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Be A Green Investor

April 19, 2012 by Jon

Green InvestingBeing a green investor is just one area of social responsibility that has taken hold in recent years.  Corporations have found it easier, if not necessary, to embrace a more environmentally friendly view on business.  Sometimes this comes at the cost to profits, but technology improvements and lower costs have made it a much more practical and stockholder friendly view.

The idea of green investing is pretty simple, you look to invest in companies that are trying to make a positive impact on the environment.  From a consumer standpoint this has been going on for years.  We’ve seen advertising campaigns built solely around a company’s environmental awareness.  Whether a company’s environmental stance is pure marketing or a concerted effort to make a difference, is an argument for another day.  The fact that the environment is part of the business plan is what matters.

What Makes A Company Green?

There are two ways a company can be green.  A company either maintains a green operation or runs a green business.  By a green operation, I mean that the company is trying to carry on its day-to-day operations by using less energy, producing less waste, less carbon emissions, etc.

A green business on the other hand produces products or services that help in the fight against climate change and the destruction of the environment, like solar panels, wind turbines or environmental clean up.  Of course, companies can fall into both categories too.   Continue Reading…

Carnival Of Money Pros: Tax Rush Edition

April 15, 2012 by Jon

Happy Hour: Springfield, Oregon & Project Glass Parodies

April 13, 2012 by Jon

It’s Happy Hour and a perfect time to take a break before you file your tax return.  So sit back, relax and enjoy some recommended reading before you have to rush off to meet the deadline.

Springfield, Oregon?

The cat is out of the bag.  The truth is out in the open.  It only took 23 years to finally reveal what most people stopped caring about years ago.  Matt Groening finally came clean about the true location of Springfield in The Simpsons in an interview with Smithsonian magazine.  My life is now one step closer to complete.

Project Glass Parody

Last week, I mentioned Google’s new Project Glass.  Since it’s release there have been a bunch of funny Youtube parodies that have since been released.  I still think the glasses are cool, but the videos are funnier. Continue Reading…

Greater Fool Theory: Investing For Suckers

April 12, 2012 by Jon

Greater Fool TheoryThere’s a sucker born everyday and that’s the basis for the greater fool theory.  When enough fools jump on an asset bandwagon, it can look like an unstoppable force and a bubble is born.

The greater fool theory was in place and going strong during the internet boom.  It worked wonders until the housing market went bust.  It might even be alive and well in the gold market, with some gold bug holding the bag in the end.  At some point, it will even strike Apple’s stock.

The theory thrives as long as someone, somewhere will pay more.  It works until it doesn’t.  Then it collapses like a giant house of cards.

The Greater Fool Theory

The greater fool theory states that it is possible to make money buying assets only to sell them later for a profit because there will always be someone (a greater fool) willing to pay a higher price. Continue Reading…

Build Your Own (Cheaper) Mutual Fund

April 10, 2012 by Jon

Two of the biggest arguments against mutual funds are high costs and poor performance.  When your mutual fund starts under performing and increasing costs, instead of finding another mutual fund money sink, build your own.

When a mutual fund is started, it’s built around a goal.  Something that easily explains to investors how all that money will be invested.  There’s a hitch, though.  With an active manager you just never know how much they veer off course from that goal.  And when they fail, it only costs you more.  Which is just one of many limitations.

Costs limit your investment performance.  There is no way to cut costs entirely.  So we have to focus on keeping it to a minimum.  This keeps more money invested and growing over the years.

Then there is the performance issues.  Your money has a goal (at least it should have a goal).  So you search through all the possible funds to, hopefully, find a few that sync up with your goal and don’t eat away too much of your profits.

It all works out for a while until the cost and performance of those mutual funds don’t live up to expectations.  So you look for another fund to put your money in and the cycle starts all over, compounding the costs.

Of course, there is another, cheaper option. Continue Reading…

Happy Hour: Earnings Season, Google Glasses & Failed Advisers

April 6, 2012 by Jon

Welcome to Happy Hour and the first week of financial literacy month.  With that I bring you some of the more interesting topics of discussion I came across this week.

First Quarter Earnings Season

The market has had a great first quarter of the year so far.  The S&P 500 is up about 11% for 2012.  That’s a nice annual return for only three months.  It might be ahead of itself as we’ve seen some sell off this week.  But news has been almost nonexistent and I believe too many people are waiting for an unwarranted repeat of last year.

With earnings season kicking off April 10, it’s a good time for a portfolio review.  Listen to the conference calls as the earnings reports are released.  Keep an eye on revised revenue and profit numbers too.  We want to see upward revisions and positive outlooks on the year.  If a majority of the earnings beat analyst expectations we can expect the market to move higher from here.  Don’t be sold by a few good or bad reports early on.  There’s still 9 months left on the year and an election to  mess with the markets.

Google Glasses

It’s like a product of a sci-fi flick, Google announced the testing of Project Glass that allows for hands free mobile.  And phone free mobile too.  You’ll just have to check the video out. Continue Reading…

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