Heroes of Ukraine

«Market Leader» - news and previews making you rich.

Monday, 21 August 11:51 (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

 

Add to blog
Got a question? – Ask it here »
 

Dukascopy Bank on Bitcoin Future after Bitcoin Split

On August 1st, 2017, the entire world of cryptocurrencies changed. The thing is that from now on, there are 2 forks of the world’s first and most popular cryptocurrency, which also enjoys the biggest market capitalization among its peers. We are talking about Bitcoin (BTC) and Bitcoin Cash (BCC). The split was followed by increased market volatility for both currencies, which was mostly of technical nature caused by the circulation of Bitcoin Cash rather than the classic supply and demand, experts say.

Publication date: 15 August 09:11 AM

Masterforex-V VIP Traders’ Performance. July 2017

The unbeatable FX strategies mentioned in a brand new book on the secrets of Forex investing by Masterforex-V keep on making both traders and investors richer. By the way, the yield in this case is way bigger than the one you can get by investing in bank deposits or any related low-income investments. The very essence of this kind of investing makes it possible to avoid poor and hasty decisions, thereby leveraging the entire process. By the way, VIP accounts have been among the top 10 accounts available for auto-copying at pro-rebate.com.

Publication date: 09 August 05:33 AM

UK Ready to Pay 40 Billion Euro for Brexit

The international expert community along with mass media keep on trying to evaluate the cost of the Brexit for the United Kingdom. The most popular version is that quitting the European Union will cost Great Britain around 40 billion euros. In particular, this idea is advocated by Deutsche Welle.

 

 
At the same time, The Sunday Telegraph claims that the specifics of the financial compensation to Brussels will become the catalyst for the Brexit talks. While referring to the high-ranking sources in the British government, The Sunday Telegraph reports that the government is ready to pay the EU up to 36 billion pounds, which is around 40 billion euros. This is the sum is intended to cover the UK’s financial liabilities to Brussels.
Publication date: 08 August 09:29 AM

Masterforex-V Expo Names World’s Best Brokers for Beginners in July 2017

Along with required knowledge and skills, the broker makes up the lion’s share of the trader’s success in the Forex market. That’s why choosing the right broker right off the bat is so important.

 

At the same time, most of the traders joining Forex to start making money often lack the required experience to make the right choice. On top of that, most of them are convinced that all the brokers are the same, which is why they ignore the significance of making the right choice and make this choice randomly.
Publication date: 08 August 03:54 AM

Bitcoin Exceeds $3300 Threshold

Bitcoin, which is the world’s first and most popular crypto-currency, started another strong rally a few days after it was split into 2 versions. According to Coindesk, the classic version of Bitcoin exceeded the $3300 threshold and set another all-time high at $3319. The thing is that the market capitalization of Bitcoin has been growing continuously ever since the mentioned split.

 

 
Publication date: 06 August 11:48 AM

Continuous Rally Shown By Crypto Currencies As Investment Opportunities

The phenomenal growth seen in crypto currency markets has become one of the leading tendencies of the year. Some of the crypto currencies have seen their value grow by 100%, 200% and even more. As for Bitcoin, which is the world’s first and most popular crypto currency, back in January 2017, it cost $1000 while in early July it cost over $2600.

Publication date: 29 July 01:00 AM

Alpari Increases Trading Turnover Up To $600,9 Billion In 6 Months

The international FX industry has recently been involved in a number of scandals. Against this background, we can only name a few companies with positive dynamics, efficient market products, and major license.

Publication date: 27 July 01:18 AM

Another Bitcoin Fraud Is Caught

Crypto currencies are controversial. On the on hand they give investors a decent investment opportunity. On the other hand, the may be way too risky. Often times, those are both market and even non-market risks, including fraud.

 

 
In some of the previous articles, we recommended you to start with a sound financial strategy and risk management before you invest even a penny in crypto currencies. We are not trying to say that those are bad investments. They can make you money if you really know what you are doing. However, you should be really careful about it since the advantages of decentralized and anonymous currencies may turn into disadvantages and loses for your wallet.
Publication date: 23 July 12:25 PM

Will European Parliament Help IronFX Victims?

Europe’s leading financial regulators have recently been founding them involved in various scandals. TheFinancial Conduct Authority (FCA) from the UK and the CySEC from Cyprus are some of them. The truth is, while those companies claim that they defend the customer’ rights, in reality they often take the broker’s side even though the broker may be playing dirty tricks on the customer.
Publication date: 20 July 03:19 AM

In June 2017, Masterforex-V Investors Made Money Again

The unbeatable FX strategies mentioned in a brand new book on the secrets of Forex investing by Masterforex-V keep on making both traders and investors richer. By the way, the yield in this case is way bigger than the one you can get by investing in bank deposits or any related low-income investments. The very essence of this kind of investing makes it possible to avoid poor and hasty decisions, thereby leveraging the entire process. By the way, VIP accounts have been among the top 10 accounts available for auto-copying at pro-rebate.com.

Publication date: 13 July 09:38 AM