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Wednesday, 5 August 04:23 (GMT -05:00)



Foreign exchange market

Investment Funds: Burden or Reliable Protection from Inflation?


News of investment companies. A lot of investors care about safe and effective maintenance and growth of their savings. Opportunities provided by investment funds are absolutely limitless and bear certain risks. So, what investment funds are and what do investors find attractive about such kind of investment?

What makes investment funds attractive to investors?

Let us clarify the definition of investment in global practice. Investment is the action of placing one’s monetary funds into any possible assets with the aim of getting additional return. Objects for investments and potential sources of income include money (currency, deposits, and certificates), corporate shares, investment companies (collective investments), bonds, real property and land, precious metals: gold, silver, and other goods.

Transactions with the abovementioned categories of investments require considerable sums, experience, and knowledge. If you are an active, experienced trader or businessman, this article is not for you.

We are appealing to people that have their main occupation, gain regular profit from it, and are going to regularly invest a part of it. The “golden rule” of investment and advice from the wise says “keep 10% of earned money for yourself.” Money, shares, and investment funds seem to be the most attractive and the easiest to access.

Should one allocate significant funds to bank deposits, UITs?

Inflation – money’s enemy No. 1. Ukraine is among the countries with developing economies, which means that it is unprotected from inflation. Excess inflation requires excess return from investment in order to maintain initial funds. Money placed under a matrass bears no protection either from inflation, or from physical loss. Consequently, keeping money under a matrass is meaningless. Therefore, investment is the only way out. The first thing that comes to one’s mind is a bank deposit. It certainly is better, but far from ideal:
traditional banking rates hardly cover inflation. Below follows a chart of dynamics of consumer inflation index in Ukraine during 2000-2011; to compare, there also is a chart of dynamics of Ukrainian banks annual rates. One should keep in mind, though, that inflation rate is provided on the basis of information from the Ministry of Finance of Ukraine. For example, many experts suppose the official inflation rate of 4.6% in 2011 is fiction. In their opinion, this number is to be multiplied 5 times in order to receive true dynamics of consumer prices in the country. This is the first reason why it is not worth placing one’s savings in banks.

commercial banks go bankrupt more frequently than investment funds (ICI) or UITs. Let us give certain examples. In 2010 in Russia 53 banks were deprived of licenses. In 2011 the banking Mecca Switzerland faced similar problems. A number of large banks that were unable to stand European financial crisis had to be urgently saved. The same year 92 American and 21 Ukrainian banks went bankrupt. Isn’t it worth taking a thought?

It appears that the risk is high, and the profit is small. Let us now turn to collective investment. Return here is usually higher, but the result is less predictable. Below follows a return rating of fifteen Ukrainian investment funds during 2011. In this reference, international company Manors Investment is at the top of the rating with the result of 93.6% per annum. As you can see, 12.65% profit per annum is the maximal achievement of traditional UITs. There also are structures that have shown negative return, which means that their clients’ assets have reduced.

Return rating of 15 Ukrainian investment funds

Clients of Manors Investment have earned the average profit of 43% during 2011. Their deposit of $1000 at the beginning of the year has turned into $1431 by the end of it. Moreover, the most conservative deposit of Manors Investment “Classical” managed to generate the profit of 6.52% for its clients during the first two months of 2012: 3.17% from deposit in January and 3.35% – in February.
return. In 2010 the average return of traditional investment funds slightly exceeded official inflation rate and amounted to plus12.7% for open ICIs, plus 14.8% for interval ICIs, and plus 32.5% for closed non-venture ones. This data is provided in the report of Ukrainian Association of Investment Business (UAIB). Manors Investment traders and management have provided the profit of 42% to investors, and of 84% to the Company itself.
According to official data, the average return from collective investments during 2009 has amounted to 21.26%. Let us remind that this was the period of fantastic recovery of price of all assets, which followed a decline during the second half of 2008. This year American stock index S&P has raised almost by 37%, and the increase of domestic stock market has amounted to over 90% (PFTS index). The result of Manors Investment proved most modest – 17.1% of profit to its clients. It is worth mentioning that this was a starting year for the company’s project, for it was moving along unbeaten track. 2008 was characterized by negative return of UITs, which amounted to 30.6%.

This is not surprising, taking into consideration market crash and limited maneuvering of traditional investment funds. Consequently, activity of directors and risk managers of ICI certainly needs improvement. In this reference, it is worth mentioning that management of your capital in UIT has not been cancelled, no matter what the result of its activity is. In other words, there is no certainty at low return.

It is not a secret that for Ukrainian traders and investors the process of entering foreign markets is closely connected with difficulties due to legislation. As a result, illegal or semi-legal means are widely used, with all consequences. Ukrainian legislation provides too little opportunities for traditional UITs to be able to generate high and steady return. In such circumstances Manors Investment seems to be a good alternative.

Manors Investment company is very young, as it has been functioning for 3 years only, but has already reached impressive results. The company was founded in 2007. The project used to be called investment and educational club “Perspective” that taught and provided an opportunity to do new and rather unusual for that time business – trade at stock exchange. Its participants fancied the activity of the club and by the end of 2008 the client’s base was several times larger. In general, the ball was set rolling.

Manors Investment: What are the benefits of trust management?

The principle of PAMM-account (Percentage Allocation Management Module) served the basis for the club’s activity and later for Manors Investment company. Consequently, a certain form of collective investment and trust management is involved. Investments are effected on the basis of broker company ManorsGroupBroker. Therefore, Manors Investment is an alternative to investment funds and UITs. It is even more than alternative, for it is an totally new principle that brings totally different profit. Let us remind that last year’s return of Manors Investment proved to be 7 times higher than the one of most profitable ICI Raiffeisen Bank Aval (second position in the rating).

As informed by Representative of Manors Investment Vladimir Yakubovskiy, the company’s investors are provided with an opportunity to insure their investment from loss, which guarantees certain profit despite the operation results of separate traders. In other words, investors may not have negative return. This is guaranteed by the company’s.

Vladimir Yakubovskiy explained that Manors Investment has formed a range of deposits, which is aimed at different categories of investors, different appetite for profit, and different risk management. For example, there is “Classical” deposit, which is characterized by 100% warranty of safeguard of assets. In such a case, traders take the risk of losing only their funds at the account. Such option is appealing to conservative clients. “Dynamic” deposit is the opposite; it is characterized by high return, but there are risk limitations.

In this reference, as stated by Vladimir Yakubovskiy, high profit of the company as a whole enables it to perform its obligations before clients even if one trader or another has had an unsuccessful trading period. 6 months is the minimal lead time on investment; however traders may take their profit every month without any penalty.

According to Manors Investment, such variety of offers enables clients to create their own diversified deposit portfolio, which will include highly-profitable and conservative investment tools.

“Market Leader” Magazine and Masterforex-V Trading Academy hold a questionnaire at forex forum for traders and investors: Can investment funds be considered the best alternative to banks?
- no, bank deposit is safer;
- yes, investing in investment funds are better;
- it is better to keep money at home.

 

You are free to discuss this article here:   forum for traders and investors

 

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Forex-Market Claim They Can Overcome Any Challenges in Financial Markets

The global economy keeps on seeing more and more shocks and challenges from time to time. In early 2015, it became clear that even the notorious Swiss banks cannot guarantee 100% security and safety of funds, not to mention plain FX brokers, which are constantly in jeopardy of going bankrupt. Does it mean it is better to cancel all FX trading and put the money under the mattress? No, it doesn’t! This is what the representatives of a young but promising FX broker named Forex-Market think about it.

 
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Masterforex-V EXPO Names Best FX Brokers For Rookies. July 2015

 

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History always gyrates, which means there will always be ups and downs, clear trends and periods of standstill. For all FX traders out there, it is all about timing. In other words, it is important to join and leave the trend just in time.

A company’s name reflects its aspirations and prospects. That is why they founders called their company Forex Trend. The company’s history over the last 5 years is a crying example of a classic Forex trend with momentums and retracements.

 
In 2010 through 2014, Forex Trend saw an uptrend allowing its clients to make millions of dollars. In early 2015, the trend slowed down and a retracement followed, which reflected in some major difficulties for the company and its clients.
 
However, a new uptrend is coming, thereby giving Forex Trend clients hope for the better. The new uptrend for the company and its clients is expected to start in September 2015…
 
The thing is that Concorde Capital, one of the biggest investment companies out there, decided to purchase Forex Trend, thereby giving all of its clients to get the frozen funds back and make new profits.
Publication date: 30 July 08:14 AM

Brent Oil Drops below 54 Dollars per Barrel

 

The cost of September future contract of Brent oil has dropped to 53.71 US dollars during London trading session this Monday. This is 1.69 percent lower than the cost of the previous trading session held on Sunday. That day the price of Brent during a trading session amounted to 54.67 dollars.
 
The last time oil of this brand dropped below 54 dollars per barrel was on March 20. This is proved by data recorded at the stock exchange. That day barrel of Brent has reached the minimal point of 53.55 dollars.
Publication date: 30 July 07:21 AM

“Gazprom” Reduces Gas Recovery in 2015

Ministry of Economic Development and Trade of the Russian Federation (MEDT) has held monitoring of economic situation around “Gazprom”. “Results of the research show that during the first six months of 2015 “Gazprom” has considerably reduced the volume of gas recovery and export,” inform the experts of “Market Leader” online-magazine.

 

Publication date: 29 July 01:57 PM

Orbex Launches New Partners Area for FX Affiliates

 

Not so long ago, Orbex started a new partners area for all those who promotes this FX broker and makes money by doing so. As a client-oriented company, Orbex strives to make it a better place for both client (traders and investors) as well as partners (affiliates, introducing brokers etc). Therefore, The Orbex team is constantly working on the quality and efficiency of the company’s products and services.
Publication date: 29 July 10:02 AM

Forex. EURUSD: Dollar Drops Versus Euro Amid German Import Figures

 

According to the recent report published by Destatis, Germany’s official statistics agency, the import prices in Germany dropped in June 2015. It should be noted that the June decrease indicated acceleration in the dynamics, i.e. relative to the the same figures seen in May. The actual figures exceeded analyst expectations.  
 
Publication date: 29 July 09:15 AM

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Market Leader reports that according to the recent statement made by DBS, Singapore’s biggest bank, it’s net profits increased by 15% in Q2 2015. In absolute figures, this is some $800 million.
 
Publication date: 29 July 05:32 AM

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The latest retail sales report published by the Office for National Statistics (ONS) earlier in July indicated a decline. According to Market Leader, this came as a surprise for most analysts out there.
Publication date: 28 July 11:24 AM

NordFX Names TOP 5 FX Signal Providers In June 2015

 

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