What is REIT - Real Estate Investment Trust

What is REIT (Real Estate Investment Trust) - REIT stands for Real Estate Investment Trust, it can be seen as a mutual fund that instead of investing in stocks invests in real estate. It is an organisation that deals in securities which may be sold like shares on major exchanges. REIT invests in real estate either directly or through mortgages by making a combined pool of money from investors which can range from small retail type to large accredited ones.

REIT own income-producing real estate which are in form of offices, apartment buildings, warehouses, hospitals, hotels, shopping malls etc. It benefits investors in several ways such as helping them attain regular income streams, long-term capital appreciation, diversify their investment portfolio, invest in real estate with relatively small capital etc. REIT’s prove to be strong income vehicles because they pay out almost 90% of their taxable income to the shareholders in form of dividends and shareholders pay taxes on those dividend. As Real Estate Investment Trust receive special considerations regarding tax, so high yields and liquid methods are offered to investors.


Types of Real Estate Investment Trusts

1. Equity REIT – In this type, investment is made in owning properties or a part of it thus generating their core income either by property rents or  by selling their long-term properties. Equity REITs are tilted towards specializing in owning certain building types such as apartments, shopping malls, corporate offices, hotels etc. Few concentrate on owning & generating revenues from a single type of building while others diversify.

2. Mortgage REIT – In this type, revenue is generated from investing not directly in the property instead investing it in mortgage related to a real estate. Money is either lent directly to the owners of real estate in form of a mortgage or existing mortgage is acquired or a mortgage-backed security is purchased. This may be done for both residential & commercial properties. Prime source of money is earned in form of interest generated on mortgages.

3. Hybrid REIT – It is a combined outcome of equity REIT’s and mortgaged REIT’s. This investment is done carefully in both properties and mortgages thus getting benefits of both the dimensions.


REIT – Common Qualifications

Different countries have different internal criteria(s) to qualify a company as a Real Estate Investment Trust, below mentioned are few common points across various nations:

1. Invest about 75% of assets in the field of real estate.

2. About 75% of gross income should be generated from real property or interests from mortgages.

3. Pay approx 90% of its taxable income to shareholders as dividends every year.

4. Should be controlled and managed by Board of Directors or Trustees.

5. At least have 100 shareholders.


Benefits of a REIT

1. High Yields – For most people, main attraction of this scheme is the income earned which usually outperforms the broader market making this a lucrative option.

2. Easy Tax Procedure – Tax issues with REIT’s are more straight forward when compared to other schemes or partnerships. A form 1099-DIV is sent to shareholders which contain the breakdown of dividends. Each year dividends are allocated from capital gains and ordinary incomes. So it becomes easy to invest here.

3. Liquid Asset – Since REITs can be listed as stocks on major exchanges hence they are easy to buy and sell. This makes them liquid & hassle free.

4. Diversification – Research has shown adding REIT’s to any investment increases returns and diminishes risk as they have very little correlation with the stock exchange(s).

5. Leverage – Usually a small investor with less to moderate initial capital can not buy real estate easily, they may never be able to get the benefits of investing in high potential commercial real estate such as shopping malls, office spaces etc. Such investors can leverage their investment and get the benefits they otherwise may never be able to get.

Tips For Binary Options And Trading Strategies

Tips For Binary Options And Trading Strategies - Trading strategies and tips for binary options is information gathered by one who is determined, disciplined and has the drive to put a blueprint to together and follows it in detail, every time a trade is made. Rules are very important to follow when dealing with any amount of money you are trading to make a profit. Veering off your plan of action can lead to disaster. A basic outline should consist of having general knowledge of technical analysis, bankroll management, and risk management. Consider this your foundation for making trades.

1. Technical Analysis - Knowing how to read a chart to make money, would be a good starting point, when trading binary options. Set up your chart so that it is easy on your eyes as you stream through data to make trades. Knowing how to use your indicators and oscillators could be vital tools when it comes down to placing your trade. Entry points in the market well separate anyone from a winning trade and losing trade. Any successful trader utilizes the tools in front of him.

2. Bankroll Management - Knowing how to use manage your money is very important when trading. For example, if you deposit $1000 into your broker account, it's safe to say you should only trade with 5% of your deposit. This comes out to be $50 a trade. Now if you like you can divide that into any amount and get more trades. For example you can do 2 trades at $25, or you can do 5 trades at $10.

3. Risk Management - To some traders, risk in binary options is considered low. Every trader knows the rate of return on their money, if they win the trade, and if they lose a trade, they know what is lost, at the striking price. This may not be the case when you are making a trade on an upward trend that is for sure in the money, and at the last seconds, reverses and you miss out on your profit by one pip. We have all experienced this, and it raises the risk because it wasn't suppose to happen. Entry points are very important and must be practiced repeatedly to reduce the risk and increase your chances for winning more trades.

Learning trading strategies and tips for trading binary options could be beneficial for anyone who is willing to be a successful trader. This does not happen over night. Putting in the time is inevitable. If it were easy, everyone would be doing it and making money.

Binary Options Trading

Binary Options Trading - What is Binary Options Trading? Binary Options is a trading format that has only two final outcomes. Traders are able to make good returns by simply trading on these two outcomes.

Choosing "High" or "Low" is the most popular outcome. Before the start a period of time needs to be fixed before a trade can be placed. When the time frame has ended the asset price will either be higher or lower than that fixed at the outset. If the prediction is correct and the asset's price at the end of the time of expiry is on the correct side of the initial or "strike" price, the trader will receive a return. If predicted incorrectly the amount invested will be lost.

The Ease of Binary Options Trading

Usually when investing in assets investors look to buy a quantity of a stock. That is what we mean when we say that someone has shares in a product or an investor is a shareholder in a company.

The asset price is measured in the individual share price. Profits are made when the trader sells his asset back at a higher price than that at which he purchased the asset at the outset. Similarly, a loss will have been made if the asset's selling price is less than the price it was purchased for.

For this kind of trading it is necessary to possess a huge amount of understanding of a broad number of variables. A trader would need, for instance, to have studied the previous performance of an asset, how the said asset tends to react to events in the market that cause its price to change and, then, most importantly in terms of investment placing, to make educated forecasts on the future movements of the asset price.

Downturns in the market are nothing unusual and we can see on the news how many changes take place across the world's financial markets from day to day. To make good use of all of these variables the trader who manages to place successful trade after successful trade knows and understands asset price changes and has a resource of trading strategies that can be applied quickly to given situations up his sleeve.

By neglecting all of these considerations you risk experiencing your very own personal crash. What you have set aside for investing will likely as not evaporate, you won't have enough money to buy presents for the kids at Christmas and your partner may run off with someone considerably more successful at trading than yourself|

Unlike stock market investments with Trading Binary Options purchasing assets or stocks in a business is not required. What was mentioned before was that your trades are based on the movements of an asset price and if the price of an asset will rise or fall. In this case you are trading on an up or down movement in the price of an asset. Notably enough, Binary Options Trading helps potential investors get up and running without having to lay out huge sums of cash, because the required investment amount can be much smaller.

Look at the commodity Gold which has a market value so high that very few people actually acquire any stock in Gold. If you are trading in the Binary Market you do not need to purchase any gold, instead you are making predictions and investing based on whether the value of Gold will increase or decrease.

Which Assets are Good for Trading as Binary Options?

We are now at the stage where we are starting to think about commodities; in the previous instance we touched upon Gold. So, without too much jargon it's worth taking a look at the types of assets that are used in Binary Options Trading.

• Indices - An index is the stock exchange itself. The NYSE is in New York, the FTSE is located in London and along with these two is the NASDAQ. One can make trades on the value of the market place at the start and end of trading!

• Forex - Is to do with major world currencies, like the US Dollar (USD) or the Japanese YEN (JPY) Trading on currency pairs can present quick and highly lucrative investment opportunities.

• Commodities - Could be either something extracted, for instance, coal or gas or something that is cultivated such as cocoa or livestock.

• Stocks - We talked about purchasing shares earlier on, these could be shares in a company or a business such as Walmart or HSBC.

Researching your chosen asset is where you begin before you commence trading. Although I explained that one of the major lures to Binary Options Trading is the ease and speed with which you access the trading markets it is a major advantage if you keep up to date with how your asset fairs in the market. If the fluctuations in the price of Copper are of interest to you, it would probably make sense to use Copper as your chosen binary asset. It stands to reason then, that the more up to date you are with the price changes of your asset in the market, the more likely you are of successfully predicting the direction of the price movement.

When trading binary options always be sure to use the best and most respected brokers in the industry. For up to date reviews, news and trading tips on Binary Options and Binary Options Trading take a look at Binary Expert.

Forex Trading Strategies

Forex Trading Strategies - Forex trading revolves around currency trading. The value of the currency can rise and fall as a result of different factors that include economics and geopolitics. The changes in the currency value are what factor in the profits for Forex traders and this is the main objective of getting into the trades. The trading strategies are sets of analysis used by the traders to determine whether they should sell or buy currency pairs at a given period of time.

These strategies can be technical analysis charting tools based or news based. They are made of a multiple of signals that trigger the decisions whether to buy or sell the currencies a trader is interested in. The strategies are free for use or they can also be offered at a fee and are usually developed by the Forex traders themselves.

The strategies can also be automated or manual. Manual systems require a trader to sit and look for signals and also interpret them so they can decide whether to sell or buy. Automated systems on the other give traders more flexibility because they can customize software to look out for specific signals and interpret them. Trading strategies may not be all that perfect in making money, but when you have a sound understanding of what they are all about, it becomes easier to adopt reliable approaches when trading in the currencies.

Forex Trading Strategy Types

There are so many strategies out there that can be used by Forex traders. The most important thing would be for the trader to decide what strategy matches the kind of trading experience they wish to have and what strategies offer the best signals for interpretation so the best trading moves can be taken.

Below are some of the top strategies most traders use and some you should consider if you are a beginner in the markets.

• Forex Volatility Strategies - The Forex market can be volatile, meaning that the prices can make very sharp jumps. Volatility systems are created to take advantage of the price actions and are usually best for short term and quick trades. The systems are also based on volatility increase and whereas their winning percentage of trades may be higher, the profits earned per trade can be comparatively low. This strategy is best for traders and investors who understand the volatility perception.

• Forex Trend Following Strategies - These strategies use market trend marketing to guide traders towards their long term trading goals. Moving average, current market price calculation and channel breakouts are commonly used to generate signals and decide the best market direction to take. Instead of predicting or forecasting prices, traders using these strategies only follow the market trend.

• Forex Scalping Strategies - Scalping in Forex involves making multiple trades with each of the trades making small profits individually. When using the scalping strategies of trading, the profits are usually anywhere between 5 to 10 pips for each trade. These strategies require constant Forex market analysis and the trader also need to place multiple trades at once. They can be pretty demanding and traders need to be relatively fast in predicting where the markets are headed so they can open and close positions in the shortest time possible.

• Forex Pivot Point Strategies - Pivots make it possible to identity entry points especially for range bound traders. These points are also helpful to breakout traders and trend traders in spotting key points that need breaking for given trading move so they qualify as breakout. Traders who understand pivot and calculations around it will find these strategies quite helpful in trading currencies. It is important to remember that calculating pivot using closing prices of the short time frame reduces significance and accuracy of the point of rotation. The calculations need to be precise because they make the Forex market backbone.

• Forex Chart Pattern Strategies - Charts are vital in Forex trading in assisting traders in the markets. There are different chart patterns that can be used when trading, but the most common patterns are triangle and head and shoulder. Triangle patterns occur mostly in short-term time frames and can descend, ascend or be symmetrical. Price converges with low and high creates the triangle leading into the tight price area. The head and shoulder pattern on the other hand is more like topping formation when an uptrend occurs and bottoming formation when there is downtrend. The pattern will usually complete in Head and Shoulder when the trend line is broken.

• Forex Renko Chart Strategies - Renko charts are constructed when price surpasses bottom or top of the previous brick by pre-defined amounts. When this happens, the brick is moved in the next column. White bricks are usually used when the trend is up, whereas the black ones are used when the trend is down. This type of charting is useful in identifying key resistance and also support levels. In Renko charts, time and volume really have no major role. You will find all kinds of trading strategies that are Renko chart based to assist your trades.

Other Forex trading strategies you can use are the Bollinger Bands, Forex breakout, Forex support and resistance, Forex candlestick and Forex swing trading strategies.

Picking the best Forex trading strategy

With so many trading strategies available it can be challenging for traders, especially beginners, to decide which way to take. But using a few tips you can have an easier time choosing the best.

Set trading goals and decide whether to go long term or short term. It also helps to decide whether to trade full time or part time. This way you will be able to choose the strategy that best suits you as a trading individual.

Choose a unique strategy by comparing strategies and what they have in store for you. If a strategy does not seem to lie in your best interest, then it is not the right one for you.

Experiment on the strategy you prefer before settling for it. Experimenting first gives a chance to have a deeper understanding of what the strategy is all about and see whether it has worked for other traders in the past or not.

It is also important that you get familiar with trading styles so you can choose the perfect strategy for your trading. For instance, short term traders should consider trading styles like day trading, scalping, position trading and swing trading among others.

The trading strategy you choose can make or break your trades. Take your time to learn as much as possible about the different strategies them make an informed decision.

What You Get When You Pay For Investment Services

What You Get When You Pay For Investment Services - Investment services offered to individual investors come in a myriad of packaging and delivery options. Discount brokerage houses, full-service brokerage houses, load mutual fund firms, no-load mutual fund firms, banks, insurance companies, private money management firms and fee-based advisors all attempt to convince investors that they are the best available alternative. Yet, despite their different packaging they are each providing all or part of the same three primary value components - advice, portfolio management and administration.

Advice is the process of defining and implementing an appropriate investment strategy given an investor's objectives and particular constraints. Portfolio management is the process of building and maintaining an investment portfolio that properly addresses the strategy the advisory component has defined. Administration is all the trading, clearing and reporting functions required to effectively execute the portfolio management process.

This article will take a closer look at the subcomponents within each of the three broad value components and show you how to use them to analyze which parts of the financial management process are worth paying for, and which you may want to take on yourself.

Administration
Of the three components, administration is the one that you will be least able to do on your own. Any registered broker/dealer has access to many equity, fixed-income and commodities markets through which they can buy and sell. For a host of reasons, you are not able to go directly to these markets yourself. As such, this is a subcomponent that you will have to outsource and pay for in the form of some fee or commission. Fortunately, with online discount brokerages, the costs associated with trading are minimal. In addition, these costs cover trade settlement, confirmations, and other client statements, all of which are in compliance with mandated regulations. There are some other administrative services, however, that are not automatically supplied by your brokerage firm.

While year-end reporting for tax purposes is required, not all brokerage firms track cost basis for you. This is something you can do yourself with a spreadsheet or even a notepad, but depending on the number of holdings you have it can be a time-intensive. In choosing a brokerage firm, try to find one that keeps accurate track of your cost basis. It will save you time when you prepare your tax returns each year. (For more insight, read How do I figure out my cost basis on a stock investment?)

Another important administration function you can handle yourself is performance reporting. Truly accurate reporting, however, will be almost impossible without some fairly sophisticated software that keeps track of all cash flows and is able to calculate time-weighted total rate of return. If your brokerage firm can do this for you at no additional charge, you are receiving a material increase in value.

Portfolio Management
Most investors, and sadly most investment advisors, have little training or knowledge regarding security analysis and portfolio management. Typically, investor portfolios are built in a hodge-podge manner over time. Securities are chosen without benefit of in-depth analysis and without proper regard as to how they interrelate with one another. Holdings are often spread over numerous accounts held at various locations so there is little way to determine how the overall investment portfolio is performing.

Proper security analysis is required to identify suitable and attractive investments. The level of expertise needed varies between investment types. Stock analysis can be fairly straightforward, but many fixed-income investments incorporate a variety of factors that must be carefully considered. Derivatives, options, futures and commodities are even more complex. Without extensive training, you may find it extremely difficult to ascertain fair value of the many varied security options available. On top of the security selection requirements, you must understand how these individual securities act in concert to form an efficient and effective portfolio. At a minimum, you will need to understand some of the core principles of modern portfolio theory (MPT).

Unfortunately, most retail investment advisors have little training in security selection and overall portfolio management. Base licensing requirements are far from in-depth. Various "professional" designations abound, but many are rudimentary at best. The preeminent professional designation for portfolio management is the Chartered Financial Analyst (CFA). The CFA is nearly a requirement if one wishes to be a security analyst or portfolio manager on Wall Street. It is an intensive and comprehensive training program that takes a minimum of three years to complete. Few retail investment advisors hold the CFA and individual investors do not even have access to the program. (For more insight, read The Alphabet Soup Of Financial Certifications.)

You can create and manage an effective investment portfolio without a CFA designation of your own or a CFA acting as your advisor, but it may be more challenging than you think. You could find that you gain more than you lose by outsourcing this particular value component. (For more insight, see Manage My Own Investments? Are You Kidding?)

Advice
Serving as your own investment advisor may be the easiest of the three value components to do yourself. Still, a host of constantly changing factors involving not only investments, but also taxes, insurance needs, liquidity needs, and other special needs or constraints must be addressed.

Resources for financial advice are plentiful. A multitude of books, magazines, web sites, blogs, and organizations churn out tons of valuable information covering almost every aspect of financial planning. With time and effort, there is no reason to believe that reasonably intelligent investors can't serve adequately as their own investment advisors. The key consideration should therefore be the desire to do so. Laws and regulations are constantly in flux. Staying abreast of these changes and adjusting your plan accordingly can be time consuming. If you have the time and desire it can be done, but you may find that you would prefer some help. (For more, see Tailoring Your Investment Plan.)

If you do decide you want the assistance of a professional advisor, your key consideration should be value, since pricing for this service is fairly comparable. Once again, base securities license requirements focus on investment alternatives. Comprehensive financial planning is not covered.

Know Your Limitations, Maximize Your Value
When taking on part of the investment process yourself, you must know your limitations. Being a do-it-yourself investor entails much more than picking a stock or selecting a mutual fund. Make an honest assessment of your abilities, available time and level of desire. If you choose to outsource some or all of the components or sub-components, make certain that you maximize your value. Choose advisors who have demonstrated a commitment to learning and excellence. Select portfolio managers with proper training and credentials. Use brokerage firms that provide a full array of comprehensive services. If you follow these basic principles, there is no reason you won't succeed, regardless of whether you do all of it yourself, some of it yourself, or none of it yourself.