Believe that life is worth living and your belief will help create the fact.
~William James
(Read more at: http://mobile.brainyquote.com/quotes/quotes/w/williamjam101061.html)
Thursday, November 17, 2016
Quote Of The Day
Sunday, December 13, 2015
PICKING THE RIGHT INVESTMENTS.
Investment
Analysis:
First
Principles
Invest in projects that
yield a return greater than the minimum acceptable hurdle rate. The hurdle rate
should be higher for riskier projects and reflect the financing mix used -
owners’ funds (equity) or borrowed money (debt).
Returns on projects
should be measured based on cash flows generated and the timing of these cash
flows; they should also consider both positive and negative side effects of
these projects. Choose a financing mix that minimizes the hurdle rate and
matches the assets being financed. If there are not enough
investments that earn the hurdle rate, return the cash to stockholders. The form of returns - dividends and stock buybacks - will depend
upon the stockholders’ characteristics.
What is an investment or a project?
Any decision that
requires the use of resources (financial or otherwise) is a project. Broad strategic decisions
- Entering new areas of business
- Entering new markets
- Acquiring other companies
Tactical decisions
- Management decisions
- The product mix to carry
- The level of inventory and
credit terms
- Decisions on delivering a
needed service
- Lease or buy a distribution
system
- Creating and delivering a
management information system
What is Risk?
Risk, in traditional
terms, is viewed as a ‘negative’. Webster’s dictionary, for instance, defines
risk as “exposing to danger or hazard”. The Chinese symbols for risk,
reproduced below, give a much better
Description of risk. The
first symbol is the symbol for “danger”, while the second is the symbol for
“opportunity”, making risk a mix of danger and opportunity
Therefore,
A danger results
into opportunity that create a living in a means of mind blowing/thinking on
the way to earn a living.
"Think, Innovate, Create"
Wednesday, October 1, 2014
WHAT IS AN INVESTMENT OPPORTUNITY?
An investment opportunity is any situation where you have the option of purchasing something that has a chance to gain value in the future. Investment opportunities are different from investment prospects, which refer to possible future investment opportunities. The key to making money through investing is knowing which opportunities to take advantage of and how to manage them.
Types
Investors who seek out investment opportunities will find no lack of options. Stock markets stay in business by marketing investment opportunities to buyers who put their money into companies with hopes that they'll grow. Government bonds are another source of investment opportunities, allowing buyers to loan money to the government in exchange for interest. Real estate is another type of investment opportunity, with the prices of homes and land constantly rising and falling. Other investment opportunities include classic automobiles, collectibles, foreign currencies and commodities, such as agricultural products and precious metals.
Risk
One of the ways to differentiate between investment opportunities is by examining the amount of risk each one represents. Economists refer to a given investment's likelihood to change its value as volatility. For example, stocks are highly volatile since new products and financial reports can make investors more or less willing to own shares in a company, causing the price to drop or rise. Government bonds, on the other hand, have a very low volatility and represent safe investment opportunities that have limited room for growth. Predicting volatility and accounting for risk are essential to making money consistently by investing.
Friday, February 8, 2013
HOW TO INVEST
How to Invest
Whether you have $20 or $200,000 to invest, the objective is the same: to make your money grow. The means, however, vary dramatically based on the amount of money being invested, the state of the market, and your own investing style.
Steps
Pay off high interest debt. If you have a loan or credit card debt with a high interest rate (over 10%) there's no point in investing your hard-earned cash. Whatever interest you earn through investing (usually less than 10%) won't make much of a difference because you'll be spending a greater amount paying interest on your debt. For example, let's say Sam has saved $4,000 for investing, but he also has $4,000 in credit card debt at a 14% interest rate. He could invest the $4,000 and if he gets a 12% ROI (return on investment--and this is being very optimistic) in a year he'll have made $480 in interest. But the credit card company will have charged him $560 in interest. He's $80 in the hole, and he still has that $4,000 principal to pay off. Why bother? Pay off the high interest debt first so that you can actually keep any money you make by investing. Otherwise, the only investors making money are the ones who loaned it to you at a high interest rate.
Friday, December 28, 2012
A SIMPLE LESSON TO ENTREPRENEURS.
5 Essentials of Small Business Investing
The most important question for a small business investor is where to
focus attention. What makes one company more interesting than another?
There are 28 million small businesses in the U.S., but few research
services. This provides great opportunities for above-market returns
but also means investors must have an approach for determining which
companies are worth focusing on. After many years of investing in
private companies, I have developed an initial framework–the first five
things I look at when I see a new company.
This list is not intended to be all-inclusive; it’s intended only to serve as a starting point. Valuation and deal structure, for example, are critical (likely an entirely separate post). The principles behind this list could apply to many industries, but they are especially relevant to consumer and retail businesses, the industries in which I have the most experience.
1. Gross Margin. Gross margin is the percentage difference between what a product sells for in the market (revenue) and what it costs to produce that product (cost of goods sold, or COGS). This ratio is critical because it is what allows a company to invest in all the other areas needed to get the product to market such as marketing and distribution.
Gross margins can vary by industry, and even by categories within an industry, but razor-thin gross margins leave no room for error. In private equity, I focused on investing in categories that had higher gross margins and thus could sustain increased costs more easily. Examples of higher gross margin categories include personal care, premium pet food, and natural and organic products.
It’s very important to keep in mind that gross margin expansion is very difficult. Focusing on creating products with better margins, automating production or getting lower prices for ingredients can help, but the instances where gross margin improvement drives outsized investment returns are rare.
This list is not intended to be all-inclusive; it’s intended only to serve as a starting point. Valuation and deal structure, for example, are critical (likely an entirely separate post). The principles behind this list could apply to many industries, but they are especially relevant to consumer and retail businesses, the industries in which I have the most experience.
1. Gross Margin. Gross margin is the percentage difference between what a product sells for in the market (revenue) and what it costs to produce that product (cost of goods sold, or COGS). This ratio is critical because it is what allows a company to invest in all the other areas needed to get the product to market such as marketing and distribution.
Gross margins can vary by industry, and even by categories within an industry, but razor-thin gross margins leave no room for error. In private equity, I focused on investing in categories that had higher gross margins and thus could sustain increased costs more easily. Examples of higher gross margin categories include personal care, premium pet food, and natural and organic products.
It’s very important to keep in mind that gross margin expansion is very difficult. Focusing on creating products with better margins, automating production or getting lower prices for ingredients can help, but the instances where gross margin improvement drives outsized investment returns are rare.
MAGARI SOKONI.....!!!
unataka kumiliki gari km hili...????
piga namba hizi upate taarifa zaidi....0657 502882 au 0714 558877 au tuma message kwa maulizo ktk account hii
(used na mpya zinapatikana)
piga namba hizi upate taarifa zaidi....0657 502882 au 0714 558877 au tuma message kwa maulizo ktk account hii
(used na mpya zinapatikana)
Tuesday, July 3, 2012
Business Ethics. (read the article)
Business ethics is the behavior that a business adheres to in its daily dealings with the world. The ethics of a particular business can be diverse. They apply not only to how the business interacts with the world at large, but also to their one-on-one dealings with a single customer.
Many businesses have gained a bad reputation just by being in business. To some people, businesses are interested in making money, and that is the bottom line. It could be called capitalism in its purest form. Making money is not wrong in itself. It is the manner in which some businesses conduct themselves that brings up the question of ethical behavior.
Good business ethics should be a part of every business. There are many factors to consider. When a company does business with another that is considered unethical, does this make the first company unethical by association? Some people would say yes, the first business has a responsibility and it is now a link in the chain of unethical businesses.
Many global businesses, including most of the major brands that the public use, can be seen not to think too highly of good business ethics. Many major brands have been fined millions for breaking ethical business laws. Money is the major deciding factor.
If a company does not adhere to business ethics and breaks the laws, they usually end up being fined. Many companies have broken anti-trust, ethical and environmental laws and received fines worth millions. The problem is that the amount of money these companies are making outweighs the fines applied. Billion dollar profits blind the companies to their lack of business ethics, and the dollar sign wins.
A business may be a multi-million seller, but does it use good business ethics and do people care? There are popular soft drinks and fast food restaurants that have been fined time and time again for unethical behavior. Business ethics should eliminate exploitation, from the sweat shop children who are making sneakers to the coffee serving staff who are being ripped off in wages. Business ethics can be applied to everything from the trees cut down to make the paper that a business sells to the ramifications of importing coffee from certain countries.
In the end, it may be up to the public to make sure that a company adheres to correct business ethics. If the company is making large amounts of money, they may not wish to pay too close attention to their ethical behavior. There are many companies that pride themselves in their correct business ethics, but in this competitive world, they are becoming very few and far between.
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