Tag: investment

Silent Investors

Posted by WFG – September 1, 2011

Silent investors could be a perfect solution for your new business funding issues. Their aim is like any other investor, and that’s to make money. But it doesn’t always mean they want to be involved in the general running of your company. Finding any investors can be tough, so make sure your elevator pitch is up to scratch and business plan is up to scratch.

How to Find Silent Investors

Finding a silent investor isn’t easy. You won’t be able to pitch your business to someone you can’t find, and here the only options is networking. Speak to people that might have business contacts and make sure you keep them up to date. Persistence is an important part of finding an investor, especially for the silent investor. Read the rest of this article

Video Investment Pitch Online

Posted by WFG – August 24, 2011

One of the newest ways to gain funding for your small business is to try a video investment pitch online. But despite Youtube growing in size every day, not many outlets offer this form of exposure. So why bother with this source of investment pitch?

The Modern World

De Draak

Image courtesy of Hans Pama

On TV there is a program called the Dragons Den, where entrepreneurs pitch their business to investors, and hope to gain funding. It gives them national coverage, and though some ideas are rubbish, others get the money they need and help the company move onto bigger and better things. Read the rest of this article

Making Penny Stock Scams Work For You

Posted by WFG – August 15, 2011

Many people ask the question, what is a penny stock scam? And it’s important to know if you are trading on the penny stock market. The problem is that many people don’t really know if these scams really are scams. There’s a lot of confusion surrounding the tricks played, but there are ways of making them work for you.

Imagine yourself at home and it’s just another day working with penny stocks. The hope is always there that you’ll get a tip or find that perfect company which will make you a small fortune. You think about this every day and it’s almost faded into a dream. Until one day, you could hear the news from a friend, through an e-mail newsletter or by reading it on a forum, the perfect penny stock. Read the rest of this article

Valuation Risk

Posted by Winflow – July 11, 2011

Many investors may not realize that the bulk of their portfolio losses are from valuation issues. Valuation risk is the risk that comes with putting  value on an investment. To minimize valuation risk, when investing, it is important to understand the value of the investment and the sources of the value. As an investor, you want to avoid paying more than an investment is worth.

Are you currently in the process of acquiring a business? Do you need assistance determining if the valuation is suitable? If so, contact the Winflow Financial Group. Our trained consultants offer entrepreneurial services to investors interested in acquiring existing businesses.

Consider the following when determining the valuation risk of an investment:

  • Remember than valuations can contain biases. For example, a self-valuation by a firm is likely to have a more positive spin on the financials so be skeptical when considering the valuation.
  • The valuation process involves making a lot of assumptions about the future of a company. There is no absolute certainty in a valuation.
  • As the market changes, so will a valuation. Valuation is affected by supply and demand meaning it will change as new market information becomes available.
  • Valuations should not be based on investors’ perspective alone.

Small Business Credit Cards and Financing

Posted by WFG – July 5, 2011

When we see the huge corporations, we sometimes forget that they were once a start-up company. Most struggled to get their feet off the ground, and without financing they may never have reached the size they are today. But while many banks refuse financing, why not use small business credit cards?

To begin with, let’s start with the advantages. You can draw out the money you need, when you need it. This stops the massive loans that some small companies take out and the interest you pay. It gives you a set amount that can be spent and might help with keeping control of your financing. You also don’t have any investor, which means you can choose what you spend your money on. To use a credit card for your startup business there are some valuable steps to keep to.

  • Avoiding the blend of company and personal finances. By using small business credit cards, and using it only for your company, it shows you are serious.
  • Using a small business credit card helps with tracking finances and expenditure.
  • Using credit cards professionally will help build your company credit rating. If you need extra funding in the future, a good credit rating may just give you the edge.
  • If you use your credit card well, then there is always the option of rewards. These might not be much, but it may help with flight tickets and business expenses.
  • With many of the business credit cards, you have the option of providing cards for your staff too. Just be sure to monitor spending on separate statements.

The problem is that some people don’t have control over what they spend and make credit card mistakes. They buy things they don’t need, max out the card and then get another one. When starting a small business with a credit card, you’re on your own. With too much debt you may eventually get a bad credit score and put off future investing in your company.

Without the option of future investing you will put your company under pressure. This investment funding will be needed as your business grows and could be the helping hand you need to make the step up from a startup company.

Another problem with using a credit card is the inability to spot fraud. Scams are becoming complex with the introduction of new technology and even the most basic are hard to notice. Be sure to keep an eye on your company credit cards and be aware of fraudulent activity.

If you are good with your money, and pay back debts, then your credit score won’t be dramatically damaged. With credit cards you must be focused on which ones are best for you and company, and keep a control on spending.

For more information on small businesses and start-up companies contact the Winflow Financial Group on 1.800.956.6897.

The Investment Trader

Posted by WFG – June 27, 2011

As we know, the stock market is a complicated area of the finance industry. Not only are there theories on portfolio management, there’s also a countless array of risk factors and company strategies out of your control. But despite risk analysis and portfolio assessments there’s also the issue of emotions and traders following the crowds.

We have all seen the TV programs with one trader that shouts sell, and everyone around them goes crazy. It’s a common mistake for someone to follow a crowd, but we have all down it now and again. Seeing someone buy a chocolate bar, or wearing something you like makes you want to do the same. But where it’s easy to get caught up in this, investors must stick to an individual plan and avoid following those around them. There are moments when the system seems to fall into place, leaving you in a state of bliss. But more often than not you will need to push away the doubts and fears from the influences around you.

Because in reality, everyone trading has a different thought process on how things should work. Each trader will have their own fears and aspirations regarding their own personal investment portfolio. They know how to accomplish the portfolio management and they do it in their own style. So if you believe that your investment will work, maybe get some guidance, but put your plan into action and stick by it.

Canadian Investor Immigration Program

Posted by Winflow – June 24, 2011

Though highly controversial, the Canadian Investor Immigration program can help business people looking to move to Canada. The program began in 1986 and was intended to provide seed money towards Canada’s economy. Unfortunately due to lax regulations and no follow-up, many immigrants have taken advantage of this program and it has become known as a way to pay for Canadian citizenship. For those who do use the program as intended, it is way for business owners or those with management experience to invest in Canada’s economy in exchange for citizenship and the opportunity to work in Canada. To be eligible for the Canadian Investor Immigrant program you must meet the following requirements:

Business Experience Requirements

You should have at least two years experience doing one of the following:

  • Managing a qualifying business and controlling a percentage of the equity in the period beginning five years before the date of your application OR
  • Managing at least five full-time employees per year OR
  • A combination of the experience listed above.

Financial Requirements

  • You must have a net worth of CDN$1.6 million that was legally obtained.
  • You must be willing to make an $800 000 investment that will be returned to you interest-free five years and two months after you make the investment.
  • If you don’t have employment in Canada you must also come up with enough money to support yourself and your family. For details about the amount required, click here.

Other Requirements

If you are an investor looking to immigrate to Canada and need assistance with the process our partner, IVE Immigration Services, can assist you.

Bond Risks

Posted by WFG – June 24, 2011

The common misconception is that bonds are safe. It’s true to say they’re one of the safest investments, but this still doesn’t make them safe. In fact more recently the risks with investing in bonds have become all too clear.

Inflation Risk

As we have discussed in other articles, with a high risk you receive a high return. And as bonds don’t have a high risk; their return is on the low side. This makes them particularly vulnerable to inflation risk. Imagine buying a bond that pays interest of 3%, this is about the safest you can get in the industry. If you hold this bond until maturity and the market doesn’t collapse then you’ll be safe. That is unless inflation rises. If this happens it could rise to 4%, leaving you losing money. You’ll get your money at the end of the investment, but it will be roughly the same amount, and everything you purchase will be more expensive.

Reinvestment Risk

Many bonds are callable, this means that the issuer can back the bond before it matures, and pay off the debt. This is what’s known as reinvestment risk and it happens more when the interest rates fall. Imagine you have a bond that is paying you 4% a year. But the rate drops to 2% and the bond gets called back. If the rate has dropped to 2% the chances are you won’t be finding the 4% safe biond anytime soon.

Risk Return Tradeoff: Which Would You Choose?

Posted by WFG – June 23, 2011

The risk return tradeoff is a never ending argument. Some people will choose to risk their money with investments, while others will keep it in the bank. But isn’t it best to get both sides of the story before picking?

Put yourself in the situation where you have $1000. You have the option of putting this money in the bank, with a 4% interest rate. Or, you could lend me the money instead for a 7% interest. The likelihood is that you’ll choose the bank. They are federally insured, there’s no financial risk and if they go bankrupt you’ll get the money back. You if you choose me the risk is higher because I won’t have any laws connected with the money, but the chances are you will earn more because of the higher interest rates.

But the risk return tradeoff doesn’t only apply to finances. You can also connect it with other areas of our lives. Imagine buying a car. You will take it for a test drive to lower the risk of it breaking and only purchase it if the return exceeds the risk.

It all comes down to your personal decisions when working out the risk return tradeoff. But always be sure to negotiate the right deal for you and get the most if you follow the risk route.

Should I Bother with Investments?

Posted by WFG – June 23, 2011

There are a lot of different people in the world, with very different views on how to deal money. Some prefer to save, while others prefer to spend. But there is a middle ground that some people choose to ignore and this is investing. Most are worried about the potential risks while others are more than happy to leave finances alone, and in the bank.

A wide majority of people ask the question ‘should I bother investing’? And while there are potential risks, they don’t always have to be extreme. Placing your money in a bank will see such minor profits that technically, you just have a place for your money to sit. It’s doubtful that you’ll keep up with inflation and eventually you’ll be losing money.

Start by just researching ways to invest your money. The investment industry isn’t about taking all your savings and investing in a risky project. That might be what the films make it out to be, but you can invest in smaller, less risky ventures. These will make you money for retirement and you won’t have to be always keeping an eye on the market.

The simple answer to the question is yes. You should definitely look into investments and research the market. But only do this when you’re ready and understand the potential risks. For more information on investments contact the Winflow Financial Group.