January 2009

Zero interest rate era arrives early for TD Waterhouse customers

January 30, 2009

Looks like the age of 0% interest rates has come early for customers of TD Waterhouse in the UK, which just announced the rates pictured for cash held in its various share dealing accounts. Dealing accounts typically offer terrible interest rates on uninvested cash, but 0% is taking the biscuit (or rather all of the [...]

0 comments

Currency risk

January 30, 2009

Currency risk arises from exchange rate moves between pairs of currencies. If you have investments or assets in a foreign country with a different currency, you face currency risk, unless the foreign currency is pegged to your domestic currency or your exposure is hedged.

0 comments

Time value of money: Why locking money away earns a better return

January 29, 2009

Time value reflects how you’d rather get a fixed sum of money now than exactly the same amount of money in the future.

1 comment

Why I’m holding HSBC and Standard Chartered, despite the financial crisis

January 28, 2009

With the price of bank shares being driven by fear, should we avoid them completely? Or if we do want to get specific exposure to banks, which banks look the best? As a private investor, I can only tell you what I’m doing (and remind you an index tracking fund should underpin your portfolio, not [...]

0 comments

How fear is driving bank share prices

January 27, 2009

Source: Digital Look I don’t know what annoys me more: That Barclays Bank shares rose 72% on Monday while I was still finishing off a post suggesting they might be worth a punt, or that I didn’t buy any myself. Oh ‘greedy’ side of the fear-greed investing equation, how we’ve missed you.

1 comment

What causes corporate bond prices to fluctuate?

January 26, 2009

There are three main things that drive changes in a corporate bond’s yield and so its price.

1 comment

The really obvious thing we all forget when borrowing money

January 23, 2009

Have you ever wondered who you’re borrowing money off when you go into debt? If you think you’re being given money by a bank or credit card company, think again. In this post I will explain in one sentence who is really lending you money when you borrow. The rest of the article will explain [...]

18 comments

What are corporate bonds?

January 21, 2009

For private investors, corporate bonds offer the opportunity to buy a fixed income in exchange for an investment of capital.

0 comments

While banking system lurches, politicians bicker over VAT in Government gift shop

January 19, 2009

Honestly, I despair. The day before the UK Government unveils a second banking rescue package worth hundreds of billions of pounds and RBS (once one of the world’s largest banks) falls 67% to become a penny stock, the Conservative party apparatus circulates a press release concerning… Value Added Tax in a Government gift shop.

0 comments

Liquidity explained

January 19, 2009

Liquidity indicates how quickly an asset can be converted into cash. Liquidity is a desirable trait to investors, and so generally the more liquid an asset the lower the return it offers, due to investors bidding up its price.

0 comments

How to invest with the Rothschilds via RIT Capital Partners (RCP)

January 14, 2009

Important: What follows is not a recommendation to buy or sell RIT Capital Partners. I’m just a private investor, storing and sharing notes. Read my disclaimer. Name: RIT Capital Partners Ticker: RCP Listed in: London (FTSE 250) Business: Investment vehicles More info: Digital Look / Google Finance Official site: RIT Capital Partners Some say it’s [...]

3 comments

What are the benefits of corporate bonds?

January 10, 2009

Boring can be profitable, but only if the underlying risk/return case is good. In my personal view, that’s rarely true of corporate bonds.

0 comments

Risk/return: Nothing ventured, nothing gained

January 9, 2009

Some assets are riskier than others, both in terms of the security of the income they generate and the potential for capital loss. Generally, the higher the risks of holding a particular asset, the higher the potential return for the investor.

0 comments

Assets: The building blocks of a portfolio

January 9, 2009

An asset is an item of economic value that can be converted into cash. Assets likely to be held by private investors include: cash in bank deposits, securities (such as shares issued by private companies, and government or corporate bonds), property, insurance policies, foreign currencies, cars, art and antiques. Company assets include plants and machinery, [...]

0 comments

Asset allocation in pyramid form

January 8, 2009

Asset allocation is a cornerstone of sensible long-term investment, but it’s something many private investors struggle to get their heads around. One idea, courtesy of The Oblivious Investor, is to think of it like the food pyramid many of us learned at school. The key thing to understand is you want to have more of [...]

0 comments

Zopa update: Interest rates rise for savers, but bad debt doesn’t

January 7, 2009

Back in March 2008, I asked if rising interest rates at Zopa, the British peer-to-peer lender, were an opportunity for cash-rich savers or an accident waiting to happen: In the A*, 24-month market, I seem to be in the zone with an interest rate of 10.5%, which Zopa estimates will give me 9.5% after bad [...]

2 comments

Seven reasons why you shouldn’t start your own business

January 5, 2009

Looking to gain financial freedom by starting your own business? I’d urge caution. Most well-paid employees are better off sticking with their jobs, spending less than they earn, and investing the difference in the markets over the long-term. Don’t get me wrong: I’m self-employed, and I’d only go back to corporate life as a last [...]

12 comments