relatively ‘safe’ funds to invest in, with a higher propensity for stable and regular growth.

However…

  • These equity funds offer dividend payouts since their prices normally do not move much. The dividends can become a valuable second income for investors.
  • Having mentioned the risk factor, we would be remiss in not mentioning that the bluechip funds are amongst the highest performers among most equity funds, year on year. These funds have been seen to perform over the benchmark indexes set for them over the last decade.
  • The size and composition of the company alone does not automatically guarantee that the bluechip fund is safe. Even the best in class bluechip equity funds like the Emerging Bluechip Fund carry a moderate amount of risk. But this is easily attributable to all equity funds. The key is to remain invested for a longer time frame to reap the rewards of the fund.
  • They offer stability to your portfolio, with expert handling by the fund manager (but do partner with a reputed fund house when you buy the fund). The fund can normally recover itself in a bearish market, or when there is a downturn for some reason. This is because the fund can ride market volatility much better.
  • Investors have the option of investing in blue chip funds, blue chip ULIPs, etc. This is because the fund moves in the broader market only.
  • They are more expensive. This factor might deter new investors from seeking investment in blue chip equity funds, however, they are a viable option for their growth potential. Yet, it is not ideal to have too many bluechip funds in your portfolio, and you can diversify with a range of mid-cap and small-cap funds.
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September 21, 2018

The key difference between the pro and novice traders

trading optionsTo be a successful businessman, you have to be a pro in the sector you have chosen. It can be a groceries business or a factory business. What you are working within your business doesn’t matter as long as it is legal. But, how you are working and what results you are bringing out of it, matters. And we can agree on this, for better results, you have to be a good performer. To do so, you also need a good plan for your business. Let’s talk about the same thing in the trading business. You also have to be an efficient performer in this business. But, for some people, it is tough to do so because they might not have any idea about how to work efficiently. We will help you (confused traders) with some necessary qualities of the pro traders.

An effective trading edge

Remember, the most important thing in your trading business is your trading edge or trading strategy. No matter, how successful a trader, you have to understand that the most credit of that achievement of his goes to the trading strategy. Yes, other variables do contribute too. But the most important thing is the trading strategy. But, it was not the same when that trader started in this business. With time it got refined more and more. And eventually, it has reached the position to make a trader pro. So, you also have to work with your trading strategy. Even from the beginning, it has to be made by you.

The concept of trading

The concept of trading greatly varies from traders to traders. The successful Singaporean traders always consider this as their business. They never take any chance based on emotions since every action taken by them has a direct impact on their profit factors. If you get involved in options trading, you will understand the importance of trading discipline. The rookie traders always love to challenge themselves. Knowingly or unknowingly they trade with emotions and blows up their account. They don’t really know the key concept of trading. You are here to save your investment not to make your financial conditions much worse. If you think this as your business, you will be able to understand the structure of the investment business. Try to aim for high-risk reward trade setup as it will help you to overcome your loss. Never trade without having a clear trade setup.

Efficient planning for trades

Now you have made your strategy, it is time for you to make plans for your trades. Because every individual trade needs the care to be executed properly. Otherwise, there will be no good result for you after closing a trade. Right when you decide to make a trade, you have to plan for it. And the plan could be for anything that is related to your trading. Like for example, it can be when you are placing your trade or your trading routine. Or most impotent of them all, it can be the money management of your trade. In fact, this is so important that it can save your trading account from vanishing.

Realistic profit estimation

A pro trader probably has spent a lot of time in this business. So, his or her experience of it will be much more than anyone joining recently. Even that trader will understand when there is going to be a mistake by him or her. Because it is also known to that trader. And, with all those experience there will be no place for a pro trader to think on estimation. The brain of that trader will thing about fact and reality, not imagination. And his or her decisions will always be on what is visual in the price charts. And, that is a really good quality of a pro trader. You should try to motivate your mind on thinking about it too.

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August 4, 2018

Placing trades with a strong confirmation signal

trading timeMany people simply put their money at stake in Forex by listening to their mind. They do not feel the necessity of analyzing the chart or looking at the pattern and simply place a trade. If you are one of them, you need to read this article. This article will tell you how you can place your trades with confirmation. The confirmation that we are telling is very easy to know and you do not need to ask your broker. They are all hidden in the signals, the indicators and even in the chart you use. All you need to do is open your eyes and you will realize there are many signs that indicate if a trade is good to place or not. Traders ignore them and they trust their inner voices and they lose their capital. We believe you will not do the same mistake and we are going to tell you the signs that can assure you that it is the right time to place your trades.

Learn price action signal

Using the price action confirmation signal is one of the most effective ways to place a trade. The new traders at Singapore often say they have the perfect skill set yet they are losing money. But do you think they are using price action confirmation signal? You have to learn price action trading to trade the market with confidence. The experienced price action traders are always one step ahead in Forex trading profession. They can easily trade the market with tight stop loss without risking a huge amount of money.

Use of multiple time frame analysis

Multiple time frame analysis is another easy way to filter out the best trades. If you do some research, you will understand trading CFDs is nothing but finding the best trades in the random nature of this market. The aggressive traders might have some edge but they will never succeed in the long run. You have to do some hard work and develop your edge. Never let your emotions take control of you. Emotions have no place in the life of a Forex trader. Always believe in your skills and try to keep yourself updated with the latest news release. Never ignore the power of fundamental factors in the Forex market.

The trends are stable and dominant

One of the key indicators of confirmation of a good trade is the trends are stable and dominant. Traders are always advised to place their trades with the trend because the trend appears when there is money. If you simply place random trades, you cannot get to make your profit. You have to analyze the chart and use your skill to find out when it is the right time to place your trades. You also need to check if the trends are dominant and they are showing on the chart for a long time, indicating they will not go away when you place your trades. It is also important that the trends are dominant and they are not some weak movements by the brokers. The next time you are thinking to place your trades, analyze the quality of the trends and to will know for yourself if it is a good decision.

The market does not have a schedule for any major news release

The news release can unstable the market and it can affect your profit growth. If you want to avoid this risks, check the schedule and finds out if there are any major news planned to release at your expected time. A good trader not only practice their own strategy but they also know the news release and the information. The release of major news creates unexpected volatility and changes in trends that are not predicted and may cost money if traders place trades. Only trade when there is no schedule of the news release and the price movement is steadily changing.

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August 1, 2018

Hope is extremely dangerous for the Forex trader

money tradingHope sounds very promising but still, it can have negative aspects. If you do not believe us, read this article and you will find out the dangers of hope. Most people lose their money because of they hope for too much. There is no match between their expectation and their work and what they get in return is losses. We know it is important to keep your spirit up but most of the time, it does not work in that way. It leads to believing into something miracle and traders begin to lose their track. This article will tell you how hope can be risky for your career. However, it has mostly positive sides but the negative sides are so strong that it can easily derail you from your tracks.

Emotions have no place

We are the human being and it’s very normal to get emotional after losing money. Trading is such a unique profession where you will always have to lose trade. But does this mean you will only lose money in the Forex market? If you know the proper way to find quality trades and trade with discipline, even after losing more than 50% of the time, you will be able to make money. Trade the market with a high-risk reward ratio trade setup. The successful Aussie traders at Rakuten broker always say that trading is all about risk management. If you want to become a profitable trader, trade with discipline.

Rational logic

Taking logical decisions in the investment industry is crucial for your success. In the investment industry, Rakuten Forex is a very popular name since this broker offers elite class service to its client. Being a matured trader you must find a well-regulated broker where you can trade currency pairs without hassle. During your technical analysis, focus on rational logic and throw away your emotions to execute best trades.

Hope makes the traders change their strategy

Imagine you have invested your money in Forex and it is your first time trading. You have no knowledge of the currency industry and you do not know how the volatility works. You placed some trades with discipline for the first few months and you started getting success. No wonder that you are excited and you want to try something new and more profitable. This idea is backed up by your hope because you have a good experience in the past. This is when the dangers of hope are initiated.

You started making plans in your strategy that has proved successful and effective. For example, you started changing the position of the stop-loss and make them bigger. You know it is risky but you are eager to make a huge amount of profit. This leads to destroying your plan and you begin to make random changes. Even if you do not set a big position size, you started using leverages in trends that had favored your trades in the past. Any changes should be revised before they are used in the live industry and hope makes the traders skip this part. As a result, many flaws get into their trading plan and they start losing their money.

Expect unrealistic outcomes

The most dangerous outcome is you begin to harbor unrealistic expectations. You know it is wrong but you cannot realize it at that moment. You are blinded by your hope and overconfidence and your eyes only get opened after losing the capital. Keep your hope in a limit and expect the worst. The industry may not turn out in your favor and need backup plans.

Should I not be hopeful then?

We are not discouraging you from hoping as it shows you the path in darkness. What we want to tell you that it is risky and can involve with your emotion. When it does, it makes you emotional and your decision becomes questioned. Most good trades are made without emotion and are based on the analysis of trends and by assessing the information of the industry. If you want to hope, make sure that it is not having any effect on your trading strategy.

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