Gold As a Strategic Inflation Hedge

Gold As a Strategic Inflation Hedge

Whenever the economic situation turns uncertain and people are worried about their equity and currency investments, they turn to gold for hedging their risk. Gold is not just a metal but also a very important financial commodity. Gold is something that remains under the ownership of the investor, and the value of gold is also rarely likely to decline in case of economic recession.

Ever since the price of gold hit a record of three decades, the belief of people about gold being the perfect inflation hedge has strengthened even more. While currency is subject to inflation, gold is not. With the increasing significance of gold as an investment commodity, it is not only the people who are investing in it, but also countries and companies.

LaTely, the Chinese government has been putting parts of the trade surplus into gold. This has not only increased the demand of gold worldwide, but the value of gold has also surged. Basically, people are buying gold as a hedge against economic crisis because they are aware of the fact that during the time of crisis, the price of gold rises, hence offering a reasonable amount of return.

The primary reason for the production of gold is accumulation. This is what makes the metal very important in terms of value and return on investment. We all know that money is printed keeping the gold reserves in view and hence, gold is money. It is a perfect store of value, and the more the level of acceptance and use and demand of gold, the higher the value of gold is likely to go.

Gold tends to be the perfect investment and inflation hedge. While all other commodities are going to impact you negatively because of inflation, value of gold will actually rise, it increasing your chances of getting a high return.

It is evident that anyone who possesses investments in gold is likely to have more power and is likely to reap the benefit in the form of high returns. This is because investments in equity and other commodities are likely to loose their value considering in time of a liquidity crisis or any other kind of economic crisis.

Gold is an attractive investment because it is not subject to any particular laws like other investments in the stock market, currency or commodities, which are strictly regulated. For those people who have investments in other financial instruments and commodities, gold can act as the perfect diversifier for the investment portfolio. The basic purpose of the diversification of an investment portfolio is to invest in different kinds of instruments in order to reduce the risk, so that the return does not become negative in case of a crisis.

Gold is considered an asset by the holders because it remains to be the most strategic store of value. This is mainly because gold would always maintain its intrinsic value, which significantly increases the benefit of the investors and enables them to capitalize on the effects of inflamation on gold.

Money and the Laws of Value

Money and the Laws of Value

One summer day a hen was on the look out for food on a farmyard. As she scratched at the straw on the ground, she unwrapped a diamond jewel. The hen suspect that the jewel might be valuable because of the way it glittered in the sun.

This object is probably worth a lot, the hen thought to herself, but I will trade a bushel of this diamond for a single bushel of corn. (One bushel of diamond is worth about 20 million tons of corn)

What is true for the hen is also true for human beings. People can not use money better than their level of appreciation of its power. If you are primarily a consumer you will only be familiar with the consumption power of money - what money can buy. An investor is very familiar with the reproducible power of money - How money can multiply. A business man is familiar with the production power of money - How money change forms into valuable products and services. Money has no power in itself to change your financial personality; it however has the power to magnify your financial nature.

Money as a Store of Energy

Money is a store of economic energy. Without the awareness, acquisition, organization, and perfection of these internal values ​​in any man, wealth creation in a sustainable manner is impossible. Poor resulting from lack of cash or tangible assets is temporary and easily curable; however, poverty resulting from lack of discovery or awareness of these internal sources of wealth is permanent and can not be cured by the acquisition or possession of money or tangible assets . Attempting to cure malaria by the use of pain relieving tablets is at best a temporary solution. Unfortunately, most people looking for money usually neglect and disrespect their internal primary source of wealth. According to Mark Victor Hansen "You do not have wealth, you are your wealth" ! The earlier you come to the full realization of this universal principle, the quicker you will be on your journey to financial success.

External sources of values ​​are those invisible assets outside a person that is reliably fixed and is accessible to every man equally. These include: Time, Problems, and Relationships. Everyman has equal access to these three variables; and they are unavoidable raw materials for the creation of every form of tangible wealth.

Money Creation Process

Three variables therefore determine the quantity of money a person can legally create over a given period of time: The number of internal sources of wealth discovered and properly harnessed; Amount of external sources of values ​​efficiently utilized; and how much of the outputs of the combination of those variables that is successfully delivered to those who need them in exchange for money. For instance, the income that an employee will extremely earn will be determined by how much of his talents, passions, and skills he is able to discover, improve, and convert to expertise. Combined with how well he is able to manage the time, opportunities, and relationships available in his work to generate and deliver the expected results consistently over a period of time.

Laws of Value

Since we now understand that, value is the source of money; and that money can not exist alone without corresponding value; understanding the principles and laws of value will enable us create and sustain money in a legal and enduring manner.

# 1 - Law of Value Flow

" In every human relationship or interaction value is always flowing but money may not"

Since value is an invisible carrier of money, you may be gaining or losing money without you being consciously aware of it. Every time you come in contact with or spend some time with people, you will either increase or decrease your cumulative value if or not money exchanged hands during such interaction. That means if you are in a high paying job, but spend a lot of time with people with poverty mind set or low expectation individuals; your net cumulative value will gradually reduce to reflect your dominant mind set. This will naturally reduce your productivity on your job resulting in stagnation or ultimate downsizing! Conversely, if every time you have a meeting with a prospect he comes out feeling he has added more value than he has during the interaction; he'll seek more opportunities to receive such values, on a more frequent basis - which means the consummation of a business relationship and the signing of contract!

On a daily or weekly basis, if your interaction or association is more with those who drain value from you without offering equivalent or more value in return, you will eventually become money poor.

# 2 - Law of Multiple State of Value

"Value like water has three states, as long as value keeps flowing, under the right circumstance and conditions, it will freeze to tangible money"

Many people get discouraged when they begin to offer value and they do not immediately receive the money equivalent of such values. Such frustration often leads to compromise, mediocrity in service delivery, untimely resignation, and quitting from entrepreneurial venture. But, think about it this way, it takes time for water to become ice in a deep freezer even under the consistent application of electrical power. Even when you are delivering value consistently, it takes some time for the value to be appreciated and recognized for its money worth by other people.

Most of the world's leading successful people have gone through times when the values ​​they offered were not immediately rewarded with money. Zig Ziglar in his autobiography stated that his first 3,000 speeches were given for free. Anthony Robbins - the restructured author and personal achievement expert said that "in his first six months as motivational speaker, all his statements were given free, and he had an average of 5 speaking engagement every day".

# 3 - Law of Value Exchange

"Value must be greater than or equal to price"

Think about the last time you paid $ 20 for your transportation fare. Was it because you liked the driver of the vehicle? Or because you believed that trekking the same distance will have more adverse effect on your health and finance. Human Beings are naturally selfish. They will not willingly give out an amount of money unless they have convinced them that the product or service will deliver to them more value than the price they want to pay for it.

Marketing is there an honorable service of helping people enjoy more value than the price they pay for the product or service that solves a particular problem in their life or business. A marketer is not a money taker; he is a value giver and a solution provider. Many technically sound people shy away from marketing their products with zeal because of psychological guilt fueled by ignorance of the law of value exchange. Not selling your product denies someone from enjoying the benefits it offers and slows down the growth of the nation's economy.

The History of Money Revealed

The History of Money Revealed

Throughout history a many variation of things have been money. Before the invention things like livestock, rocks, shells, beads and metals like gold and silver were all forms of money. In fact, in ancient time's people physical exported goods directly for other physical goods. For example, if I have fish but needed coconuts and in turn you had coconuts but needed fish, then there would be a mutual agreement between us and a transaction could be made. This way of carrying out exchange was known as the barter system.

The barter system however, brought with it some challenges such as double co-incidence of wants. What if we both needed coconuts? Also, there was no common measure of value and no medium to measure the value of goods so who decides if your coconuts are actually more valuable than my fish?

Commodity money was then created to address this concern. A commodity is a basic item which can be used by almost, if not, everyone. Things like seeds, tobacco, tea, salt and even cattle were considered commodities however, carrying bags of these items over a period of time proved to be extremely difficult ... especially trying to carry cattle! There were three main functions to money in these days: money must be a medium of exchange, a unit of account and, a store of value. Although these commodities were considered to be mediums of exchange it was difficult to consider them units of account and given that these commodities were also perishable items they could never really be considered to be a store of value either.

Then came the introduction of coins and paper money. However, according to Wikipedia 'due to the complexities of ancient history and because of the fact that the true origins of economic systems actually precedes written history, it is impossible to trace the true origin of the invention of money'. That-said, metal objects were introduced as money because metal was readily available, appeared easy to work with and, was recyclable. Countries around the world were mingling their own series of coins with specific values ​​making it easier to compare the cost of various items. Some of the earliest known paper money dates back to ancient China, where the issuing of paper money became common from about AD 960 onward.

Paper money began, what we would call in today's generation, trending. Nations around the world today all use paper money. Through the evolution of paper money has come a long list of functions from the previous three. Money must continue to be a medium of exchange and a unit of account however, it must also be portable, durable, divisible, and fungible, which means the dollar in your pocket is worth the same value as the dollar in my pocket. Money has always maintained that it is a store of value however, this is where things begin to turn a bit gray.

Why?

Consider that $ 100 US dollars from just a decade or two ago purchased a lot more goods and services than it would today. The same is true for the euro, the pound, and the yuan. All around the world the money of many nations are suffering what is known as depreciation meaning year after year our money is buying less and less. How then can we maintain that paper money is a store of value?

People all over the world today seem to be working harder for money that is continuing buying less. So, just like the barter system could not be maintained as a viable way of trade, the current system we use on a global scale has also become a broken one. In all parts of the world we have one major inherent problem and that is that our money does not retain its value.

There are ways to solve this problem just as our civilization found ways to solve the barter and commodity system. Take the time now to educate yourself on how.

Option Trading Basics

Option Trading Basics

Options trading can increase the profits you make when trading Stocks if you understand how to use them and know what you are doing. Options can be a very useful tool that the average investor can use to enhance their returns.

This article - Options Trading Basics, looks at what options are and discusses some of the options trading strategies traders can use with these versatile instruments.

Options - An Overview

Options give the buyer the right, but not the obligation, to buy (a call option) or sell (a put option) the underlying Stock or futures contract at a specified price up until a specified date.

In other words, options are like tradable insurance contracts.

An investor can purchase a Put option as insurance against a decline in the Stock price or a Call option in case the Stock rises. Buying an option gives the purchaser time to decide whether they will buy or sell the underlying Stock. The price is locked in until the expiration date, which in the case of LEAPS can be years into the future.

Options trading has several advantages that every Stock Market investor should be aware of, such as high leverage, lower overall risk than owning the physical security, more versatility and the ability to generate extra income from a current Stock portfolio.

An option of value fluctuates in direct relationship to the underlying security. The price of the option is only a fraction of the price of the security and therefore provides higher leakage and lower risk - the most an option buyer can lose is the premium, or deposit, they paid on entering into the contract.

By purchasing the undering Stock of Futures contract itself, a much larger loss is possible if the price moves against the buyers position.

An option is described by its symbol, whether it's a put or a call, an expiration month and a strike price.

A Call option is a bullish contract, giving the buyer the right, but not the obligation, to buy the underlying security at a certain price on or before a certain date.

A Put option is a bearish contract, giving the buyer the right, but not the obligation, to sell the underlying security at a certain price on or before a certain date.

The expiration month is the month the option contract expires.

The strike price is the price that the buyer can either buy call) or sell (put) the underlying security by the expiration date.

The premium is the price that is paid for the option.

The intrinsic value is the difference between the current price of the underlying security and the strike price of the option.

The time value is the difference between current premium of the option and the intrinsic value. The time value is also influenced by the volatility of the underlying security.

Up to 90% of all out of the money options expire worthless and their time value primarily Declines until their expiration date.

This clue offers traders a very good hint as to which side of an options contract they should be on ... professional options traders who make consistent profits usually sell far more options than they buy.

The option contracts that they do buy are usually only to hedge their physical Stock Portfolios - that this is a powerful distinction between the punters and small traders who consistently buy low priced, out of the money and close to expire puts and calls, hoping for a big payoff (illegally) and the guys who really make the money out of the options market every month, by consistently selling these options to them - please read the rest of this article.

The seller of the option contract is obliged to satisfy the contract if the buyer decides to exercise the option.

Therefore, if he has sold Copped Call options over his Shares, and the Stock price is above the option strike price at expiration, the option is said to be in-the money, and the seller must sell his shares to the option buyer at the strike price if he is exercised.

Sometimes an in-the-money option will not be exercised, but it is very rare. The option seller (or writer) has to be prepared to sell the Stock at the strike price if exercised.

He can always buy back the option prior to expiration if he chooses to and write one at a higher strike price if the stock price has rallied, but this results in a capital loss as he will usually have to pay more to buy the option back than the premium he received when he originally sold it.

Many option writers simply get exercised out of the Stock and then immediately re-buy more of the same or another stock and simply write more call options against them.

The buyer of an option has no obligations at all - either either sells his option later at a profit or a loss, or exercises it if the stock price is in-the-money at expiry and he can make a profit.

The vast majority of options are held until expiration and simply decay in price until there is no point in the hapless buyer selling them. Very few options are actually exercised by the buyer. The vast major expend worthless.

Having said all this, lets look at an example of how to use options to gain leverage to a Stock price movement when the trend does go in our favor ...

For this example we will use MSFT as the underlying security. Let's assum MSFT is trading for $ 24.50 a share and it is early January. We are bullish on this Stock and based on our technical analysis we think that it will go to $ 27.50 within two months.

In this example, we will ignore Brokerage costs, but they do have an effect on the percentage returns. The prices and price moves of the Stock and the options are hypothetical - they are intended as a guide only.

Buying 1000 physical shares will cost $ 24,500 and if we sell our position at $ 27.50 a share, we will make a profit of $ 3,000 or a 12% return on our capital. We will have $ 24,500 at risk if we take this position for a potential of 12% or $ 3,000 profit.

Instead of using cash to buy the physical Stock, we can buy 10 call options with an expiration that is at least three months into the future and a strike price that is close to current price of the underlying security.

10 contracts represent 1000 shares of the stock, a call option is bullish, three months until expire gives us some time for a quick move, and buying an option with a strike price that is close to the current price of MSFT allows us to get the full potential of the intrinsic value.

We buy 10 MSFT $ 22.50 April Call options. These options are currently selling for $ 2.80 and they are in the money.

$ 24.50 (the current price of the Stock) minus $ 22.50 (the strike price) is $ 2.00, which is our Intrinsic value. $ 2.80 (the option premium) minus $ 2.00 (the Intrinsic value) gives us $ 0.80, which is the Time value.

If the price rallies to $ 27.50, as we believe it will, the intrinsic value of these same options at that point will be $ 5.00 ($ 27.50 - $ 22.50). That means that if the Stock gets to $ 27.50 a share, our option premium would be at least $ 5.00 plus a small amount of time value, depending on the remaining time until expiration.

Ten option contracts will cost us $ 2,800 ($ 280 times 100) and if MSFT goes to $ 27,500, we could sell our option contracts for at least $ 5,000 ($ 500 by 10 contracts), maybe more.

We will have $ 2,800 at risk if we take this position, rather than the full price of the Stock ($ 24,500) for a potential of 80% or $ 2,200 profit, plus whatever time value is left in the option, probably another $ 100.

Our options buying strategy cave us a much larger percentage profit with a much smaller potential risk. Do not forget that, for us as the buyer, these options will expire worthless if not sold or exercised by the expiration date.

The option seller or writer simply has to sit back and wait until expiry to see if he is going to be exercised. If the Stock price is below the strike price at expiration, it keeps the premium and can write another option over the same Stock.

If the Stock price is above the strike price, he will most likely be exercised and will have to sell his shares if he does not exit the position by buying his options back on the open market (quite often at a higher price than he originally sold them for).

The downside of buying the option over the physical Stock is that if you bought the Stock itself, even if the price had not moved, you would still own it, but by buying the option, if the price does not move in the desired direction , you lose part of your trading capital.

To make options trading work, the undering security must move fairly quickly in the direction you expect, or you will lose money at an ever increasing rate as the expiration date draws nearer.

As you can see, options strategies can offer much higher percentage returns with less risk for the same trade. The majority of your cash is still safely in your trading account rather than being exposed to the market.

This is just one example of using options trading to increase your Stock Market returns. There are many more strategies and ways to use options and I encourage you to explore them further.

All options expire worthless if they are not in-the-money at expiration, so the buyer must close out or exercise his position on or before the expiration date or he will lose the entire premium.

The time value portion of the option premium decreases periodically until expiration date. The closer to expire, the faster the time value decreases, as there is less time for the option to move in the desired direction for the buyer.

For buyers, top traders advise never to hold an option with less than 30 days to expire due to the exponential rise in time decay during this period.

For sellers, it is usually most profitable to write options that have 30 days or less to expire, due to this same time dece effect ... the buyer of these options has the odds stacked against them and will require a large price movement in his desired direction to make a profit - remember, the vast majority of options expire worthless - so this is the side of these instruments the wealthually find themselves on - just a thought ...

There are many other intricacies of options trading that investors and traders should be aware of. This article is only an introduction to options trading and there is a lot more information for you to learn.

For a more in-depth look at the various Options strategies available, visit AcornTrader.com.

This page has a series of articles on options trading and outlines some of the strategies merchants can use to profit from these extremely flexible vehicles.

We encourage you to study these instruments carefully if you decide to trade them. Then use the trend trading strategies outlined in these stories and articles to position yourself on the right side of the market - whether as a buyer or a seller.

To Your Trading Success,

Parking Sensors - 5 Information Tips

Parking Sensors - 5 Information Tips

Parking sensors are becoming more commonly fitted to vehicles, but how do they work? Can a car's design affect installation and will they look factory fitted?

How Do Parking Sensors Work?

As the car reverses into space and moves closer to objects, an audible buzzer beeps more frequently.

This is usually achieved by four ultrasonic parking sensors fitted into the bumper of the car. They send out an ultrasonic wave, and if this hits an object, it bounces back to the same sensor. Information received is then relayed to the brain, allowing it to make the buzzer sounds.

Will Bumper Design Dictate Installation?

For most vehicles the shape of the car will determine where sensors are fitted. This is due to wide differences in design, between manufacturers and models of vehicles.

For cars with a center panel and separate corner bumper pieces that curve around the car, two low and two higher sensors are often necessary. If a vehicle has a metal panel behind the bumper, this usually means holes must rise above the obstruction, also avoiding interference issues.

What are the Differences Between Factory and Retrofit Fit?

Factory fitted parking sensors are the ones fitted to a car at the time of manufacture. Retrofit, often called 'After-market', are the ones fitted at some time after the vehicle was produced.

Factory fitted sensors have a certain look, devised by the car designer, which is difficult to recreate in aftermarket sensors. Retrofit devices are made for all cars from all manufacturers, and clearly have their own distinct look.

It could be argued that some of the latest aftermarket designs are better due to their small, discreet shape. They are also constantly being redesigned for better looks or usage, and not devised and forgotten like factory ones.

What Size?

Sensor heads are getting smaller. Small is definitely less intrusive although they may have limited color options, for example only available in black or silver.

Usually it is best to go for the smallest sensor heads possible, as once a hole is drilled it can not be made smaller.

Do I Need Front Parking Sensors?

Factory fitted front parking sensors are integrated into the vehicle's ECU. They will automatically switch on, and instinctively sense if you begin a parking manoeuvre. Aftermarket versions, with the same functionality, can be expensive and are not available for all vehicle models.

A realistic option for front sensors is to use a switch. This avoids the system becoming active when moving slowly, for example in a traffic jam, but means the driver switches on the system before beginning to park.

It is also worth knowing that generally drivers can see the front of their cars. This means that while rear parking sensors are a significant help when parking, the gains from front ones are limited.

Top 10 Online Freelancing Marketplaces

Top 10 Online Freelancing Marketplaces

I am working as a professional internet marketer in various online freelancing marketplaces from the last seven years. When I initially started the online freelancing career, I depended on one marketplace for all of my work. I earned enough money to conduct my career smoothly. When I started working other sites, I was able to get significantly higher paying freelancing jobs from there. So, today I would like to share my view and top ten awesome online freelancing marketplaces among the hundreds of freelancing marketplaces.

1) UpWork

UpWork.com is one of the awesome online freelancing marketplaces. This site is the combination of two of the most popular marketplaces oDesk and Elance. Here a freelancer can find out almost all kinds of online jobs. There are two kinds of jobs. One is hourly and another is a fixed price job.

2) Freelancer

Freelancer.com is another popular online freelancing marketplace. Here a freelancer can get data entry work to high level programming projects. There are thousands of clients and freelancers around the world. A new freelancer can easily get their desired jobs from here.

3) Fiverr

According to my view, Fiverr.com is one of the most popular online freelancing marketplaces. Here a freelancer need to post a gig with all clear instructions that what can he or she provide. If the client like this, then they can start ordering with five dollars. So the client can easily get quality work in cheap price. For this reason this site is becoming more and more popular day by day.

4) PeoplePerHour

PeoplePerHour.com is a great platform, focusing on freelancing for web projects. If you're an article writer, digital marketer, graphic designer, web developer, SEO specialist, or anything you love to work with your specialty then. PeoplePerHour is definitely worth checking out. Here you have to post hourly and clients will buy this and pay you according to your set price.

5) 99designs

This is a platform for freelance designers, 99designs.com lets you compete in design contests and get feedback as clients choose the best ones with a great payment. It's a great way for talented designers to prove their talents and earn handsome money.

6) iWriter

iWritter.com is the best online freelancing marketplace for content writer. This is the fastest, easiest and most reliable way to get content for your website. A freelancer also can earn almost 15 dollars for each quality article.

7) Freelance Writing Gigs

This is another popular freelancing marketplace for freelance writers, editors, bloggers, publishers or any combination of those. This is a great option for freelancers who have a way with words.

8) Toptal

Toptal.com is also one of the most popular freelancing marketplaces for a custom software development project. Here if a client wants to get a custom software development service, then they can get it from a highly skilled and professional freelancer.

9) Project4hire

With hundreds of project categories, Project4hire.com makes it easy to identify jobs that suit your skill set, without scanning through large volumes of posts. It's great for writers, coders, consultants, designers, programmers and more.

10) iFreelance

iFreelance.com platform accommodates some of the usual suspects of the freelancing world. Here you will get proofreading, arts, data entry, graphic designing, photography, bookkeeping and all types of professional task. But this site is not free for freelancers. There will be a membership fee required for it.

So, you can choose one of these online freelance marketplaces to start your freelancing career or to get your job done fast. Here you will get all sorts of talented freelancers and clients around the word. So what are you waiting for? Start your smart career with these.

Different Ways of Making Money Online

Different Ways of Making Money Online

Computer technology is no longer limited to IT and computer professionals. Some people are working online full-time and are making their living out of the Internet. You have the liberty to work from your home and there is every possibility that you will make more money than you make from your day job. People do want to make money online but are afraid of all the scams on the Internet.

Patience and determination is the key to success on the Internet. Those who fail or do not earn anything online are the ones who want to get rich overnight. There is no shortcut to success online like anywhere else in the world. You can sell your skills online or can become a guru and can teach people what you know. There is a possibility to sell almost anything on the Internet. Your tiniest of skills can make you hundreds of dollars in no time.

You need to have something that you can sell to make money online. You need to create products and market them on various platforms. Creating products is not easy for beginners but it does not mean they can not work online. Affiliate marketing is good for both beginners and experienced people working online. You promote products of other people and take your commission in this type of marketing.

You can utilize the power of social media and can make money out of it. People are making thousands of dollars out of Facebook and YouTube using their creative ideas. You can sell your products directly on Facebook or can direct traffic to your websites and sales pages and can sell to your fans.

Blogging is also a very good option for beginners as it can start paying you back within a few months. If your blog has rich content and is full of information then it will certainly get people's attention. You can sell your ad spaces and can earn through Google AdSense. A lot of bloggers use their blogs for affiliate marketing and make money online.

Freelance websites are also a good option for beginners looking to make money online instantly. All these options can be exercised and they are legit as well. Freelance websites have escrow systems in place so chances of scams are very low on them. Find out your potential and see what option is best for you and start making money online today.