How to get a professional trader to trade Forex for you for Free (PAMM accounts Updates)

Having discussed what PAMM accounts are in this post and why they make great investments, many people fail to realize that the you actually get to get a professional manager to trade for you for free. Your only investment will be your initial investment.  The compensation or charges people get charged for on the return is based on the performance of the manager. Hence, your return is technically net the charges which can be said to have been obtained for free.

For example,  my live account with Tspaf PAMM returned 30% after 2 months being half of the return obtained by the professional trader (60%). The way I see it is that the 30% is the actual return of my business net the cost of investing which is the profit. That is basic accounting  Revenue-Cost=Profit. See the performance below;

My Live account  results with Tsapaf PAMM with alpari. (After he has taken his compensation)

(Update on Tsapaf  PAMM 26 Feb 2018). although The returns of the PAMM is still great. I fear for the loss recovery method that lead to a 66% floating loss. That is quite large and could eventually lead to the closure of the account. Do well to note this when you are deciding how much to invest here. I would not suggest it on the long run. Scalptik PAMM account investment may be safer on the long run for me.

 Here is the performance of the original PAMM account

Tsapaf PAMM account performance with alpari

GREAT PAMM accounts Investments

I will like to suggest some sound ones that are safe and are performing well. For this post we will discuss Scalptik PAMM account investment . This investment is great for those who fear those huge drawdown but it comes at the expense of having months with little or no profits. The Risk: Reward is great with  over 300% return in one year alone. Do well to check it out. Note. I am affiliated to Alpari.

Scalptik PAMM account investment performance

Conclusion

You don't have to really on your self anymore to trade Forex.. If you are not comfortable with the performances listed you can select one yourself from hundreds of amazing ones here on their website. Just look for PAMM ratings or invest buttons.  Note I am affiliated to Alpari and all services relates to brokers on this site.

How to diversify your investments across Geo-Political zones.

We have discussed how Geo-political Factors affect ones investments. Now we will discuss how to diversify your investments across Geo-political zones.


The first step in diversifying your investment is finding out and classifying them into these Geo-political zones. You can choose to diversify your investments locally in your country (As banks do) or internationally as international companies do.

To classify investment based on geopolitical zones

Decide and assign a risk factor to each Geo-Political zone: As risk is directly proportional to  geo political zones are not equal. Some are riskier than others. Hence assign a risk factor to each (You can use the higher the factor the riskier the investment). You must also note that risk is directly proportional to rewards so these should not discourage you from making an investment is such zones.

Analyse the exposure and ensure they are not connected or related to each other else you will be double counting:  Connect  Geo-political zones heavily related to themselves as the same risk for instance. Two countries threatening to go to war with each other will face the same risk as related to war.

Divide your investment into slices according to their Geo-Political Zone: Divide your investment into slices and apportion the smaller amount to the riskier ones. So lets say you have $50,000 you will divide it like this. 60% will go into safe investments with risk factor of 1-3 and 40% will go into riskier investments of 5 and above. Now divide the 40%  ($20,000). into the various zones according to the various risks the possess.


Assign a particular percentage of your portfolio to each zone:  Now classify the percentage of your portfolio to each  sub-zone, specifying the amount to invest in each

Review and manage your portfolio and ensure you are adequately covered by periodically re-accessing the risk:  At the time of investing a particular Geo-Political zone may not be risky but as time goes on the risk factor will just shoot up. Take the Brit Exit for instance. A company having its investments there was not facing the risk posed by Brit-Exit such as Higher Taxes, Labour etc. However as soon as the decision was made in 2016, all investments in that region as related to foreign European companies took a hit. Because of this, one must always review their investment periodically to ascertain whether to liquidate them ( sell them off) or add to them.



An Example will be given in the next post

RECOMMENDED: Stock to buy for medium to long term

INVESTMENT GUIDE STOCK ANALYSIS

This is a follow up on the the stocks to watch RSS feed on the app Investment Guide  you can also see the Particular post here posted on January 17, 2018. We will be looking at Lam Research Corp  stock.


The following is a description of the Company.

Lam Research Corporation is a supplier of wafer fabrication equipment and services to the semiconductor industry. The Company designs, manufactures, markets, refurbishes and services semiconductor processing systems that are used in the fabrication of integrated circuits (ICs). It operates through manufacturing and servicing of wafer processing semiconductor manufacturing equipment segment. 

The company has raking in significant revenue which obviously  

Chart of Lam Research Corporation: image source: Investing.com

The recent surge strongly suggest an upward momentum that will strongly favour BUY TRADES in the medium to long term. If you are familiar with RSI you may want to be careful around buying at  a stock at a value which is over 70 and that is the case now. However since we are considering the medium to long term return of the stock this may not be relevant. The dividend of this company also currently stands at $0.5 having been increased from $0.45 last year

The downside to buying the stock on the long term is the agreement to company recently announced a   $2 billion share repurchase authorization which if triggered will require owners of shares to sell their Shares back to the company. 

Other than the above points I feel the stock is a a good stock to buy given the potential to soar by 50-100 points this year.

Other data of Lam Research Corporation  (LRCX)  from investing.com

Why you must diversify your Investment portfolio across Geographical Region

All investments carries certain amount of risk whether it be (Forex, Stocks, ETFs, Mutual Funds, Crypto-currencies, commodities etc )as it relates to loosing ones capital, however few people are aware that investments also carry Geo-Political risks.  Other than balancing your portfolio based on volatility. 

Geo-Political Factors affecting your investments

The following are some of the ways the Geo-Political factor discussed can affect your investments

• Change in Government Policies: Economic downturns are often followed by change in government policies which tend to seriously hamper or promote your investments. A good example of this is the Tax Cuts introduced by Donald Trump in 2016 that would lead to increase the overall net profits and Dividends of all stock investments.
• Political uncertainty and instability: Political Upheavals like the recent crisis in Turkey seriously shook the stability of the region and also the investments that made the stocks to fall by over 2.5% on that day alone.
• Natural disasters are also known to affect investments: the routine earth quakes in the middle east, the hurricanes in the west can and do affect ones investments adversely. They could shutdown or damage a factory hence lead to significant losses.

As a result of the above factors, diversifying your  portfolio across Geo-Political Zones  offers the following benefits.

Benefits of Diversifying your Portfolio based on Geo Political Location

1. It will protect your investments from changes in the political instability: 
2. It will reduce your exposure to Geo-political zones such that the impact on your investments will be limited
3. It will give your investment a more global outlook which is generally safer than investing in just one country.
4. It allow you to stay abreast of all news across many geopolitical zones which in turn will allow you to be open to new opportunities as they arises

In our next post will address how to go about this.

Top things to consider before buying stocks

Picking the right stocks can be challenging for most new would be investors. Most people tend to choose a stock that has been recently trending or blue chip stocks (Stable expensive stock of very financially stable companies.)  As an investor stating in the market how should you go about it?

The following must be checked before buying a stock.

Check for financial stability usually marked by steady  or increasing profits: you will want the profits of the company you are investing in to be on an onward rise primarily because companies (especially those listed in the stock market) needs profit to grow or survive. As a result of this is is a must have criteria for investing in such companies. For high growth companies you must look for growth potential and not profits because at a tender age are likely to be making losses.

Check for companies that are innovative in nature: The competitive nature of the corporate world demands that companies must be innovative to stay in the competition. One must always shy away from companies that see themselves as "too big to fail" companies that treat their clients as shit and pay little or no attention to employee development or the likes are bound to fail. They must also be active in their Research and Development (also known as R & D).

Ensure that the price is not overbought/Overpriced:  There are some instances when companies having all the right stock metrics are overpriced (That is a lot of people have already bought the stock beyond its actual value) this was what happened to amazon and google that also crashed during the the 2000-2001 dot-com bubble bust. The companies were actually great innovative soon to be financially stable companies but where overpriced due to the hype that internet commerce was the next big thing. The earnings per share ratio helps with this. The earnings per share ratio must not be exceedingly.

In Summary

Having said the above, there are other things you  may want to check like the  interest coverage ratio which shows how the company will be capable of handling its interest expenses incurred from long term debt. However, the ones above are must have if your stock is to grow astronomically in the next 5-7 years.

RECOMMENDED RESOURCES

GOOD TO GREAT: This is an exceptional book read by many CEOs and would be investors about the essential qualities companies whose stock multiplied by 1000% and lasted for 50 years had. Do well to read them.

HONEY WELL STOCK- What you must consider before buying this stock

We have discussed why you should on an intel stock(Intel Corporation (INTC) ) on a short term here, we have analyzed Square which was also listed on how stock pick investment apps. (You can follow them via the RSS feed in our Investment Guide app. 

A typical bullish market was spotted  by the analysts at Investing however the following should be noted before making your decision to buy

• They have been no significant increase in the net income: Share prices are often the reflection of future dividend cash flow. The current growth rate of the stock has not been as impressive as the  rise in the stock price. 

Honey well stock chart(source Investing.com)

Honey Well  Profits in the last 3 years (source:Investing.com)

• The value of RSI(14) 68.329 close to the overbought range of 70 may not be a good sign do well to put this into consideration before buying the stock.

In summary

The price is bound to push up in the very short term but given the warning signs one may have to watch out for a short(sell trade in the coming months/year). Forcast of profits is promising though and guarantees a short term profit

Honey well stock  forecast (source Investing.com)

Should I buy an Intel Stock( January 2017)

Having discussed the prospect of investing in the stock market here. One of the recommended investment to invest in Intel Corporation (INTC) stock. 

Intel has been bullish of late especially after the third quarter in Oct 2017.

The fundamental indicators and technical indicators strongly suggests the price of the stock is going to reach the $50 mark. It's as of December 2017 its current yield stands at %2.36 hovering over an annualized amount of $1.

Call to action Buy 

Take Profit Target 50-55

Pros

• Intel has a good hold in the tech industry: Fortune magazine enlists them as the "world's second largest and second highest valued semiconductor chip makers based on revenue after being overtaken by Samsung".
• Their revenue has been on an increase off late
• They are a dividend paying stock
• Their financials look Ok medium term and have a good financial management team

Cons

• Their stock price has been quite stagnant over a long period of time
• There are other stocks that are likely to give better returns on a medium term.
• The is a tendency that the stock  may peak soon.