What Are Stock Indexes? (Part II)

By Ahmad Hassam

Modified capitalization weighting involves adjustments to the capitalizations of the various component issues of the Nasdaq-100 index. The NDX contract at the CBOE is based on Nasdaq-100 as is the MNX. The Nasdaq-100 is a modified capitalization weighted index.

Russell 2000 is the well known benchmark for small capitalization sector. Several Russell Indexes have become benchmarks for specific areas of investment management. Frank Russell Company is one of the leading global investment consultants. It is also involved in performance measurement, analysis and investment management.

Russell 3000 Index as the name implies includes 3000 issues and is adjusted for certain factors such as cross holdings and the number of pairs in hands. These 3000 companies represent 98% of the US investable equities.

Russell 3000 is further split into subsets like Russell 1000 Index and it covers the top 1000 companies. It is about 92% of the value of the entire 3,000 stock index. The Russell 2000 Index is the smallest 2000 companies in the Russell 3000 Index. It represents about 8% of the value of Russell 3000.

The Wall Street Journal is probably one of the most perfect business franchises from the business point of view. Dow Jones is the publisher of this journal. The net worth of most of its readers is in seven figures. A franchise that is very hard to duplicate.

Dow Jones Industrial Average (DJIA) comprising 12 smokestack companies made its debut in the year 1896. Over the year DJIA became an important business barometer and grew to encompass 30 large industrial companies.

The DJIA is still one of the worlds best known stock measures. It consists of 30 largest and most liquid blue chip stocks in the US. The average is maintained by the editors of the Wall Street Journal.

The DJIA unlike the S&P 500, Russell 3000 Indexes or the Nasdaq-100 is a price weighted average. The highest price issues hold the most influence over the average. Recently Microsoft (MSFT) and Intel were added to the DJIA.

A 1 percent move in a $90 Microsoft (MSFT) stock would have a greater impact than a 1 percent move in a $30 Intel stock on DJIA as compared on the S&P 500. ETFs exit on many Dow Indexes like the DJIA, the Dow Jones Global Titan Index, the Dow Jones Total Market Index, and various sector indexes.

Wilshire serves over 400 organizations in over 20 countries representing over $2 trillion in assets. Wilshire flagship index is the Wilshire 5000 Total Market Index.

It has increased to 6500 issues over the years representing the increase in the number of companies in the US. It represents the broadest index for the United States equity market.

The Morgan Stanley Capital International (MSCI) database contains nearly 25,000 securities covering 50 countries. One of the advantages of MCSI and its foreign indexes is consistency. It calculates nearly 3,000 indexes daily and services a client base of over 1,200 worldwide. - 23212

About the Author:

Mr. Ahmad Hassam is a Harvard University Graduate. He is interested in day trading stocks and forex. Get good Forex Training. Learn Forex Trading!

Macro Trading the Carry Trade

By Bruce Theil

Macro traders trade virtually everything. They trade stocks, bonds, commodities, and currencies looking for uncorrelated trade ideas with great risk to reward characteristics. Sometimes they will even venture into markets like real estate and even art.

They trade not only different asset classes but multiple strategies within each asset class. For instance in stocks they will trade outright long and short positions, merger arbitrage deals, asset class arbitrage where you trade the equity against debt, and even pairs trading. They do much of the same in commodities and currencies as well. Essentially they are looking for sources of return wherever they can find it.

Macro traders have one strategy that most traders never use and that is the currency markets. Long the playground of only banks, currency trading is now available to the masses and is getting better and better. One of the best strategies in currency trading is that of the carry trade.

The carry trade consists of going long a high yielding currency and going short a low yielding currency to fund the trade. You make money in two ways. One is if the initial trade is profitable if the higher yielding currency goes up relative to the low yielder. The other way to earn money is to make money off the carry, or the interest rate differential.

Using leverage you can really juice your returns in the carry trade. For instance if you are earning a three percent yield from the differential then you can earn thirty by being levered up ten times. If you lever up twenty times you will earn sixty percent. While these gains sound great they do come with great risk. You knew this couldn't be that easy.

Nope, simply put juicing things on the way up will kill you on the way down. If volatility is anything but low you will get killed with excessive leverage. Instead you need a good way to track volatility and measure when is a good and a bad time to be in the carry trade.

There are a gazillion ways to measure volatility but some of the best ones are by using an actual volatility index. We have the VIX on the SP500 which is a surprisingly good measure of financial volatility and is suitable for currencies as well. But these days we have some volatility indexes from many of the investment banks which make it far easier to measure currency volatility and back test ideas.

If you are trading the carry trade then you should be using a volatility filter to greatly improve your results. If you are not trading the carry trade then you are also missing out on some great uncorrelated and relatively easy returns. And finally if you are not macro trading then you are missing out. You should be taking advantage of all the opportunities in the world and not just in stocks. - 23212

About the Author:

If you need actionable trading ideas then check out The Macro Trader It is a weekly global macro trading advisory publication with frequent intra-week updates for time-critical analysis and actionable trading ideas.

Try This Technique For Selling Your House

By Jesse C Davis

One aspect that is very difficult in today's real estate market is finding buyers for your deals or basically selling your house. Financing is tough and many people are just holding on to there money trying to see what is going to happen in this crazy economy.

Once you get online I am sure you will read about or hear about Craigslist.com as a great way to find real estate deals and find buyers for your deals. However if you don't know how to use craigslist properly then you will probably just waste your time.

Many gurus online, disguise their criagslist techniques very well but in reality they are just spamming techniques that really don't work. Craigslist has made me a lot of money in my real estate business and will do the same for you if you do it right.

The only way to use Craigslist to find buyers properly is to take the time to actually read the listings and find the investors that are buying and selling in your area. Make sure to look for investors that are moving houses not just home owners that are trying to sell one house. You should be able to tell the difference by reading the ads.

Also post your deal online on craigslist in everyday. Craigslist has some rules about posting everyday the same ad but if you want to find out how to get around that rule very eaisly and ethically then follow the resource link at the end of the article. Its not very hard to figure out but take it from some one who has sold 65 houses last year it makes a difference. - 23212

About the Author:

For more information on how to use the internet to find cash buyers for your deals and to build a massive monthly income in real estate this year you need to find more information about Jesse Davis in Brandon MS. He knows his stuff.

Cost of Land In Costa Rica

By Randy Berg

Real estate buyers and investors will find Costa Rica a great city for investing in, as the cost of land in Costa Rica is very reasonable. This gives those who are not earning big salaries or are not in the high income group to find an opportunity to get a decent home for themselves. It also makes a great business deal for investors who want to buy and then sell the property to make a reasonably large profit. Of course the profit would depend on where they buy the property, as the more affluent areas will have a better profit while the middle class areas will have a lesser gain.

This city is the most wanted place for people who would like to invest in homes and properties, and to relocate to. The main reason, for this is the low cost of land in Costa Rica, and the possibility of the resale value going up. This ensures high profits for the buyers who can get the property at a cheap rate and sell it later for a good gain. Properties here have been known to get triple the price of what was paid for them, after a period of ten years or so.

There are many reasons why the cost of land in Costa Rica is more affordable than in other places. The cost of living is cheaper here than in other places and the taxes are cheaper here too. This makes life in this town much more comfortable.

Apart from the cost of life, the countryside and the beaches are a major attraction which makes the cost of land in Costa Rica a secondary factor for those who prefer to live here. The benefits amount to much more than what has to be paid for the property here and this is the reason why people are flocking to this town in search of homes.

The pace of life is slower here and it is a safe place for families to live in. Along with this, the cost of land in Costa Rica and the other factors which add to the comfort of living here are an added bonus for people who buy a home here.

In spite of the low and affordable cost of land in Costa Rica, people want to get the best deal where they can save a considerable amount of money on their new properties. This is quite possible if they look around and choose wisely. The right place to get a cheap property, which you know will one day fetch you a great price, is to look at properties which are yet to be fully developed and are still in the initial stages of development.

On the other hand if you want to make sure that your property is one day going to get you a lot more than what you paid for it, look for places which have some major developments happening in the near future. Though the cost of land in Costa Rica may be cheap right now, the surroundings will increase the property value soon. - 23212

About the Author:

Let Randy Berg help you find stunning and wonderful properties at Costa Rica Real Estate. Interact with us through our forum.

The Facts Behind High Yielding Investments

By Mr Christopher Latter

Uncertainty: This would be the exact and the right word to describe today's world. You really can not be certain of any thing these days. Our fortunes, incidents that concern us cannot be predicted. Finances are no exception for uncertainty. The field of finance can be very tricky to predict. So, it makes this more complex and uncertain. You could never be very sure of the stocks which would go up nor about the progress of stock markets. So, even the High Yield investments are same.

While in this uncertainty, people often find themselves in a confused state of where to put their money in order to maximize their investments. There have been several investing areas such as the High Yielding Investments where returns are expected in huge amounts. But there is relatively a low security for the money in these areas. Also there are areas where the security is offered in high amounts whilst the returns are not.

High Yield Investments promise to derive returns in higher amounts more than what the conventional methods derive. While the conventional methods derive their profits from their own way, the non-n conventional high yielding investments derive their profits from real estate flipping, arbitrage, options, futures and FOREX. There is a high scope of tremendous leverage in these areas and hence the high returns. Invest your investments in some High Yielding Programs to multiply your investments over a small period of time.

But unfortunately, the recent records say that there is high rate of scam (as much as 95%) going on in this area. The figure almost shocks the reader as there is no other area that has a higher scam rate than this. It means that out of every twenty high yielding investment programs, 19 programs are scams!! In other words, only one out of every 20 high yielding investment programs is genuine. What most shocks the reader is that few of these high yielding programs do not even exist!!

You might be really confused on security concerns whether to go with high yielding investments or not. The above mentioned statistics would only add up to the confusion. The fact is you cannot ignore them because of fraud in some programs as there are lots of genuine programs that are very worthy to invest. Everything would be dependant on making the right choice.

However, judging the High Yielding Investment as a scam or as a savior is completely based on the personal prospective of the investor. If the investor invests his money in the right high yielding investment scheme, then he can consider it as a 'Savior'. If he invests the same in the wrong hands, then it becomes a 'scam'.

The appeal and popularity for the high yielding investment programs amongst investors has naturally made some people to design false programs. These false programs by using false marketing strategies tend to earn easy money by cheating people. So it is no wonder that 95 percent of the schemes are a scam. There are also certain programs which initially offer good yields to the investors but in the long run would eat up all the investors' money.

You can opt for more secure options if you are satisfied with fewer profits. If you want more profits then you have to go for High Yielding Investments. If you follow the above mentioned tips and carefully select the best and more importantly genuine schemes you would have a chance to gain huge money. Go make your lives better with High Yielding Investments - 23212

About the Author:

Learn more on the subject of drip High Yield Investmentby visiting an archive of articles on this subject and other sources knitted closely to High Yield Investment.