Investment View

15 Must-Have Free Software Programs for Your PC

Mark — Tue, 24 Nov 2009 02:02:41 +0000

http://www.makeuseof.com/tag/roundup-15-free-must-install-programs-for-your-new-pc/

http://free.avg.com/gb-en/homepage

www.auslogics.com/en/software/disk-defrag/overview

www.glaryutilities.com/gu.html?tag=download

www.malwarebytes.org/mbam.php

http://www.izarc.org/download.html

http://picasa.google.com/

www.dopdf.com

http://www.guyswithtowels.com/downloads.html

http://xviservicethief.sourceforge.net/index.php?action=downloads

https://mozy.com/registration/free/

www.digsby.com

http://www.videolan.org/vlc/

http://www.foobar2000.org/download

http://www.imgburn.com/index.php?act=download

16. Revo – Free powerful uninstaller for Windows. It can uninstall programs that you are not able to remove using Windows’ default program manager.

17. OpenOffice – Free alternative to Microsoft Office. Though requires some adjustments to program settings before it can fully replace the Microsoft Office.

18. Foxit – This one is basically a lightweight replacement to Adobe PDF reader. With Foxit you may launch PDF documents as fast as notepad files.

19. Spyware Terminator – A compliment to the above mentioned Malwarebytes. It’s not as comprehensive but comes with real-time malware detection and fast daily scans.

20. Portable Apps – A huge collection of free programs that you can carry on your USB thumbdrive. The suite includes several of the above apps, plus many more. Carry your favorite computer programs along with all of your bookmarks, settings, email and more with you where ever you go. Use them on any Windows computer without leaving any personal data behind.

S&P500 in Gold

Mark — Wed, 18 Nov 2009 11:38:31 +0000

http://www.philstockworld.com/2009/11/17/25-off-the-top-tuesday/

Investment Psychology

Mark — Thu, 12 Nov 2009 03:42:07 +0000

http://www.retro.ms11.net/InvestorMind.gif

I.M.F. Sells Gold to India

Mark — Thu, 05 Nov 2009 02:14:01 +0000

November 4, 2009

By REUTERS

MUMBAI — The International Monetary Fund has sold 200 tons of gold to the Reserve Bank of India for $6.7 billion, quietly executing half of a long-planned bullion sale that could slow the rising price of gold.

The sale, which surprised traders who expected China to be the leading buyer, will relieve gold investors of some uncertainty over how and when the I.M.F. would sell 403.3 tons of gold — about one-eighth of its total stock.

It also fueled speculation that other governments — including Beijing — might be ready to diversify their reserves, even at near-record gold prices, helping to soak up I.M.F. supply that the fund might otherwise be forced to sell on the open market.

“Central banks in India and China will be happy to accumulate gold at these levels,” said Aaron Smith, the Asia head of the $1.65 billion technical trading fund Superfund. “I will not be surprised to see even some Southeast Asian banks buying gold.”

Spot gold prices rose about $4, to $1,063 an ounce, Tuesday, just shy of the $1,070.40 record set last month, aided primarily by a falling U.S. dollar. Traders said the I.M.F. news could add to the market’s upward momentum.

Although the I.M.F.’s plan to sell a share of its gold holdings to increase low-cost lending to poor countries had been flagged for a year before it was formally approved in September, both the speed of the deal and the buyer were a surprise.

India is the biggest consumer of gold, primarily in the form of jewelry and investment, but its central bank had given few indications of being a front-runner in the move to diversify into bullion.

The proportion of gold as part of its total foreign reserves had fallen in past decades, officials said.

India’s foreign exchange reserves held at the central bank totaled $285.5 billion on Oct. 23, of which gold made up somewhat more than $10 billion. The latest purchase will lift its share of gold holdings to about 6 percent from near 4 percent — less than most of the developed world but four times China’s share.

Bimal Jalan, a former governor of the Reserve Bank of India, said the move was aimed at increasing resources for the I.M.F., as India and China had promised to help raise “fungible resources” to help other developing countries.

“This transaction is an important step toward achieving the objectives of the I.M.F.’s limited gold sales program, which are to help put the fund’s finances on a sound long-term footing and enable us to step up much-needed concessional lending to the poorest countries,” the I.M.F.’s managing director, Dominique Strauss-Kahn, said in a statement.

A senior I.M.F. official, speaking on condition of anonymity because of the sensitivity of the matter, would not say whether other central banks had expressed interest in buying the remaining gold for sale. He said the I.M.F. would proceed as planned to sell the gold in the market if no other central banks came forward, but he reiterated that the fund would publicize its intentions before doing so to avoid disrupting the market.

Still, the threat of further open-market sales remained a source of concern for gold traders, who were mindful of the five-year pact among European central banks to sell down a maximum 400 tons a year of their holdings, an agreement that was renewed in August and included the I.M.F. volume.

The market’s focus has now shifted to China as Beijing seeks to shift some of its more than $2 trillion in foreign exchange reserves away from the U.S. dollar.

A representative from the Chinese central bank was not immediately available for comment.

It is the first time since 2000 that the I.M.F. has sold gold to a central bank.

http://www.nytimes.com/2009/11/04/business/global/04imf.html?_r=1&pagewanted=print

Keeping your composure is the true test of your risk tolerance

Mark — Mon, 02 Nov 2009 21:35:22 +0000

http://www.marketwatch.com/story/story/print?guid=4F5AC08F-40B4-4DEC-8996-B1D67D77E2F5

WEEKEND INVESTOR

Oct. 30, 2009, 5:05 p.m. EDT

Tune in, chill out

Keeping your composure is the true test of your risk tolerance

By Jonathan Burton, MarketWatch

NEW YORK (MarketWatch) — Warren Buffett became rich and famous because of one deceptively simple investment rule: “Be fearful when others are greedy, and be greedy when others are fearful.” By “others,” he means us.

We may think we know ourselves as investors. We dutifully complete questionnaires that purport to show whether we’re daredevils or doormats. We seek counsel from advisers and are wary of tips from relatives and friends. And we’re convinced that when bad things happen, we’ll make the right, reasoned calls to protect our hard-earned wealth.

What kind of investor are you?

Greg Davies, who heads the behavioral-finance unit at Barclays Wealth, has identified several types of financial personalities based on risk-handling and decision-making abilities. MarketWatch’s Jonathan Burton is put to the test.

But all that really gives us is a broad and inexact measure of our risk tolerance, how much volatility — a smooth ride down Wall Street or something more exciting — we can stomach in our investment portfolios over time.

“We overestimate our abilities,” said Dan Ariely, an economics professor at Duke University and author of “Predictably Irrational,” which examines investor decision making. “People say they’re willing to lose 20%, then they lose 2% and they panic.

“Nobody really knows what they can tolerate until they’re in that situation,” he added. “I could call you up and say you just lost 10% — now you would really feel it.”

A more meaningful indicator is composure — your short-term, emotional reactions to unpredictable and uncertain events, such as the market’s ugly sell-off on Friday.

How will you handle yourself in the heat of battle? Far too many investors discovered in 2008 and early this year that losing money in quick, sharp cuts was more than they could bear. Those thoughtful risk-tolerance quizzes got shredded when stocks went into free fall. Panicked investors sold what they could, often at any price.

Buffetts among us

Had they anticipated the worst, investors could have put less money in stocks and lowered their risk exposure. A less-volatile portfolio might have kept them on the field when the market rebounded.

Instead, many former shareholders are now on the sidelines — with the Standard & Poor’s 500-stock index (INDEX:SPX) up more than 50% since March. They’re skeptical, fearful and unsure if, when, or how to get back in.

There’s a good reason why there aren’t more Buffetts among us: Buffett is not only more risk tolerant, he’s more composed. When the shooting starts and money is on the line, Buffett comes across as cool and unemotional. And he fires back. Think Clint Eastwood with a calculator.

“To the degree you’re able to anticipate how you feel, you’re going to be composed,” said Donald MacGregor of MacGregor-Bates Inc., a Eugene, Ore., firm that researches consumer judgment and decision-making. “You’re not going to have a knee-jerk reaction.”

“Composure is about risk attitude — the emotional responses to my portfolio day-to-day, month-to-month,” added Greg Davies, head of behavioral analytics at Barclays Wealth, a unit of Barclays Plc., who researches investor behavior. “Understand where you fit and build your investment program around that.”

Truth time

Standard risk-tolerance questionnaires usually don’t say much about composure. Often they ask for responses on a scale of 1 to 10, but there are too many variables for any accurate reading. The same holds for questionnaires that assume investment knowledge, such as whether you’re more comfortable in high-yield bonds or dividend-paying stocks.

“We’ve never used risk tolerance questionnaires because we’ve never found them meaningful,” said Ross Levin, a financial adviser in Edina, Minn. “In the middle of a crisis, that intellectual exercise doesn’t help you emotionally.”

Barclays Wealth created a survey that factors composure into its questions about risk tolerance, asking people to rate their answers on a scale from “strongly agree” to “strongly disagree.” And some of the questions are not necessarily about investing. For example: “I am not easily bothered by things,” “I get stressed easily” and “Uncertainty makes me uneasy, anxious or stressed.”

“Higher composure is better for the average investor,” Davies said. “If you don’t have the knowledge and expertise to be making good short-term decisions, you should probably stay away from them. Higher composure helps. Doing less rather than more is almost always a good idea.”

How can you build your composure?

First, commit to an investment policy with a long-term or big-picture focus that recognizes there will be major pitfalls along the way. This is your battle plan.

“An investment policy statement helps govern decision-making in times of stress,” said Michael Pompian, a New Jersey investment adviser. “In March 2009 it looked like the world was melting down and people’s emotions started to take over. All they could think about was the negative. An emotional intelligence is what’s really critical during times when there’s a desire to withdraw from a structured investment process.”

The most effective policy statement lays out objectives. These include return goals — how much money you’d like to make — and the potential obstacles to that happy outcome, Pompian said.

In this way, you get a sense of how emotions dictate your actions. You better understand your “loss tolerance,” Pompian added. “Nobody is concerned with upside risk; it’s downside risk.”

If you are someone with low composure, you’ll need rules against snap decisions. Draw up the list in calmer moments, not during the storm, “so that when the hurricane hits there will be no doubt as to what the intentions are,” Pompian said.

Second, divide your wealth into different mental accounts with varying degrees of risk.

Levin, the Minnesota financial adviser, suggests three “buckets”: one for income, one for inflation-protection, and a “legacy bucket” for heirs and charity.

“You take more risk in the legacy bucket, are balanced in the inflation bucket, and income-oriented in the income bucket,” Levin said.

Also, don’t become overly invested in any one type of asset or sector. For instance, you could have money in value stocks, real estate investment trusts and financial services stocks and say you’re diversified. In fact, noted John Nersesian, a managing director at Nuveen Investments, you’d be heavily exposed to the credit markets.

“Investors should not be diversifying asset classes; they should be diversifying risk,” he said.

Finally, don’t just do something — sit there. Be reflective, not reflexive. If you are investing long-term, stick to it. Resist the temptation to trade.

As humans, we are programmed to avoid pain. As investors, it’s been proven that the pain of a financial loss is more acute than the pleasure of a monetary gain. In an effort to eradicate that pain, people act irrationally and emotionally. Try to keep your head. If you’ve preplanned for unfortunate events, you won’t be so shocked and feel compelled to act.

“The question,” said Ariely, the Duke professor, “is which one of your two selves is the correct one” — emotional or rational? “People think it’s not the emotional one. But the fact is that we live with our emotions as well.”

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Trade like a fund manager

Mark — Mon, 02 Nov 2009 11:54:58 +0000

http://www.marketwatch.com/story/trade-like-a-fund-manager-2009-11-02

By Mark Hulbert, MarketWatch

ANNANDALE, Va. (MarketWatch) — It’s somehow fitting that as traders focus their sights on November, our political leaders are focusing on compensation reform.

That’s because pay incentives are also key to determining which trading strategies are likely to be most and least profitable this month.

To be sure, the pay incentives of greatest interest to traders are not those for bank CEOs, which are the focus of the current political debate. Instead, the ones most relevant to traders are those that prevail for mutual fund managers.

I concede that the relationship between November’s trading strategies and fund managers’ compensation is not at all obvious. But that relationship nonetheless exists, and shrewd traders may want to try exploiting it.

The key to understanding this otherwise inscrutable relationship is an appreciation of what needs to happen for a fund manager to earn a year-end bonus. In most cases, earning that bonus depends on outperforming a pre-determined benchmark, and by far the most commonly used benchmark is the S&P 500(SPX 1,036, -29.92, -2.81%).

Believe it or not, the seemingly innocuous decision of which benchmark will be used to judge their performance has profound consequences for how managers behave.

Consider first a manager who right now is ahead of the S&P 500 for year-to-date performance. Even if he is behind the Russell 2000 for year-to-date performance, this manager knows that if he can hold on to his lead above the S&P 500 for another two months — until December 31 — he probably will earn a decent bonus.

He thus will have an incentive to make his portfolio look more and more like the S&P 500, which will have the effect of locking in his lead. That means he will tend to be a net seller of secondary stocks that are not part of the S&P 500.

Money managers who currently are behind the S&P 500 also will have an incentive to reorient their portfolios to be more like the S&P 500. That is because their desire to take on more risks in order to possibly rise above the S&P 500 by year’s end will be outweighed by the fear of losing their bets and lagging the S&P 500 by a large margin — in which case even their jobs might be in danger.

One implication of this reduced appetite for risk as the year progresses is that the beginning of the year will be a lot different than the end of the year. That’s because, once Jan. 1 rolls around, managers’ compensation slates will be wiped clean. Their willingness to take risk, which often manifests as an eagerness to bet on secondary stocks, will be at the highest point it will be all year.

That in turn means that managers in January will likely be net sellers of the large caps they increasingly will be purchasing over the next several weeks, while being net purchasers of the secondary stocks that they will be selling in the near term. Because of this tendency, large caps are likely to outperform small caps in November and December, while just the reverse is likely to be the case in January. (This latter tendency, by the way, is the source of the well-known year-end seasonal pattern that is known as the January Effect.)

This isn’t just theory, by the way; it has been documented by any of a number of academic studies. One that provides a good summary of the data supporting the theory was authored by two finance professors, one of whom is also an economist at the Federal Reserve Bank of Atlanta. Click here for a copy of the study.

What would a trading strategy look like that tries to exploit this tendency? A particularly aggressive one would be to simultaneously buy an exchange-trading fund that reflects the S&P 500 index (such as the SPIDERS S&P 500 (SPY 103.56, -3.09, -2.90%)) and sell short an ETF that reflects the small-cap sector (such as the iShares ETF that is benchmarked to the S&P Small Cap 600 index (IJR 49.42, -1.42, -2.79%)). Notice that such a strategy makes money regardless of whether the overall market goes up or down — provided that the S&P 500 does better than secondary stocks.

A more conservative strategy would be to reduce your holdings of secondary stocks now and replace them with stocks that are part of the S&P 500 index. Such a strategy doesn’t require selling short, though it is vulnerable to a decline in the overall market.

For those of you who are interested in such a strategy, here is a list of the stocks that currently are most recommended by those investment advisers who have beaten a buy-and-hold in the stock market over the last decade on a risk-adjusted basis. The list is in order of their popularity, with the most popular stock on top:

AT&T Inc. (T 25.67, -0.56, -2.13%)
Johnson & Johnson (JNJ 59.05, -0.81, -1.35%)
Wal-Mart Stores Inc. (WMT 49.68, -0.72, -1.43%)
International Business Machines (IBM 120.61, -2.26, -1.84%)
Automatic Data Processing Inc. (ADP 39.80, -0.45, -1.12%)
Abbott Labs (ABT 50.57, -0.29, -0.57%)
Chevron Corp (CVX 76.37, -1.41, -1.81%)
General Electric Co. (GE 14.26, -0.61, -4.10%)
Hewlett Packard Co. (HPQ 47.46, -0.89, -1.84%)
Lockheed Martin Corp. (LMT 68.79, -0.70, -1.01%)
Microsoft Corp. (MSFT 27.73, -0.49, -1.74%)
Unitedhealth Group Inc. (UNH 25.95, -0.52, -1.96%)
AFLAC Inc. (AFL 41.49, -1.68, -3.89%)
PepsiCo Inc. (PEP 60.55, -0.84, -1.37%)
Coca-Cola Co. (KO 53.31, -0.78, -1.44%)

Mark Hulbert is the founder of Hulbert Financial Digest in Annandale, Va. He has been tracking the advice of more than 160 financial newsletters since 1980.

China’s Power Consumption Goes Up

Mark — Sun, 01 Nov 2009 12:48:06 +0000

http://blog.rebeltraders.net/2009/10/20/chinas-growth-does-not-abate-power-consumption-goes-up/

China’s power consumption in September rose 10 percent year-on-year to 322.4 billion kilowatt hours, the fastest pace of growth since June last year, the China Electricity Council said on its Web site on Oct. 15.

The increase followed 8 percent growth in August and indicated continued economic recovery, it said.

Power generation in August gained 9.3 percent year-on-year to a record 344 billion kWh, as demand from manufacturing plants soared in line with rising consumption fueled by the government’s stimulus spending. The council did not provide output figures for September.

Power consumption in the first nine months rose 1.4 percent year-on-year to 2.7 trillion kWh, it said.

Grid operators sold a combined 2.2 trillion kWh of electricity in the first nine months, up 3.2 percent year-on-year, it said.

A total of 199.7 billion yuan was spent on construction of power plants in the first three quarters, 83.2 billion yuan of which went on coal-fired projects.

China added 49 million kWt of generating capacity in the first nine months, comprising 32.9 million kWt of thermal power, 12.1 million kWt of hydropower and 4 million kWt of wind power, the council said.

A total of 219.2 billion yuan was spent on grid construction and upgrades, it said.

The 10 percent year-on-year growth rate of power consumption in September was “normal” in comparison with a decline in consumption a year earlier, Yang Zhishan, a power analyst with CITIC Securities Co. Ltd., told Caijing.

Year-on-year growth in power use during October and November will likely reach 15 percent and 20 percent, respectively, Yang added.

Power consumption began falling year-on-year last October amid the global downturn. It began to grow again in June, when it expanded 4.3 percent. Growth rose further to 6 percent in July and 8.22 percent in August.

Goldman Sees `False Bottom’ in U.S. Housing While Merrill Sees a `Treat’

Mark — Wed, 28 Oct 2009 10:51:10 +0000

Goldman Sees ‘False Bottom,’ Merrill Sees ‘Treat’

Oct. 27 (Bloomberg) — The stabilization in U.S. home prices won’t last, according to economists at Goldman Sachs Group Inc. in New York. Their counterparts at BofA Merrill Lynch Global Research see a “treat” rather than a retreat.

“The risk of renewed home price declines remains significant,” Alec Phillips, an economist based in Goldman’s Washington office, said in an Oct. 23 note to clients. “Our working assumption is a further 5 percent to 10 percent decline by mid-2010.”

“We should expect subdued home price appreciation over the next few years,” wrote Merrill Lynch’s Ethan Harris and Drew Matus on the same day.

Both camps agree government stimulus programs, including the $8,000 first-time buyer tax credit, foreclosure moratoria and Federal Reserve purchases of mortgage-backed securities, have helped stem the slump in housing. At the center of the debate is how much influence these initiatives have had, and therefore what happens after they expire or wane.

On the supply side, the programs have reduced the number of foreclosed houses reaching the market by about 450,000, according to Goldman calculations, said Phillips. They have also boosted sales by about 200,000 homes, he said.

‘Temporary Factors’

“Taken together, these moves might have added 5 percent to home prices nationally,” Goldman’s Phillips wrote. “If this estimate is correct, it suggests that most of the increase in home prices since this spring — which has totaled between 2 percent and 4 percent in seasonally adjusted terms — has been due to temporary factors.”

The latest reading on one of those measures came today. The S&P/Case-Shiller index covering 20 U.S. cities climbed 1 percent in August from the prior month, the third consecutive increase. The measure was down 11.3 percent from August 2008, the smallest 12-month decrease since January 2008.

Combined sales of new and existing homes totaled 5.52 million at an annual rate in August, up 15 percent from a January low, according to figures from the Commerce Department and the National Association of Realtors.

Purchases of previously owned houses jumped 9.4 percent in September, the most since comparable records began in 1999, the real estate agents’ groups reported last week. Figures on September sales of new houses are due from the Commerce Department tomorrow.

“Much of this strength seems to have been policy- induced,” Phillips wrote in a section of the report titled: “A False Bottom?”

Halloween ‘Treat’

“While tax credits and distressed property sales may be influencing both sales activity and prices, they are not the primary force behind the rebound in housing,” Merrill Lynch’s Harris, head of North American economics, and Matus, a senior economist, wrote in a Halloween-themed report that likened the improvement to a “treat.”

Halloween is the Oct. 31 celebration in the U.S. when children go door-to-door “trick-or-treating.” They wear costumes, ask for sweets and play pranks.

Home prices have fallen so much that prospective buyers no longer expect them to drop much further, said Harris and Matus, citing results of a question asked by the Reuters/University of Michigan survey of consumer sentiment.

‘Dramatically’ Affordable

The price drop has also made homes “dramatically” more affordable, they said.

“This combination of factors has created enough renewed demand to offset the ongoing negative impact of rising unemployment and foreclosures,” Harris and Matus said.

The improvements will only lead to “subdued” price increases over the next few years because of “the magnitude of the housing downturn and high level of inventories,” the Merrill Lynch economists concluded.

The differing views on housing may help explain the banks’ divergent views on the economic outlook. Goldman projects the U.S. economy will grow 2 percent in 2010, while Merrill Lynch forecasts a 3.1 percent expansion.

To contact the reporter on this story: Carlos Torres in Washingtonctorres2@bloomberg.net

Last Updated: October 27, 2009 09:09 EDT

http://www.bloomberg.com/apps/news?pid=20603037&sid=aJA4qY0M7Xyw

Tricks of the Trade

Mark — Wed, 28 Oct 2009 10:22:09 +0000

EW YORK (TheStreet) — “Sometimes it feels like there’s no pattern to to the markets,” Jim Cramer told the viewers of his “Mad Money” TV show Tuesday.

Today, for example, steel stocks such as US Steel (X Quote) got clobbered, while other industrial stocks, like chemical company PPG (PPG Quote), a stock which Cramer owns for his charitable trust, Action Alerts PLUS, finished strong. Oil giants ExxonMobil (XOM Quote) ended higher, meanwhile oil driller Transocean (RIG Quote), finished sharply lower. What’s going on? Cramer said we need only look at the calendar.

Cramer reminded viewers that we’re just three days away from the end of the month, and the end of the fiscal year for many hedge funds and mutual funds. He said this means the race to “mark up,” or take higher, a fund’s largest positions has begun.

Cramer explained that many funds will bolster their quarterly and yearly performance by buying more of the stocks it already owns, thus taking those stocks higher. “Every dollar matters to these guys,” he said, so even a small bump can make a huge difference in a billion dollar portfolio.

Since enforcement officials watch for this “less-than-ethical” maneuver on the last day of the month, Cramer said most funds will begin their buying throughout the first part of the last week of October, and end on Thursday, the day before their fiscal years officially end. This mark-up buying, he said, will send some stocks higher, seemingly for no reason at all.

Cramer said the markets will not make much sense for the next three days. He said investors looking to cash in some stocks should wait until Thursday to receive the best price, while those looking to buy into the highest of high-flying names may be better off waiting until next week’s trading.

Pound Is Poised for Goldman Rally

Mark — Mon, 26 Oct 2009 10:01:21 +0000

http://www.bloomberg.com/apps/news?pid=20601087&sid=aqoJW.D730pA

‘Too Bearish’

Goldman Sachs advised clients to buy the pound in March, and dropped the recommendation when the currency climbed to $1.65 in June, a bet that returned 12 percent when accounting for changes in interest rates. It began backing the pound again on Oct. 15.

“The market is way too bearish on the U.K. economy and way too short sterling,” said Thomas Stolper, an economist at Goldman in London. “The Bank of England has a history of surprising the market.” King may boost rates as soon as April, said Stolper.

Barclays predicts the pound will rise about 8 percent to $1.76 in March, and gain 7.6 percent to 85 pence per euro.

“There’s more inflation pressure in the economy than people realize,” Paul Robinson, a currency strategist at Barclays Capital in London who worked as an economist at the Bank of England for 11 years until 2006. “The BOE is likely to tighten policy a bit earlier than the market thinks. Sterling has to appreciate as the clouds clear.”