Stocks Down for Third Week Amid Facebook Frenzy - Yahoo Finance Stocks Down for Third Week Amid Facebook Frenzy - Yahoo Finance

Saturday, May 19, 2012

Stocks Down for Third Week Amid Facebook Frenzy - Yahoo Finance

Stocks Down for Third Week Amid Facebook Frenzy - Yahoo Finance

U.S. stocks were lower for the third straight week on Greece and European debt worries while Facebook’s (FB - News) highly anticipated IPO was a disappointment in the first day of trading Friday.

A social media ETF fell sharply on Friday amid the Facebook IPO. [Social Media ETF Down as Facebook Begins Trading]

Stepping back, U.S. stocks continue to move lower on speculation Greece will soon leave the euro. In Friday afternoon trading, the S&P 500 was down 4% for the week, the Dow slipped 3.4% and the Nasdaq Composite shed 4.8%.

Not surprisingly, the top ETF performers in the risk-off trade this week were volatility funds and Treasury bonds. The iShares Barclays 20+ Year Treasury Bond (TLT - News) was set for a 4% weekly advance. [TLT Nears All-Time High as Yields Plunge]

Yields on the 10-year Treasury note are hovering near historic lows, suggesting investors are afraid of deflation and moving into safe havens.

There were also a few standouts in commodity ETFs this week with iPath Grains ETN (JJG) and U.S. Natural Gas (UNG) enjoying gains of more than 6%.

Conversely, other energy-related sector and country ETFs suffered the steepest declines this week. The worst performers included solar energy, uranium, coal, miners, Brazil and Russia.

The top three unleveraged ETFs this week were iPath Grains, PIMCO 25+ Year Zero Coupon Treasury (ZROZ) and U.S. Natural Gas.

The bottom three unleveraged ETFs this week were Guggenheim Solar Energy (TAN), Global X Uranium (URA) and Market Vectors Brazil Small-Cap (BRF) with losses of more than 12%.

In next week’s economic data, look for reports on new and existing home sales, durable goods orders and consumer sentiment.

Purchase home with some financial due diligence - Economic Times
In his mid-thirties , Sridhar is contemplating on buying a house. While the food inflation breached the doubledigit mark recently, the overall inflation shows no sign of taming down. Amidst the reigning financial uncertainties , Sridhar is undecided on taking a home loan to the tune of Rs 50 lakhs. A home loan is a huge financial burden and borrowers must have a safety net in place.

Is your safety net in place?

Optimum loan amount

How should you arrive at the right amount to borrow? The number of dependents, other debts, additional sources of income, expenditure level and interest rates has a direct bearing on the right loan amount.
Lenders know pretty well that borrowers cannot afford to spend more than 40 percent of their gross salary towards a home loan repayment. When estimating the home loan amount, ensure that you take into account additional costs like stamp duty and other legal fees.

Consider a scenario where Sridhar takes a loan to the tune of Rs 40 lakhs. For a tenure of 15 years, at a 10 percent rate of interest , his monthly EMI is Rs 43,000. If Sridhar's loan amount was Rs 60 lakhs, his EMI will be Rs 64,000.

Borrowing less translates to lesser monthly financial commitment towards a home loan.

Factor in rate increase

Floating rate loans can fluctuate in either direction . A drop in the rate will translate into monthly savings . On the contrary, a rate hike can lead to increased financial outgo.

Consider a loan amount of Rs 40 lakhs. For a tenure of 15 years, at a 10 percent rate of interest, Sridhar's monthly EMI is around Rs 43,000. If the interest rate goes to 15 percent, the EMI is Rs 56,000.

If a borrower has to pay the increase in EMIs over the years, they will become difficult to manage without a sound financial plan. Hence, factor in rate increases when calculating your loan repayments.

Build a contingency fund

It is recommended that you have three to six months' salary in your cash reserve. This contingency buffer should be expanded in the event of an increase in outstanding debts, more dependents or greater expenditure .

Failing to build a contingency buffer before taking a home loan could prove to be difficult in the event of an unexpected expenditure.

Have protection plan in place

There are numerous home insurance plans targeted at home loan borrowers . They provide cover to a home loan in the event of any unforeseen event happening to the borrower . In such a situation, the family of the borrower will have the support of the insurance cover to pay for the outstanding home loan, without being burdened by monthly EMIs. Read the terms well before narrowing on a home loan insurance product.

A borrower must aim to be debt-free soon. In the event of a financial windfall , try to repay your outstanding debt towards the home loan. A home is a precious asset to which the family has an emotional attachment . Build a financial safety net so that your home purchase process is without glitches.

Xpress Money may use the UAE as trial market for transaction service -

Saturday, May 19, 2012

Gulf News

Dubai The UAE could be one of two trial markets as the UK-headquartered payment services company Xpress Money makes a move into the individual to business (or business to individual as the case may be) transaction space. Its home market could be the other test market with the trials expected to start post-summer.

“There are very few payments facilitators who are already offering such a service capability and those who are got into it quite recently,” said Sudhesh Giriyan, who heads the regional operations at Xpress Money. “By getting in ourselves at the earliest we expect to narrow any advantage the others may have.

“As of now, we are trying to feel the market out by talking to institutional clients.”

Sources at local remittance houses reckon this is the way forward for the industry. Having institutional clients readily translates into substantial funds flowing through the remittance pipeline and that can only be a good thing for all industry players.

Xpress Money — which came into being in 1999 — only services individual to individual payments, with the UAE — where it has 350 locations operated by various exchange houses — and the GCC being one of its top transactional markets globally. Last year it entered the US and more recently Australia. The plans are to extend coverage to Latin America.

Widely rated

That is why the company wants to get into payment settlements involving individual to business and vice-versa. This category is widely rated within the industry as the next big thing.

Such services could be utilised to make an airline booking, whereby a customer can do the needful at a physical location where the Xpress Money service is available, or for a business to send salary contributions to outstation employees.

“We are formulating the systems and will also require having in place strict compliance practices,” said Giriyan. “Also, future corporate clients would need to be assured that we can provide optimum coverage through physical locations and that’s being addressed. We will also need to maintain bank accounts.

“It’s different to the typical compliance requirements for individual to individual and quite exhaustive.”

Not that remittance volumes involving individuals are showing any signs of slacking off. The estimated volumes last year through the GCC corridor were estimated at $76 billion (Dh278.9 billion). Saudi Arabia alone would account for more than $25 billion, enough to place it among the Top Three worldwide.

“But it’s still the US that is the biggest remittance market by far and the recession does not seem to have had any impact,” said Giriyan. “Last year it was estimated at $51.6 billion and it’s not difficult to see why — the whole of Latin America depends on individual remittances coming out of the US and so are many markets in Asia.

“China, India and Mexico remain the biggest recipients of remittance transactions, which goes to show that customer to customer volumes are not saturated. But customer to business opens up a whole new stream of opportunities.”

By Manoj Nair?Associate Editor

© Gulf News 2012. All rights reserved.

Stocks fall again on Europe woes - Arkansas Online

Biased financial advice is shockingly common, but investors don't take the unbiased stuff - Oregonian
In recent decades, research has shown what Wall Street's known all along: We are hazards to our own financial health.

We overestimate our abilities or chase the hottest trend. We fall prey to inaction, procrastination and information overload. Losses hurt a lot more than gains soothe.

Now, a flurry of research has emerged in the U.S. and Europe looking at whether financial advisers can help us overcome these pitfalls.

The results are not encouraging.

Advisers who get paid for the products they sell tend to harm their clients' portfolios, two studies suggest. These advisers appear to make our biases worse.

Unbiased financial advice exists. But investors who need it most don't seek it, a third study shows. Investors who do rarely follow it. And those who do follow it need the advice the least.

I'm not sure what to say about all this other than it's time we all woke up. Regulators, employers and advisers can do more to protect our savings from biased money managers. But a whole lot of our success hinges on us.

How bad is general financial advice? Fairly bad and widely available, according to a study published in March by the National Bureau of Economic Research.

In the study, researchers from Harvard University and Massachusetts Institute of Technology sent secret shoppers to nearly 300 financial professionals around Boston. These trained financial auditors pretended to seek help improving their retirement portfolios.

Some of the mostly female shoppers told the advisers they wanted to invest in the best-performing funds. Others walked in with one-third of their investments in their own employer's stock, another no-no.

A third group already held a portfolio of well-diversified, low-cost index funds, which research consistently shows to be the best way for average consumers to save for retirement.

The study doesn't reveal where the advisers were employed other than to say banks, retail investment firms and independent shops. Most were paid on commission based on the fees and volumes they generate.

Initially, many advisers praised the shoppers' portfolios, possibly to butter them up. But when they made recommendations, they favored funds with higher fees and commissions. In only 21 cases, about 7.5 percent of the time, did the advisers suggest index funds.

Worse, 85 percent of the shoppers with efficient, low-cost, passively managed investments were discouraged by the adviser from continuing with the strategy. Most were steered into higher-cost, actively managed funds. This was particularly true if the client was wealthy, where the fee income that would be generated for the firm would be higher.

"Our evidence suggests that advisers' self-interest plays an important role in providing advice that is not in the best interests of their clients," the authors wrote, adding that "the market for advice works very imperfectly."

A 2009 study of German advisers found similar results.

Researchers from Goethe University got access to the performance of 37,000 investment accounts at a commercial bank and a brokerage. They compared the results of investors who made their choices with those who relied on advisers.

Advised clients had significantly lower annual returns: 8 percent versus 13 percent for those who invested on their own. They also owned riskier investments. And they traded more often, which generates more income for advisers and their employers but lower overall returns.

"Our findings imply that many financial advisers end up collecting more in fees and commissions than any monetary value they add to the account," the authors wrote.

Surprisingly, those who relied on advisers were more likely to be richer, older, more experienced, self-employed, female investors rather than poorer, younger, inexperienced and male ones.

That led authors to liken these advisers to baby sitters.

Baby sitters, they said, are hired by well-to-do parents to perform a service parents can do better. They charge for it. But a child's achievement is not boosted by baby sitters.

The investors, the authors concluded, were experienced but inattentive and failed to effectively monitor advisers and the outcome of their activities.

It's buyer beware, right? If we'd just seek out financial advisers or planners who take no commissions -- or turn a nanny cam on those who do -- we'd be able to retire early.

Unfortunately, many of us seem both ignorant of these conflicts or eager to peer past them.

Remember those mystery Harvard/MIT shoppers? They expressed willingness to go back, with their own money, to nearly 70 percent of the advisers they visited, researchers found.

And if investors aren't ignoring what they see, they seem tone-deaf to unbiased advice, if they seek it at all.

Don't believe me? Get a load of this study, published in January in Oxford University's The Review of Financial Studies.

Researchers worked with one of Germany's largest brokerages in 2009 to offer 8,200 customers free advice for their self-directed portfolios. A computer program would produce the recommendations, with no commissions or other incentives tied to them.

All, it turns out, could've used some help. The customers' returns, on average, significantly underperformed benchmark indexes.

Still, only 385 customers took advantage of the free offer. Of those, 260 failed to follow the advice. The 125 who did take the advice didn't follow it very closely, and no one followed it perfectly.

And the 385 who accepted the offer were less likely to need advice. They were older, wealthier and more financially sophisticated than those who spurned it.

Had they followed the advice, their investments would have gained nearly 25 percent in the following six months, researchers found. Instead, those who made some changes logged, on average, a 21 percent gain. Those who made none gained 18 percent. Those who didn't participate gained 17 percent.

Perhaps as important, the recommended portfolios would have been much less volatile, or risky. That's a characteristic that gives investors more peace of mind.

When I asked this of the study's lead-author, Utpal Bhattacharya, an associate professor of finance at Indiana University, he spoke bluntly: "I don't know that I can say anything positive."

Bottom line, he said, the government's efforts to regulate biased advisers aren't enough. We need to better educate consumers, too, to rid them of their biases.

Some of Bhattacharya's colleagues in Germany are now researching the best ways to get investors to follow good financial advice.

Let's hope they come up with something.

Until then, it's time we bucked Wall Street and examined our own behavior. What kind of advice are we getting? How do we know it's good? Are we willing to seek out, and pay, for unbiased advice? Will we follow it?

-- Brent Hunsberger welcomes questions about his column or blog. Reach him at 503-221-8359. Follow It's Only Money on Facebook, Google+ or Twitter.

2 Dividend Stocks on Our Radar - Daily Finance

The following video is part of our nationally syndicated Motley Fool Money radio show, with host Chris Hill talkingwith Ron Gross, James Early, and Joe Magyer. In this segment the guys share the stocks on their radar, including companies in the banking, home-improvement, and environmental waste management industries.

For investors seeking dividend-paying stocks trading at bargain prices, check out The Motley Fool's free report "2 Dirt Cheap Stocks With HUGE Dividends." You can be among the first to get analysis of a market leader in payment systems and a high-yielding energy company by accessing this just-released report. Simply click here -- it's free.

iStar Financial's Board of Directors Approves New $20 Million Stock Repurchase Program -
iStar Financial Inc. (NYSE: SFI) announced today that its Board of Directors approved a new stock repurchase program. The program authorizes the Company to repurchase up to $20 million of its common stock from time to time in the open market and privately negotiated transactions. The Company may make purchases through a 10b5-1 trading plan.

 *           *          *

iStar Financial Inc. (NYSE: SFI) is a fully-integrated finance and investment company focused on the commercial real estate industry. The Company provides custom-tailored investment capital to high-end private and corporate owners of real estate and invests directly across a range of real estate sectors. The Company, which is taxed as a real estate investment trust ("REIT"), has invested more than $35 billion over the past two decades. Additional information on iStar Financial is available on the Company's website at

SOURCE iStar Financial Inc.

Financial Times: Ukraine's boycott blues -

Financial Advice for Surviving a Job Loss - PRLog (free press release)
PRLog (Press Release) - May 19, 2012 -
Whether you are laid off indefinitely or your position is terminated altogether, losing your primary source of income can be terrifying. Being proactive from the get-go can help you maintain a more comfortable lifestyle until you replace your lost income. Here are some tips for getting by when the unexpected happens. CLICK HERE Now to Check Out Non Profit Credit Card Consolidation!

Be up-front with your creditors. Contact your lenders to see if you can negotiate lower payments or otherwise alter your payment terms temporarily. If you have student loans, for instance, you can generally put your loans into forbearance or defer them due to financial hardship. Many creditors will require proof that your income has changed, so be prepared to offer documentation.

Give up services that you can live without. While it may be painful to go without Netflix, satellite or cable TV, a lawn service or other luxuries, trimming these unnecessary costs can help you preserve your savings and have more money to put toward necessities. Some suggest giving up your cell phone or home Internet, but if these are your only points of contact for potential job offers, it is probably worth it to keep them connected.

Consider a less expensive form of transportation. If you have a hefty car loan and expensive insurance, downgrading to a used vehicle may be a good idea. Better yet, if you have access to public transportation, consider getting rid of one or more automobiles altogether. CLICK HERE now to check out Non Profit Credit Card Consolidation Now!

Alter your grocery-buying habits. If you tend to shop wherever it is most convenient, you are probably missing out on big savings. Pay attention to circulars to find the best deals on the foods you purchase the most. You can also get more bang for your buck by shopping at discount stores and by buying staples like rice, beans, and flour in bulk. Use your time off to learn some new recipes; cooking from scratch can save you lots of money.

Do not turn to your credit cards unless you truly have no other options. Racking up significant debt, especially for non-essential expenses, will simply make it much harder to catch up when you find a new job or return to your old one. Save these lines of credit for true emergencies, such as car repairs.

Find a way to make extra money, however little. Use the free time you have left after searching for jobs to perform side jobs like lawn mowing, tutoring or giving lessons. Advertise your services in free classifieds, Craigslist or local bulletin boards.

Apply for help from the government. Depending on the circumstances of your job loss, you may qualify for unemployment benefits. Look into your options right away, because in some localities, unemployment doesn't kick in immediately. Also, investigate services like SNAP and WIC, depending on the size and composition of your family. These programs provide debit cards or vouchers for purchasing food.

Unemployment can be a difficult and stressful time for your family. With these tips for making ends meet, however, you can reduce your struggles and stay afloat while searching for your next source of income. CLICK HERE Now to Check Out Non Profit Credit Card Consolidation!

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