In contrast to what the majority of people think, currency trading isn't all that easy, particularly for a sloppy new trader. Here's 4 forex trading fundamentals that will place you on course and assure your continuous profits for many years.
A good knowledge of the basics of Forex trading is the minimum required in order to start your career as a forex trader. Below are some of the facts that any trader should have on their fingertips before entering the world of Forex trading.
Forex trading is not easy
Most brokers will mislead you and tell you that forex trading is very easy just so that you open an account. The Forex market is not a get rich quick scheme and actually, about 95 percent of beginners fail. Make sure you educate yourself and practice trading seriously before you invest a penny. Don’t be get discouraged though, profitable forex trading is accessible to anybody committed to learn. The problem is that most people are too lazy to follow instructions. It has been proven that anyone can enter the Forex market with the right information and grow their accounts from nothing to hundreds of millions; you might not be able to achieve this but you sure will be successful.
You do not need to work hard, be clever or intelligent to win
Forex trading may not be the perfect job for everybody but that doesn’t mean at all that you need to push yourself over your limits. All you need is to work in a smart way. You can learn this trade within a short period and be successful. Not all millionaires are smart, actually most of them have an IQ below average. Most of them are just normal people who know how to follow basic instructions. They might not know a lot about the involved math, but they sure know how to play their cards, avoid losses and maximize profits.
Keep everything Simple
The Forex market does not require complicated math, you just have to play it simple and you will win. Do not listen to individuals who say that prediction is important in winning. Predictions are as accurate as horoscopes, always disappointing. Pay attention to your forex charts, they are the only thing that would tell you the truth and will never lie to you.
Use a goof money management
You cannot make big gains if you cannot control losses. It is quite easy to blow your account especially if you do not have a money management strategy in place. Winning in the Forex market requires that you have discipline. In any trading plan you make, be sure to include a strict money management, as it’s the only tool that will avoid you serious losses. You also need to be persistent and keep on going taking every loss as a lesson.
If we want to compare Forex trading to a train, then the trading system is the railroad to that train.
In Conclusion
The main aim of the Forex trading basics is to show you that you can be successful, but success will not come on a silver platter. Always build a system that complies with your character. You can generate substantial profits from the forex market, but nothing is easy; you will have to work hard to reach a point where you can live from your forex profits.
By: Owen Moore
Monday, August 22, 2011
Friday, April 22, 2011
The New Living Benefits In Variable Annuities
GMIBs. GMWBs. GMABs. GLWBs. What do these acronyms mean? If you own a variable annuity or think you might want to own one, they stand for a new class of living benefits that make these investments even more attractive.
Variable annuities are tax-deferred investments structured to pay you benefits over a set number of years, and a death benefit to your beneficiaries. They let you invest some of your annuity assets in investment subaccounts that suit your investment styles and goals.
Additionally, these annuity contracts often come with riders that guarantee certain benefits regardless of how the markets perform: GMIBs, GMWBs, GLWBs, and GMABs.
Guaranteed minimum income benefit (GMIB). A GMIB ensures that the annuity payments that come your way are at least a specified minimum amount, even if your investment subaccounts perform poorly (the insurer picks up the slack). How is the minimum payment amount figured out? It is based on the insurance company’s estimation of the future value of the initial annuity investment.1
Guaranteed minimum withdrawal benefit (GMWB). If the principal of your variable annuity shrinks due to a market downturn, you can use this rider to recoup the amount of your entire initial investment. If you own a variable annuity with a GMWB with a 10% withdrawal rate, you can withdraw 10% of your entire investment each year until the initial investment amount has been recouped. That’s useful if the value of your annuity should decline. If you started your variable annuity with a $200,000 investment and it is now worth $180,000, you can use the 10% GMWB to withdraw $20,000 of the original principal amount each year until the entire $200,000 is recovered thanks to the guarantee set by the insurance company.2
Guaranteed lifetime withdrawal benefit (GLWB). This means guaranteed income payments for life. Let’s say your variable annuity has an account balance of $100,000 and is structured to pay out $5,000 a year for 20 years. With a GMWB for life, you will continue to receive $5,000 a year from the insurer even if you have recouped the original principal and even if the account value falls due to poor investment returns.3
Guaranteed minimum accumulation benefit (GMAB). A GMAB gives you the confidence of knowing that after a set period of years, you will have at least X dollar amount of assets in your variable annuity. Usually, the GMAB is established for the end of a 10-year period, i.e., in ten years, the insurer guarantees that your annuity contract will be valued at a minimum of $100,000, even if the market drives the actual value down.4
Long-term care insurance options. This is certainly a new wrinkle in variable annuities and worth knowing about. Some variable annuities now allow you to pay long-term care benefits from the life insurance death benefit promised in the annuity contract. While this will reduce the amount of the death benefit, it can certainly help during your life. If you don’t choose to spend some of the death benefit on long-term care, then the entire death benefit will be received by your heir. You can also choose to receive the cash value of the death benefit as an income stream.5
Very interesting, isn’t it? If you’d like to know more about the new living benefits in variable annuities, why not talk to a qualified insurance or investment professional today? These new annuity options may give you more financial confidence – and financial choices - for retirement.
Please note that variable annuities are long-term investment vehicles designed for retirement purposes. Investing in variable annuities involves market risk, including possible loss of principal. Investors should carefully consider the product’s investment objectives, risks, limitation, charges, and expenses. The variable annuity prospectus and underlying sub-account prospectus contain this and other important information. These prospectuses should be read carefully before investing.
By: Ishan Goradiya
Variable annuities are tax-deferred investments structured to pay you benefits over a set number of years, and a death benefit to your beneficiaries. They let you invest some of your annuity assets in investment subaccounts that suit your investment styles and goals.
Additionally, these annuity contracts often come with riders that guarantee certain benefits regardless of how the markets perform: GMIBs, GMWBs, GLWBs, and GMABs.
Guaranteed minimum income benefit (GMIB). A GMIB ensures that the annuity payments that come your way are at least a specified minimum amount, even if your investment subaccounts perform poorly (the insurer picks up the slack). How is the minimum payment amount figured out? It is based on the insurance company’s estimation of the future value of the initial annuity investment.1
Guaranteed minimum withdrawal benefit (GMWB). If the principal of your variable annuity shrinks due to a market downturn, you can use this rider to recoup the amount of your entire initial investment. If you own a variable annuity with a GMWB with a 10% withdrawal rate, you can withdraw 10% of your entire investment each year until the initial investment amount has been recouped. That’s useful if the value of your annuity should decline. If you started your variable annuity with a $200,000 investment and it is now worth $180,000, you can use the 10% GMWB to withdraw $20,000 of the original principal amount each year until the entire $200,000 is recovered thanks to the guarantee set by the insurance company.2
Guaranteed lifetime withdrawal benefit (GLWB). This means guaranteed income payments for life. Let’s say your variable annuity has an account balance of $100,000 and is structured to pay out $5,000 a year for 20 years. With a GMWB for life, you will continue to receive $5,000 a year from the insurer even if you have recouped the original principal and even if the account value falls due to poor investment returns.3
Guaranteed minimum accumulation benefit (GMAB). A GMAB gives you the confidence of knowing that after a set period of years, you will have at least X dollar amount of assets in your variable annuity. Usually, the GMAB is established for the end of a 10-year period, i.e., in ten years, the insurer guarantees that your annuity contract will be valued at a minimum of $100,000, even if the market drives the actual value down.4
Long-term care insurance options. This is certainly a new wrinkle in variable annuities and worth knowing about. Some variable annuities now allow you to pay long-term care benefits from the life insurance death benefit promised in the annuity contract. While this will reduce the amount of the death benefit, it can certainly help during your life. If you don’t choose to spend some of the death benefit on long-term care, then the entire death benefit will be received by your heir. You can also choose to receive the cash value of the death benefit as an income stream.5
Very interesting, isn’t it? If you’d like to know more about the new living benefits in variable annuities, why not talk to a qualified insurance or investment professional today? These new annuity options may give you more financial confidence – and financial choices - for retirement.
Please note that variable annuities are long-term investment vehicles designed for retirement purposes. Investing in variable annuities involves market risk, including possible loss of principal. Investors should carefully consider the product’s investment objectives, risks, limitation, charges, and expenses. The variable annuity prospectus and underlying sub-account prospectus contain this and other important information. These prospectuses should be read carefully before investing.
By: Ishan Goradiya
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