The main business of banking company is to grant loans and advances to traders
as well as commercial and industrial institutes. The most important use of banks money is lending. Yet, there are risks in lending. So the banks follow certain principles to minimize the risk:
1. SAFETY
Normally the banker uses the money of depositors in granting loans and advances. So first of all initially the banker while granting loans should think first of the safety of depositor’s money. The purpose behind the safety is to see the financial position of the borrower whether he can pay the debt as well as interest easily.
2. LIQUIDITY
It is a legal duty of a banker to pay on demand the total deposited money to the depositor. So the banker has to keep certain percent cash of the total deposits on hand. Moreover the bank grants loan. It is also for the addition of short term or productive capital. Such type of lending is recovered on demand.
3. PROFITABILITY
Commercial banking is profit earning institutes. Nationalized banks are also not an exception. They should have planning of deposits in a profitability way pay more interest to the depositors and more salary to the employees. Moreover the banker can also incur business cost and can give more benefits to customer.
4. PURPOSE OF LOAN
Banks never lend or advance for any type of purpose. The banks grant loans and advances for the safety of its wealth, and certainty of recovery of loan and the bank lends only for productive purposes. For example, the bank gives such loan for the requirement for unproductive purposes.
5. PRINCIPLE OF DIVERSIFICATION OF RISKS
While lending loans or advances the banks normally keep such securities and assets as a supports so that lending may be safe and secured. Suppose, any particular state is hit by disasters but the bank shall get benefits from the lending to another states units. Thus, he effect on the entire business of banking is reduced.
OBJECTIVES OF THE STUDY
The following are the main objective of the studies.
1. To study the problem in financial crisis and money related query.
2. To evaluate banking is one of the most regulated businesses in the India.
3. To Analysis the role developing economy for the nation.
4. To study dynamic role in delivery and purchase of consumer durables.
Scope of the Study
All persons need money for personal and commercial purposes. Banks are the oldest lending institutions in Indian scenario. They are providing all facilities to all citizens for their own purposes by their terms. To survive in this modern market every bank implements so many new innovative ideas, strategies, and advanced technologies. For that they give each and every minute detail about their institution and projects to Public. They are providing ample facilities to satisfy their customers i.e. Net Banking, Mobile Banking, Door to Door facility, Instant facility, Investment facility, Demat facility, Credit Card facility, Loans and Advances, Account facility etc. And such banks get success to create their own image in public and corporate world. These banks always accept innovative notions in Indian banking scenario like Credit Cards, ATM machines, Risk Management etc. So, as a student business economics I take keen interest in Indian economy and for that banks are the main source of development.
So this must be the first choice for me to select this topic. At this stage every person must know about new innovation, technology of procedure new schemes and new ventures.
METHODOLGY
Theoretical study conducted on the basis of secondary data, collected from books, journal and annual reports.
2. BANK PROFILE:
Indian Bank
Name of the Branch : Karaikal. [0090]
Date of Opening : 1971
District/Port Open : Karaikal/Port Town.
Category/Size : Large.
Population : Urban.
Computerisation : CBS.
Name of the Branch Head : R.Muralitharan,(Senior Branch
Manager)
Staff Strength Officers : 06
Award Staff : 06
Sub Staff : 03
Productivity : Rs. 281.39 Lacs.
Branch Classification : Profit Centre.
Location of the Branch : No. 96-98 Bharathiyar Road,
Karaikal-609607
Competition in the area : Almost All Banks are functioning.
Potential Available : Situated in a Commercial Area with a number of shops around Scope for trade finance. Branch has to tap more trade finance.
Computerised : ATM/CBS.
Commercial Activity : Being a union territory, large commercial Industrial activities are on.
Monday, February 8, 2010
A Study the Strategies Issue in Indian Banking Sector
A banking company in India has been defined in the banking companiesact,1949.as one “which transacts the business of banking which means the accepting, for the purpose of lending or investment of deposits of money from the public, repayable on demand or otherwise and withdraw able by cheque, draft, order or otherwise.” Most of the activities a Bank performs are derived from the above definition. In addition, Banks are allowed to perform certain activities which are ancillary to this business of accepting deposits and lending. A bank's relationship with the public, therefore, revolves around accepting deposits and lending money. Another activity which is assuming increasing importance is transfer of money - both domestic and foreign - from one place to another. This activity is generally known as "remittance business" in banking parlance. The so called forex (foreign exchange) business is largely a part of remittance albeit it involves buying and selling of foreign currencies.
Functioning of a Bank is among the more complicated of corporate operations. Since Banking involves dealing directly with money, governments in most countries regulate this sector rather stringently. In India, the regulation traditionally has been very strict and in the opinion of certain quarters, responsible for the present condition of banks, where NPAs are of a very high order. The process of financial reforms, which started in 1991, has cleared the cobwebs somewhat but a lot remains to be done. The multiplicity of policy and regulations that a Bank has to work with makes its operations even more complicated, sometimes bordering on illogical. This section, which is also intended for banking professional, attempts to give an overview of the functions in as simple manner as possible. Banking Regulation Act of India, 1949 defines Banking as "accepting, for the purpose of lending or investment of deposits of money from the public, repayable on demand or otherwise and withdraw able by cheques, draft, and order or otherwise."
KINDS OF BANKS
Financial requirements in a modern economy are of a diverse nature, distinctive variety and large magnitude. Hence, different types of banks have been instituted to cater to the varying needs of the community. Banks in the organized sector can be classified in to the following
1. COMMERCIAL BANKS:-
Commercial banks are joint stock companies dealing in money and credit. In India, however there is a mixed banking system, prior to July 1969, all the commercial banks-73 scheduled and 26 non-scheduled banks, except the state bank of India and its subsidiaries-were under the control of private sector. On July 19, 1969, however, 14mejor commercial banks with deposits of over 50 Corers were nationalized. In April 1980, another six commercial banks of high standing were taken over by the government.
2. CO-OPERATIVE BANKS:-
Co-operative banks are a group of financial institutions organized under the provisions of the Co-operative societies Act of the states. The main objective of co-operative banks is to provide cheap credits to their members. They are based on the principle of self-reliance and mutual co-operation. Co-operative banking system in India has the shape of a pyramid a three tier structure, constituted by:
3. SPECIALIZED BANKS:-
There are specialized forms of banks catering to some special needs with this unique nature of activities. Foreign exchange banks, Industrial banks, Development banks, Land development banks, Exim bank are important.
4. CENTRAL BANK:-
A central bank is the apex financial institution in the banking and financial system
of a country. It is regarded as the highest monetary authority in the country. It acts as the leader of the money market. It supervises, control and regulates the activities of the commercial banks. It is a service oriented financial institution. India’s central bank is the reserve bank of India established in 1935.and it was nationalized in 1949.It is free from parliamentary control.
ROLE OF BANKS IN A DEVELOPING ECONOMY
Banks play a very important and dynamic role in the economic life of every modern state. A study of the economic history of western country shows that without the evolution of commercial banks in the 18th and 19th centuries, the industrial revolution would not have taken place in Europe. The economic importance of commercial banks to the developing countries may be viewed thus:
1. PROMOTING CAPITAL FORMATION:-
A developing economy needs a high rate of capital formation to accelerate the tempo of economic development, but the rate of capital formation depends upon the rate of saving. Unfortunately, in underdeveloped countries, saving is very low. Banks afford facilities for saving and, thus encourage the habits of thrift and industry in the community. They mobilize the ideal and dormant capital of the country and make it available for productive purposes.
2. ENCOURAGING INNOVATION:-
Innovation is another factor responsible for economic development. The entrepreneur in innovation is largely dependent on the manner in which bank credit is allocated and utilized in the process of economic growth. Bank credit enables entrepreneurs to innovate and invest, and thus uplift economic activity and progress.
3. MONETSATION:-
Banks are the manufactures of money and they allow many to play its role freely in the economy. Banks monetize debts and also assist the backward subsistence sector of the rural economy by extending their branches in to the rural areas. They must be replaced by the modern commercial bank’s branches.
4. INFLUENCE ECONOMIC ACTIVITY
Banks are in a position to influence economic activity in a country by their influence on the rate interest. They can influence the rate of interest in the money market through its supply of funds. Banks may follow a cheap money policy with low interest rates which will tend to stimulate economic activity.
5. FACILITATOR OF MONETARY POLICY
Thus monetary policy of a country should be conductive to economic development. But a well-developed banking system is on essential pre-condition to the effective implementation of monetary policy. Under-developed countries cannot afford to ignore this fact.
Functioning of a Bank is among the more complicated of corporate operations. Since Banking involves dealing directly with money, governments in most countries regulate this sector rather stringently. In India, the regulation traditionally has been very strict and in the opinion of certain quarters, responsible for the present condition of banks, where NPAs are of a very high order. The process of financial reforms, which started in 1991, has cleared the cobwebs somewhat but a lot remains to be done. The multiplicity of policy and regulations that a Bank has to work with makes its operations even more complicated, sometimes bordering on illogical. This section, which is also intended for banking professional, attempts to give an overview of the functions in as simple manner as possible. Banking Regulation Act of India, 1949 defines Banking as "accepting, for the purpose of lending or investment of deposits of money from the public, repayable on demand or otherwise and withdraw able by cheques, draft, and order or otherwise."
KINDS OF BANKS
Financial requirements in a modern economy are of a diverse nature, distinctive variety and large magnitude. Hence, different types of banks have been instituted to cater to the varying needs of the community. Banks in the organized sector can be classified in to the following
1. COMMERCIAL BANKS:-
Commercial banks are joint stock companies dealing in money and credit. In India, however there is a mixed banking system, prior to July 1969, all the commercial banks-73 scheduled and 26 non-scheduled banks, except the state bank of India and its subsidiaries-were under the control of private sector. On July 19, 1969, however, 14mejor commercial banks with deposits of over 50 Corers were nationalized. In April 1980, another six commercial banks of high standing were taken over by the government.
2. CO-OPERATIVE BANKS:-
Co-operative banks are a group of financial institutions organized under the provisions of the Co-operative societies Act of the states. The main objective of co-operative banks is to provide cheap credits to their members. They are based on the principle of self-reliance and mutual co-operation. Co-operative banking system in India has the shape of a pyramid a three tier structure, constituted by:
3. SPECIALIZED BANKS:-
There are specialized forms of banks catering to some special needs with this unique nature of activities. Foreign exchange banks, Industrial banks, Development banks, Land development banks, Exim bank are important.
4. CENTRAL BANK:-
A central bank is the apex financial institution in the banking and financial system
of a country. It is regarded as the highest monetary authority in the country. It acts as the leader of the money market. It supervises, control and regulates the activities of the commercial banks. It is a service oriented financial institution. India’s central bank is the reserve bank of India established in 1935.and it was nationalized in 1949.It is free from parliamentary control.
ROLE OF BANKS IN A DEVELOPING ECONOMY
Banks play a very important and dynamic role in the economic life of every modern state. A study of the economic history of western country shows that without the evolution of commercial banks in the 18th and 19th centuries, the industrial revolution would not have taken place in Europe. The economic importance of commercial banks to the developing countries may be viewed thus:
1. PROMOTING CAPITAL FORMATION:-
A developing economy needs a high rate of capital formation to accelerate the tempo of economic development, but the rate of capital formation depends upon the rate of saving. Unfortunately, in underdeveloped countries, saving is very low. Banks afford facilities for saving and, thus encourage the habits of thrift and industry in the community. They mobilize the ideal and dormant capital of the country and make it available for productive purposes.
2. ENCOURAGING INNOVATION:-
Innovation is another factor responsible for economic development. The entrepreneur in innovation is largely dependent on the manner in which bank credit is allocated and utilized in the process of economic growth. Bank credit enables entrepreneurs to innovate and invest, and thus uplift economic activity and progress.
3. MONETSATION:-
Banks are the manufactures of money and they allow many to play its role freely in the economy. Banks monetize debts and also assist the backward subsistence sector of the rural economy by extending their branches in to the rural areas. They must be replaced by the modern commercial bank’s branches.
4. INFLUENCE ECONOMIC ACTIVITY
Banks are in a position to influence economic activity in a country by their influence on the rate interest. They can influence the rate of interest in the money market through its supply of funds. Banks may follow a cheap money policy with low interest rates which will tend to stimulate economic activity.
5. FACILITATOR OF MONETARY POLICY
Thus monetary policy of a country should be conductive to economic development. But a well-developed banking system is on essential pre-condition to the effective implementation of monetary policy. Under-developed countries cannot afford to ignore this fact.
Ex-Lloyds Tsb Chairman Pitman To Join Virgin Money
Ex-chairman of Lloyds TSB - Sir Brian Pitman will be helping Richard Branson to take a step further in its assault on the UK’s established high street banks after it was announced that he will be taking on the chairman role for Virgin Money, the financial arm of Richard Branson’s empire.
The appointment of the new chairman is expected to come any time, which will help Virgin Money in its next step in launching a fully fledged banking service later this year.
Sir Brian, 78, is known for being highly respected, ranking among the most influential retail bankers of his generation.
He worked closely with Virgin in the past, after leading the group’s failed takeover bid for Northern Rock before it was nationalised by the government following problems with the lender in 2008.
In the 18 years he guided Lloyds as chief executive and chairman, his work transformed the group from a small clearing bank operating in the UK, to one of the largest banks in Europe, following the merger with TSB and a series of acquisitions.
Virgin Money - the first of a wave of prospective new banks to gain approval from the Financial Services Authority - recently purchased a small regional private bank - Church House Trust, in order to obtain its banking licence.
The acquisition has provided a platform for the bank to launch mortgages and current accounts for UK customers and a stepping-stone for further acquisitions.
Virgin Money is expected to be one of the frontrunners for a renewed bid for Northern Rock. It has also been rumoured that the group is to consider bidding for the branches and customer bank accounts being sold by Royal Bank of Scotland.
Virgin Money already has a prominent position in the UK credit card market with the market leading Virgin Money Credit Card, as well as a range of savings accounts, insurance and investments.
The appointment of the new chairman is expected to come any time, which will help Virgin Money in its next step in launching a fully fledged banking service later this year.
Sir Brian, 78, is known for being highly respected, ranking among the most influential retail bankers of his generation.
He worked closely with Virgin in the past, after leading the group’s failed takeover bid for Northern Rock before it was nationalised by the government following problems with the lender in 2008.
In the 18 years he guided Lloyds as chief executive and chairman, his work transformed the group from a small clearing bank operating in the UK, to one of the largest banks in Europe, following the merger with TSB and a series of acquisitions.
Virgin Money - the first of a wave of prospective new banks to gain approval from the Financial Services Authority - recently purchased a small regional private bank - Church House Trust, in order to obtain its banking licence.
The acquisition has provided a platform for the bank to launch mortgages and current accounts for UK customers and a stepping-stone for further acquisitions.
Virgin Money is expected to be one of the frontrunners for a renewed bid for Northern Rock. It has also been rumoured that the group is to consider bidding for the branches and customer bank accounts being sold by Royal Bank of Scotland.
Virgin Money already has a prominent position in the UK credit card market with the market leading Virgin Money Credit Card, as well as a range of savings accounts, insurance and investments.
Uk Economy Exits Recession
The UK economy has finally brought some good news after figures today confirmed the country's exit from recession. The economy grew by 0.1% in the last three months of 2009.
However, the rate at which the economy grew was weaker than expected.
BBC chief economics correspondent Hugh Pym said: "We can say that Britain has just crossed the line in coming out of recession
"It [the growth rate] was below analysts' expectations. The figure could be moved down, or indeed upwards."
In the previous six quarters the economy shrunk, marking the longest period of contraction since quarterly figures first began being recorded in 1955.
There have been some recent tell-tale signs that the economy was headed for recovery, for example last week UK unemployment dropped for the first time in 18 months. However, the Bank rate remains at it's record low of 0.5%, keeping rates on mortgages and savings accounts down.
The UK was the last major economy to remain in recession.
Germany and France – Europe's two biggest economies, both exited recession last summer. Japan and the US also came out of recession last year.
Some economists believe the move out of recession was boosted significantly by the government car scrappage scheme.
Joe Grice, from the Office for National Statistics (ONS), said that both the UK's production and service sectors grew by 0.1% during the last quarter of 2009.
The ONS figures also showed that GDP dropped by a record 4.8% in 2009.
The UK first fell into recession in the second quarter of 2008.
Throughout the 18 months of recession, public borrowing increased to an estimated £178bn, while output fell by 6%.
After the GDP figures were published, John Wright, chairman of the Federation of Small Businesses, said that the recovery remained "frail".
"In order to strengthen the recovery it is important that we boost consumer confidence and demand and that interest rates are held steady as continued investment in the economy will be the key to ensuring a sustainable recovery," he said.
However, the rate at which the economy grew was weaker than expected.
BBC chief economics correspondent Hugh Pym said: "We can say that Britain has just crossed the line in coming out of recession
"It [the growth rate] was below analysts' expectations. The figure could be moved down, or indeed upwards."
In the previous six quarters the economy shrunk, marking the longest period of contraction since quarterly figures first began being recorded in 1955.
There have been some recent tell-tale signs that the economy was headed for recovery, for example last week UK unemployment dropped for the first time in 18 months. However, the Bank rate remains at it's record low of 0.5%, keeping rates on mortgages and savings accounts down.
The UK was the last major economy to remain in recession.
Germany and France – Europe's two biggest economies, both exited recession last summer. Japan and the US also came out of recession last year.
Some economists believe the move out of recession was boosted significantly by the government car scrappage scheme.
Joe Grice, from the Office for National Statistics (ONS), said that both the UK's production and service sectors grew by 0.1% during the last quarter of 2009.
The ONS figures also showed that GDP dropped by a record 4.8% in 2009.
The UK first fell into recession in the second quarter of 2008.
Throughout the 18 months of recession, public borrowing increased to an estimated £178bn, while output fell by 6%.
After the GDP figures were published, John Wright, chairman of the Federation of Small Businesses, said that the recovery remained "frail".
"In order to strengthen the recovery it is important that we boost consumer confidence and demand and that interest rates are held steady as continued investment in the economy will be the key to ensuring a sustainable recovery," he said.
Opening A New Bank Account If Your Credit Rating Is Poor
Even those with a poor credit rating can open a new bank account. You just need to understand the right questions to ask.
If you are struggling with personal debt, one of the first steps to getting back in control is often to open a new bank account.
Opening a new account is important because you need to make sure that any money paid into your account is fully under your control.
If you continue to use a bank account which is operated by one of your creditors they may take money from your account without your authority. They are allowed to do this under the right of offset.
Ask for a basic account
When you apply for a new current account, the first thing the bank will do is carry out a credit check on you.
If you have debt problems and have missed payments, your credit rating is likely to be poor. If this is the case, you will fail the bank’s credit check, and your application will be refused.
If you believe that your credit rating is poor, you should be up front about this.
When you speak to a bank, tell them that you may not pass their standard credit check and so you require a simple bank account with no credit facilities.
This type of account is often known as a basic account or a card cash account. Many high street banks offer a basic bank account facility which they will open for you without needing to pass a standard credit check.
No credit facilities
A basic bank account will allow you to set up standing orders and direct debits. However, the downside is that you will not be offered credit facilities such as an overdraft.
Another problem with many basic accounts is that you will not be given a debit card.
Some basic bank accounts such as the Co-Op cash minder do offer a debit card facility. However if the bank you have chosen does not, you can consider getting a pre-paid debit card.
Pre-paid debit card
A pre-paid card operates in exactly the same way as a pay as you go mobile phone. You can only use the card if you have available credit. You increase the credit on the card by paying money into the card account.
Pre-paid cards are very useful for those unable to get a normal debit card.
They reduce the need for carrying large amounts of cash and enable you to do your shopping on line.
However, the downside is they can be costly to use as a fee is charged each time money is credited to the card and for cash withdrawals.
If you need to change your banking facilities but believe that your credit rating is poor, it will be possible to open a new account. You just need to go about the application in the right way.
You should be up front in asking for a basic account and must not expect to be offered credit facilities.
Remember to look for a bank which offers a debt card with their basic account. This will be a cheaper solution than paying for a pre-paid card if you decide to apply for one later.
If you are struggling with personal debt, one of the first steps to getting back in control is often to open a new bank account.
Opening a new account is important because you need to make sure that any money paid into your account is fully under your control.
If you continue to use a bank account which is operated by one of your creditors they may take money from your account without your authority. They are allowed to do this under the right of offset.
Ask for a basic account
When you apply for a new current account, the first thing the bank will do is carry out a credit check on you.
If you have debt problems and have missed payments, your credit rating is likely to be poor. If this is the case, you will fail the bank’s credit check, and your application will be refused.
If you believe that your credit rating is poor, you should be up front about this.
When you speak to a bank, tell them that you may not pass their standard credit check and so you require a simple bank account with no credit facilities.
This type of account is often known as a basic account or a card cash account. Many high street banks offer a basic bank account facility which they will open for you without needing to pass a standard credit check.
No credit facilities
A basic bank account will allow you to set up standing orders and direct debits. However, the downside is that you will not be offered credit facilities such as an overdraft.
Another problem with many basic accounts is that you will not be given a debit card.
Some basic bank accounts such as the Co-Op cash minder do offer a debit card facility. However if the bank you have chosen does not, you can consider getting a pre-paid debit card.
Pre-paid debit card
A pre-paid card operates in exactly the same way as a pay as you go mobile phone. You can only use the card if you have available credit. You increase the credit on the card by paying money into the card account.
Pre-paid cards are very useful for those unable to get a normal debit card.
They reduce the need for carrying large amounts of cash and enable you to do your shopping on line.
However, the downside is they can be costly to use as a fee is charged each time money is credited to the card and for cash withdrawals.
If you need to change your banking facilities but believe that your credit rating is poor, it will be possible to open a new account. You just need to go about the application in the right way.
You should be up front in asking for a basic account and must not expect to be offered credit facilities.
Remember to look for a bank which offers a debt card with their basic account. This will be a cheaper solution than paying for a pre-paid card if you decide to apply for one later.
8 Ways To Spot Loan Modification Scams
8 Ways To Spot Loan Modification Scams by Mortgage Assistance Group
The foreclosure crisis is still effecting a large part of our economic return to normalcy and it seems government help and lender assistance hasn’t exactly cured been able to promote a equitable and attainable solution for the average homeowner who may be facing foreclosure.
For this reason, many homeowners are “fixing” a private market problem, with a private market solution. That is that they are hiring professional debt negotiators to restructure their current loans so that they can stop foreclosure and keep their homes.
In order to reduce the foreclosure epidemic, states like California have implemented strict guidelines for modification companies to abide by. The loan modification industry as a whole however is still tainted with “pop up” expert modification companies who are here today and gone tomorrow.
We wanted to take the time to educate those who are searching for help and may not be able to tell a “good company” from a “bad” one.
If the company passes this list and you can afford their service fee, chances are your keeping your home.
Avoid loan modification scams by making sure the company you hire has…
1. Where Are They – A physical address, not a po box, and in an office complex or shopping center. You don’t want to do business with a company that is in a house or garage do you?
2. Credentials – Check to see if the company is registered with agencies such as the Better Business Bureau, this will ensure that any bad behaviour will be public and hopefully the rating in the B range or above.
3. Refunds - A money back refund of some type, even if it is partial is a good thing. Now hopefully you will not have to excercise this right and you will get what you paid for, a loan modification. Having something to fall back on protects your best interests.
4. I Fought The Law, With The Law - An on staff attorney, this is a plus, this person will ensure that the company processing your modification follows regulatory laws and guidelines and may even assist with negotiating on your case.
5. Who Did You Hire – Be sure the company you hire uses in house processors and negotiators. Why? Because all to often many companies will outsource your file to yet another company to do the dirty work and this leaves room for getting lost in translation. Some companies may have even set up a customer service department that will touch base with you as your file progresses.
6. Longevity – Although a loan modification is nothing new, the process has become more popular as the economy took a turn just over 2 years ago. So how long have they been in business. Two years or more? This tells you that they have the knowledge and experience to handle your file and that they have done been homeowners a service and saved their homes. You don’t want to hire an inexperience fly-by-night company to deal with your most important assets do you?
7. Ma’am Your New Payment is $552.01 a Month – Trained mortgage modification specialists that will answer any questions you may have however WILL NOT GUARANTEE SPECIFIC RESULTS. This is because they simply can not. Only the lender can dictate the end interest rate, payment and terms. For example if a company promises you an interest rate of 4%, at a new monthly payment of $601.01 and a principal reduction of $12,543, RUN FOR THE HILLS.
8. Payment Options – A good sign that you’re dealing with a legitimate company is if they offer flexible payment options. Either pay-as-you go or partial down payment help. If the company your speaking has a fee of $3995 and does not offer any type of payment options, this could be a sign of fraud or poor customer service. We are in a recession you know and homeowners shouldn’t have to go broke just to get help. Most homeowners understand that a company needs to collect a fee of some type to keep the doors open but simply cannot afford to pay so much up front.
The foreclosure crisis is still effecting a large part of our economic return to normalcy and it seems government help and lender assistance hasn’t exactly cured been able to promote a equitable and attainable solution for the average homeowner who may be facing foreclosure.
For this reason, many homeowners are “fixing” a private market problem, with a private market solution. That is that they are hiring professional debt negotiators to restructure their current loans so that they can stop foreclosure and keep their homes.
In order to reduce the foreclosure epidemic, states like California have implemented strict guidelines for modification companies to abide by. The loan modification industry as a whole however is still tainted with “pop up” expert modification companies who are here today and gone tomorrow.
We wanted to take the time to educate those who are searching for help and may not be able to tell a “good company” from a “bad” one.
If the company passes this list and you can afford their service fee, chances are your keeping your home.
Avoid loan modification scams by making sure the company you hire has…
1. Where Are They – A physical address, not a po box, and in an office complex or shopping center. You don’t want to do business with a company that is in a house or garage do you?
2. Credentials – Check to see if the company is registered with agencies such as the Better Business Bureau, this will ensure that any bad behaviour will be public and hopefully the rating in the B range or above.
3. Refunds - A money back refund of some type, even if it is partial is a good thing. Now hopefully you will not have to excercise this right and you will get what you paid for, a loan modification. Having something to fall back on protects your best interests.
4. I Fought The Law, With The Law - An on staff attorney, this is a plus, this person will ensure that the company processing your modification follows regulatory laws and guidelines and may even assist with negotiating on your case.
5. Who Did You Hire – Be sure the company you hire uses in house processors and negotiators. Why? Because all to often many companies will outsource your file to yet another company to do the dirty work and this leaves room for getting lost in translation. Some companies may have even set up a customer service department that will touch base with you as your file progresses.
6. Longevity – Although a loan modification is nothing new, the process has become more popular as the economy took a turn just over 2 years ago. So how long have they been in business. Two years or more? This tells you that they have the knowledge and experience to handle your file and that they have done been homeowners a service and saved their homes. You don’t want to hire an inexperience fly-by-night company to deal with your most important assets do you?
7. Ma’am Your New Payment is $552.01 a Month – Trained mortgage modification specialists that will answer any questions you may have however WILL NOT GUARANTEE SPECIFIC RESULTS. This is because they simply can not. Only the lender can dictate the end interest rate, payment and terms. For example if a company promises you an interest rate of 4%, at a new monthly payment of $601.01 and a principal reduction of $12,543, RUN FOR THE HILLS.
8. Payment Options – A good sign that you’re dealing with a legitimate company is if they offer flexible payment options. Either pay-as-you go or partial down payment help. If the company your speaking has a fee of $3995 and does not offer any type of payment options, this could be a sign of fraud or poor customer service. We are in a recession you know and homeowners shouldn’t have to go broke just to get help. Most homeowners understand that a company needs to collect a fee of some type to keep the doors open but simply cannot afford to pay so much up front.
What Kind Of Bank You Should Opt For Finance In India
Even bigger banks have no escape with the financial crises that are experiencing right now. You will think many times before deciding what bank you should trust for your finances. When it comes to India, there is different banking systems that you are opt to try for all your banking needs. Indian banking is practice in different sectors that gives more options where to deposit your money.
The two major divisions of banks in India are categorized into private banks and public banks Private banks in India are in the industry for quite sometime now. In fact, private banking is the practice from different parts of India. This takes place during the beginning of the banking systems in the country. With the boost of banking system in India, there are well-known banks in the private sectors that are internationally recognized. Private banks are recognized by the quality banking services and standards. These banks are opting to serve the people at the best quality they can give. With the systems they are implementing, private banks have bright future ahead of the crises experienced all over the world.
On the contrary, there are also public sectors banks that you may want to try. This PSU banks are those banks that were nationalized banks in India. When we say nationalized, that means it started as private banks that turns to be under the control of the government. The major benefits of this kind of bank are that you know that the government is on your side. There are many public sectors banks that you can try in India; some of this includes United Bank of India, Oriental Bank of Commerce and Central Bank of India. These banks are nationalized to serve the people in specific field of expertise and industries.
Whether private or public, it’s up to you to decide which bank you are going to try. Prior to your decision, make sure you check the bank’s profile. This will assure you the security of your finances. Avoid being bothered by the possibility of bankruptcy. Select the best bank that meets your requirements. Make sure to have the list and see which banks have it all for you. Banks depends on the depositors, so you better select depositors’ choice
The two major divisions of banks in India are categorized into private banks and public banks Private banks in India are in the industry for quite sometime now. In fact, private banking is the practice from different parts of India. This takes place during the beginning of the banking systems in the country. With the boost of banking system in India, there are well-known banks in the private sectors that are internationally recognized. Private banks are recognized by the quality banking services and standards. These banks are opting to serve the people at the best quality they can give. With the systems they are implementing, private banks have bright future ahead of the crises experienced all over the world.
On the contrary, there are also public sectors banks that you may want to try. This PSU banks are those banks that were nationalized banks in India. When we say nationalized, that means it started as private banks that turns to be under the control of the government. The major benefits of this kind of bank are that you know that the government is on your side. There are many public sectors banks that you can try in India; some of this includes United Bank of India, Oriental Bank of Commerce and Central Bank of India. These banks are nationalized to serve the people in specific field of expertise and industries.
Whether private or public, it’s up to you to decide which bank you are going to try. Prior to your decision, make sure you check the bank’s profile. This will assure you the security of your finances. Avoid being bothered by the possibility of bankruptcy. Select the best bank that meets your requirements. Make sure to have the list and see which banks have it all for you. Banks depends on the depositors, so you better select depositors’ choice
Anchorage Alaska
Anchorage, Alaska has many venues where musical artists perform, including concert venues and music festivals. While the city may not be known for a groundbreaking music scene, the wide variety of music one can find in Anchorage challenges even the most refined musical ears to listen. Pedestrians will find music in the streets through summer music festivals, and the city has at least three locations where popular musical acts come to play for thousands of attendees.
Visitors and residents of Anchorage will likely attend concerts in the Alaska Center for the Performing Arts, the Dena’ina Civic Center, or the William Egan Civic Center. These three locations handle a wide variety of music throughout the year. A concert can be had almost every weekend in Anchorage. Visitors also might find musical talent playing at the Anchorage Football Stadium or Mulcahy Stadium, as well as the Sullivan Arena, which usually plays host to sporting events with the occasional music concert.
In the summer months, the Alaska Pacific University hosts an Autumn Classics festival featuring many of the great chamber music ensembles. The Autumn Classics musical festival draws in thousands of listeners to listen to the chamber musical geniuses and hear the music played in an outdoor environment. In the winter months, the Anchorage Folk Festival captures the minds, hearts, and ears of Anchorage visitors and residents. The festival typically runs for ten days and can be found in various venues around the city of Anchorage. The Folk Festival features musical talents playing a variety of genres, including folk, jazz, klezmer, Celtic, and bluegrass, with a few surprises here and there. Attendees of this festival can also hear captivating stories from professional storytellers, view exotic dances, and see many groups perform traditional dances and songs in culturally significant ways.
On any given night in Anchorage Alaska, a music lover could hear the bellowing sounds of Opera coming from one of the many musical venues, listen to folk music at a local bar, bask in the lovely sounds of an orchestra, hear the strumming of a guitar on the street, inside a coffee shop, or in the lobby of a popular hotel. Anchorage has a vibrant and growing musical community that endears itself to the musical connoisseur for its diversity and cultural relevance. The many different festivals and concert locations make this Alaska’s premier stop for high quality musical entertainment.
The city also caters to children with many sing-a-long type events and musical troops to entertain, delight, and interest the younger generation. The Alaska Zoo puts on many of these events. Be sure to check out the Anchorage music section to view the wide variety of musical festivals, concerts, and venues around the city. If you attend one of these events, please let us know your thoughts, reactions, criticisms, and anything else you can provide. We always love to hear about the musical quality Anchorage offers.
Visitors and residents of Anchorage will likely attend concerts in the Alaska Center for the Performing Arts, the Dena’ina Civic Center, or the William Egan Civic Center. These three locations handle a wide variety of music throughout the year. A concert can be had almost every weekend in Anchorage. Visitors also might find musical talent playing at the Anchorage Football Stadium or Mulcahy Stadium, as well as the Sullivan Arena, which usually plays host to sporting events with the occasional music concert.
In the summer months, the Alaska Pacific University hosts an Autumn Classics festival featuring many of the great chamber music ensembles. The Autumn Classics musical festival draws in thousands of listeners to listen to the chamber musical geniuses and hear the music played in an outdoor environment. In the winter months, the Anchorage Folk Festival captures the minds, hearts, and ears of Anchorage visitors and residents. The festival typically runs for ten days and can be found in various venues around the city of Anchorage. The Folk Festival features musical talents playing a variety of genres, including folk, jazz, klezmer, Celtic, and bluegrass, with a few surprises here and there. Attendees of this festival can also hear captivating stories from professional storytellers, view exotic dances, and see many groups perform traditional dances and songs in culturally significant ways.
On any given night in Anchorage Alaska, a music lover could hear the bellowing sounds of Opera coming from one of the many musical venues, listen to folk music at a local bar, bask in the lovely sounds of an orchestra, hear the strumming of a guitar on the street, inside a coffee shop, or in the lobby of a popular hotel. Anchorage has a vibrant and growing musical community that endears itself to the musical connoisseur for its diversity and cultural relevance. The many different festivals and concert locations make this Alaska’s premier stop for high quality musical entertainment.
The city also caters to children with many sing-a-long type events and musical troops to entertain, delight, and interest the younger generation. The Alaska Zoo puts on many of these events. Be sure to check out the Anchorage music section to view the wide variety of musical festivals, concerts, and venues around the city. If you attend one of these events, please let us know your thoughts, reactions, criticisms, and anything else you can provide. We always love to hear about the musical quality Anchorage offers.
alternative for banks, overdrafts, chequesystems
You've just gotten home from work and you're going through the day's mail just before dinner. There's a letter from your bank. You know what it is before you open it because you recognize the packaging, it's oh so familiar. Your bank is writing to inform you that your account is overdrawn and of the fees assessed. There's more...
There's a second letter, also from your bank. This one states the fact that due to unpaid fees and a "lingering" negative balance your account has been closed and your name and account info have been reported to Chexsystems.
Overdraft Item fees are usually charged when a customer writes a check or makes a withdrawal of some sort (most times with ATM, debit or check cards) that exceeds the balance in the their checking or savings account. Overdrafts could occur for any number of reasons.
A couple of those are... Intentional short-term loan: Occurs when the account holder finds themselves short of money and knowingly makes an insufficient-funds debit. They accept the associated fees and cover the overdraft with their next deposit; Failure to maintain an accurate account register: The account holder doesn't accurately account for activity on their account and overspends through negligence. These are some customer caused reasons for overdrafts.
However, there are overdraft fees charged to customers for causes which may not be entirely the customer's fault. Meaning, there were no "intentional actions" on the customer's part to provoke the OD. A couple of these reasons are... Bank fees: The bank charges a fee unexpected to the account holder, leaving insufficient funds for a subsequent debit from the same account.
Temporary Deposit Hold: A deposit made to the account can be placed on hold by the bank. This may be due to Regulation CC (which governs the placement of holds on deposited checks) or due to individual bank policies. The funds may not be immediately available and lead to overdraft fees.
Bank strategies are driving up fees, practices which are condoned by regulators, explains Kathleen Day, a spokesperson for the Center for Responsible Lending, a non-partisan research center. Regulators deem these overdrafts fees, not small loans, so charges don't come under the Truth and Lending Act.
Banks can charge whatever fees the market will bear. In reality, consumers are in fact taking out a small loan and fees should be constrained and regulated just as in any lending arrangement, Day says.
According to The New York Times, US-based banks earned $27 billion from consumers for debit and other card overdraft fees in 2008. One consumer paid $102 in fees for three incidental debit card purchases because his account was overdrawn, turning his $4 café latte into a beverage costlier than many champagnes.
The banks solution to this problem of excessive fees... Overdraft Protection, which is the solution with a thousand downsides. Overdraft protection works in this manner, if your checking account runs short of available funds to cover checks you've written or other debits, Overdraft Protection automatically advances funds from another source i.e. savings account, line of credit or credit card. This sounds good at face value but looking deeper into it you will find "not so".
Overdraft protection (as long as you have an alternate funding source) does insure you won't assess overdraft fees, but the catch is you're going to pay for it! The fees vary according to the financial institution and the type of overdraft protection you have. Regardless of factors previously stated this is still not a solution I would vie for. Why...? Overdraft protection could also prove to be very costly. This is done with the click of a button so why should it cost you anything!
Most consumers fail to recognize that they can opt out of overdraft agreements, says Robert Manning, author of Credit Card Nation. Many people don't even know they'll be subjected to overdraft charges so the minute a fee is triggered, go to your bank and opt out. Unlike credit cards, debit card overdraft agreements are fluid and can be terminated at any point.
This is clearly one solution to the problem but in my opinion, not the best. There are others but I won't bore you with those... The one viable solution to combat these fees is to correctly balance your account so that its never overdrawn. However, this is most often easier said than done. Customers don't need overdraft protection, they need overdraft prevention.
Customers need debit accounts that assure them they absolutely will not overdraw their accounts. Prepaid debit cards insure this! With prepaid debit cards you only spend what you have and nothing more. Personally I found this to be the most excellent choice to relieve one of bank fees. I don't want them getting rich off of me anymore said one group of paneled consumers.
With most prepaid debit cards, you can do everything you could as with any bank issued debit card or checking account bt in no way going into debt. To find out more about the benefits of using prepaid debit cards as a viable checking account alternative ßclick the highlighted text.
There's a second letter, also from your bank. This one states the fact that due to unpaid fees and a "lingering" negative balance your account has been closed and your name and account info have been reported to Chexsystems.
Overdraft Item fees are usually charged when a customer writes a check or makes a withdrawal of some sort (most times with ATM, debit or check cards) that exceeds the balance in the their checking or savings account. Overdrafts could occur for any number of reasons.
A couple of those are... Intentional short-term loan: Occurs when the account holder finds themselves short of money and knowingly makes an insufficient-funds debit. They accept the associated fees and cover the overdraft with their next deposit; Failure to maintain an accurate account register: The account holder doesn't accurately account for activity on their account and overspends through negligence. These are some customer caused reasons for overdrafts.
However, there are overdraft fees charged to customers for causes which may not be entirely the customer's fault. Meaning, there were no "intentional actions" on the customer's part to provoke the OD. A couple of these reasons are... Bank fees: The bank charges a fee unexpected to the account holder, leaving insufficient funds for a subsequent debit from the same account.
Temporary Deposit Hold: A deposit made to the account can be placed on hold by the bank. This may be due to Regulation CC (which governs the placement of holds on deposited checks) or due to individual bank policies. The funds may not be immediately available and lead to overdraft fees.
Bank strategies are driving up fees, practices which are condoned by regulators, explains Kathleen Day, a spokesperson for the Center for Responsible Lending, a non-partisan research center. Regulators deem these overdrafts fees, not small loans, so charges don't come under the Truth and Lending Act.
Banks can charge whatever fees the market will bear. In reality, consumers are in fact taking out a small loan and fees should be constrained and regulated just as in any lending arrangement, Day says.
According to The New York Times, US-based banks earned $27 billion from consumers for debit and other card overdraft fees in 2008. One consumer paid $102 in fees for three incidental debit card purchases because his account was overdrawn, turning his $4 café latte into a beverage costlier than many champagnes.
The banks solution to this problem of excessive fees... Overdraft Protection, which is the solution with a thousand downsides. Overdraft protection works in this manner, if your checking account runs short of available funds to cover checks you've written or other debits, Overdraft Protection automatically advances funds from another source i.e. savings account, line of credit or credit card. This sounds good at face value but looking deeper into it you will find "not so".
Overdraft protection (as long as you have an alternate funding source) does insure you won't assess overdraft fees, but the catch is you're going to pay for it! The fees vary according to the financial institution and the type of overdraft protection you have. Regardless of factors previously stated this is still not a solution I would vie for. Why...? Overdraft protection could also prove to be very costly. This is done with the click of a button so why should it cost you anything!
Most consumers fail to recognize that they can opt out of overdraft agreements, says Robert Manning, author of Credit Card Nation. Many people don't even know they'll be subjected to overdraft charges so the minute a fee is triggered, go to your bank and opt out. Unlike credit cards, debit card overdraft agreements are fluid and can be terminated at any point.
This is clearly one solution to the problem but in my opinion, not the best. There are others but I won't bore you with those... The one viable solution to combat these fees is to correctly balance your account so that its never overdrawn. However, this is most often easier said than done. Customers don't need overdraft protection, they need overdraft prevention.
Customers need debit accounts that assure them they absolutely will not overdraw their accounts. Prepaid debit cards insure this! With prepaid debit cards you only spend what you have and nothing more. Personally I found this to be the most excellent choice to relieve one of bank fees. I don't want them getting rich off of me anymore said one group of paneled consumers.
With most prepaid debit cards, you can do everything you could as with any bank issued debit card or checking account bt in no way going into debt. To find out more about the benefits of using prepaid debit cards as a viable checking account alternative ßclick the highlighted text.
E Gold Investments: Investing Smartly With E-Currency Exchange
Investors are now starting to move their investments to the most recent investment trend: Making money with E-gold.
When you make an investment in E gold is a all about a profitable system that allows you to capitalize from the money that is moved through online transactions everyday. The process that is going on when you are trading e-Gold (or e-currencies) is providing the support for online cash. But let me back up the cassette. What am I trying to say by "support for online cash"?
A cash flow exists for all of the cash that is managed all over the internet every day. Nevertheless, all of this cashflow has, for every single cent that goes through a movement, a tangible support of that cent.
I'm providing a superficial explanation about how the dxgold formula operates, but to be more direct about it, to profit from it, it's not neccessary to know entirely how it works to capitalize from it. If I were to explain the dxgold expert Training Videos into other words I could say it's very much like driving a vehicle. It's not a requirement to comprehend how it operates in order to use it right.
The one thing you need to know is the e ecurrency trading process and every step of the way. This may sound complex, but once someone teaches you how to do it (like from a e trading course), it becomes so simple that takes no more than an hour a week total.
Starting your portfolio in e Gold is one thing I will say with all confidence that is a wonderful investment strategy, if you are building an income in the medium run.
It may not be as fast as a wall street stock, it it won't be something that will duplicate the money you invested in a day, but surely it is one of those few opportunities You and I can rely on to generate a real residual income from. And the distinctive message in that earlier phrase would be that you can Be safely assured, because this is a controlled medium term program that is insured to generate you cash.
This is why I personally think it is throwing money away not not learning this dxinone exchanging business. People doing this system even are aware of what percentage over your investment you will produce every day before you begin when you E Gold Invest.
For some people it could not be easy, but taking apart somewhere around $200 bucks and making money in egold must become a super wise decision. As many investors of all types are experiencing already, trading ecurrencies might potentially become a "paws off" 2nd income without the 8 to 5 job.
When you make an investment in E gold it becomes on self discipline. It becomes all around the self discipline of having your cash produce more money for you and allowing it develop, without developing an urge of a shopping spree and taking your money out of your e trading account.
Whenever you know you can hold off for a couple months and are motivated in having a second income, then the e gold investing system may be a perfect fit for you.
When you make an investment in E gold is a all about a profitable system that allows you to capitalize from the money that is moved through online transactions everyday. The process that is going on when you are trading e-Gold (or e-currencies) is providing the support for online cash. But let me back up the cassette. What am I trying to say by "support for online cash"?
A cash flow exists for all of the cash that is managed all over the internet every day. Nevertheless, all of this cashflow has, for every single cent that goes through a movement, a tangible support of that cent.
I'm providing a superficial explanation about how the dxgold formula operates, but to be more direct about it, to profit from it, it's not neccessary to know entirely how it works to capitalize from it. If I were to explain the dxgold expert Training Videos into other words I could say it's very much like driving a vehicle. It's not a requirement to comprehend how it operates in order to use it right.
The one thing you need to know is the e ecurrency trading process and every step of the way. This may sound complex, but once someone teaches you how to do it (like from a e trading course), it becomes so simple that takes no more than an hour a week total.
Starting your portfolio in e Gold is one thing I will say with all confidence that is a wonderful investment strategy, if you are building an income in the medium run.
It may not be as fast as a wall street stock, it it won't be something that will duplicate the money you invested in a day, but surely it is one of those few opportunities You and I can rely on to generate a real residual income from. And the distinctive message in that earlier phrase would be that you can Be safely assured, because this is a controlled medium term program that is insured to generate you cash.
This is why I personally think it is throwing money away not not learning this dxinone exchanging business. People doing this system even are aware of what percentage over your investment you will produce every day before you begin when you E Gold Invest.
For some people it could not be easy, but taking apart somewhere around $200 bucks and making money in egold must become a super wise decision. As many investors of all types are experiencing already, trading ecurrencies might potentially become a "paws off" 2nd income without the 8 to 5 job.
When you make an investment in E gold it becomes on self discipline. It becomes all around the self discipline of having your cash produce more money for you and allowing it develop, without developing an urge of a shopping spree and taking your money out of your e trading account.
Whenever you know you can hold off for a couple months and are motivated in having a second income, then the e gold investing system may be a perfect fit for you.
"How To" Start Trading The Forex Market?
What are *PIPS* ?
Currencies are traded on a price/ point (pip) system. Each currency pair has its own pip value.
When you see a FOREX price quote, you'll see something listed like this:
EUR/USD 1.2210/13
Explanation:
a) If you want to BUY the EUR/USD ( meaning you BUY EUROS and SELL US$ ) you buy 100,000 EUROS and you SELL 122,130 US$, or in other words you receive 122,130 US$ for 100,000 EUROS.
B) If you want to SELL the EUR/USD ( meaning you SELL EUROS and BUY US$ ) you buy 122,100 US$ and sell 100,000 EUROS, or in other words you receive 100,000 EUROS for 122,100 US$.
The difference between the bid and the ask price is referred to as the spread. In the example above, the spread is 3 or 3 pips.
Since the US dollar is the centerpiece of the FOREX market, it is normally considered the 'base' currency for quotes. In the "Majors", this includes USD/JPY, USD/CHF and USD/CAD. For these currencies and many others, quotes are expressed as a unit of $1 USD per the second currency quoted in the pair.
For example a quote of USD/CHF 1.3000 means that fore one U.S. dollar you receive 1.30 Swiss Francs. or in other words, you receive 1.30 Swiss Franc for each 1 US$.
When the U.S. dollar is the base unit and a currency quote goes up, it means the dollar has appreciated in value and the other currency has weakened. If the USD/CHF quote above increases to 1.3050 the dollar is stronger because it will now buy more Swiss Franc than before.
The three exceptions to this rule are the British pound (GBP), the Australian dollar (AUD) and the Euro (EUR). In these cases, you might see a quote such as EUR/USD 1.2080, meaning that for EURO you receive 1.2080 U.S. Dollars.
In these three currency pairs, where the U.S. dollar is not the base rate, a rising quote means a weakening dollar, as it now takes more U.S. dollars to equal one Euro, British pound or an Australian dollar.
In other words, if a currency quote goes higher, that increases the value of the base currency. A lower quote means the base currency is weakening.
Currency pairs that do not involve the U.S. dollar are called cross currencies, but the calculation is the same. For example, a quote of EUR/JPY 134.50 signifies that one Euro is equal to 134.50 Japanese yen.
HOW TO BUY ( going " LONG ")and SELL ( going " SHORT ") in the FOREX Market?
Keep in mind 2 very important rules:
RULE # 1) Cut your LOOSING trades and let your WINNING trades RUN
YOU WILL HAVE LOSING TRADES. Every FOREX trader has. The secret is, that a consistent, disciplined trader, at the end of the day, adds up more winning trades than losing trades.
When you and see on your charts, without any doubt, that you are in a losing trade, don't keep losing money. Most of the novice traders are lowering their stop loss just to "prove they are right" or "hoping that the market will reverse". 99% of these trades, are ending up with more losses. Most of the profitable trades are usually "right" immediately.
Remember, smart traders know there are many other opportunities. CUT your losses short and compound those winning positions.
RULE 2) NEVER EVER trade FOREX without placing a Stop Loss Order.
PLACE a STOP order, right along with your ENTRY order, via your online trading station, to prevent potential losses.
Before initiating any trade, you have to calculate at what point ( price) you would be wrong, because the market changed direction, and would want to cut your losses.
To make profits, in the FOREX, a trader can enter the market with a *buy position* (known as going "long") or a *sell position* (known as going "short").
As an example let's assume you've been studying the EURO. The EURO is paired first with the U.S. dollar or USD.
Your trading methods, rules, strategies, etc., tell you that the EURO will rice in the next 2 weeks, So you buy the EUR/USD pair meaning you will simultaneously buy EUROS, and SELL dollars).
You open up your excellent trading station software (provided to you for free by Fenix Capital Management, LLC http://www.fenixcapitalmanagement.com/ ) and you see that the EUR/USD pair is trading at:
EUR/USD: 1.2010/1.2013
As you you believe that the market price for the EUR/USD pair will go higher, you will enter a *buy position* in the market.
As an example, lets say you bought one lot EUR/USD at 1.2013. As long as you sell back the pair at a higher price, then you make money.
To illustrate a typical FX SELL trade, consider this scenario involving the USD/JPY currency pair:
REMEMBER Selling ("going short") the currency pair implies selling the first, base currency, and buying the second, quote currency. You sell the currency pair if you believe the base currency (USD) will go down relative to the quote currency (JPY), or equivalently, that the quote currency (JPY) will go up relative to the base currency (USD).
HOW TO CALCULATE PROFIT OR LOSS?
The Profit Calculations, on the Short-sell trade scenario below, may seem somewhat complicated if you've never been in the FOREX market before, but this process is continually calculated through your broker trade station (software). I show you this process below so you can SEE how a PROFIT might occur.
The current bid/ask price for USD/JPY is 107.50/107.54, meaning you can buy $1 US for 107.54 YEN, or sell $1 US for 107.50 YEN.
Suppose you think that the US Dollar (USD) is overvalued against the YEN (JPY). To execute this strategy, you would sell Dollars (simultaneously buying YEN), and then wait for the exchange rate to rise.
Your trade would be the following: you sell 1 lot USD (US $100,000) and you buy 1 lot JPY (10,754.000 YEN). (Remember, at 0.25 % margin, your initial margin deposit for this trade would be $ 250.)
As you expected, USD/JPY falls to 106.50/106.54, meaning you can now buy $1 US for $106.54 Japanese YEN or sell $1 US for 106.50.
Since you're short dollars (and are long YEN), you must now buy dollars and sell back the YEN to realize any profit.
You buy US $100,000 at the current USD/JPY rate of 106.54, and receive 10,654,000 YEN. Since you originally bought (paid for) 10,754,000 YEN, your profit is 100,000 YEN.
To calculate your P&L in terms of US dollars, divide 100,000 by the current USD/JPY rate of 106.54
Total profit = US $938.61
Currencies are traded on a price/ point (pip) system. Each currency pair has its own pip value.
When you see a FOREX price quote, you'll see something listed like this:
EUR/USD 1.2210/13
Explanation:
a) If you want to BUY the EUR/USD ( meaning you BUY EUROS and SELL US$ ) you buy 100,000 EUROS and you SELL 122,130 US$, or in other words you receive 122,130 US$ for 100,000 EUROS.
B) If you want to SELL the EUR/USD ( meaning you SELL EUROS and BUY US$ ) you buy 122,100 US$ and sell 100,000 EUROS, or in other words you receive 100,000 EUROS for 122,100 US$.
The difference between the bid and the ask price is referred to as the spread. In the example above, the spread is 3 or 3 pips.
Since the US dollar is the centerpiece of the FOREX market, it is normally considered the 'base' currency for quotes. In the "Majors", this includes USD/JPY, USD/CHF and USD/CAD. For these currencies and many others, quotes are expressed as a unit of $1 USD per the second currency quoted in the pair.
For example a quote of USD/CHF 1.3000 means that fore one U.S. dollar you receive 1.30 Swiss Francs. or in other words, you receive 1.30 Swiss Franc for each 1 US$.
When the U.S. dollar is the base unit and a currency quote goes up, it means the dollar has appreciated in value and the other currency has weakened. If the USD/CHF quote above increases to 1.3050 the dollar is stronger because it will now buy more Swiss Franc than before.
The three exceptions to this rule are the British pound (GBP), the Australian dollar (AUD) and the Euro (EUR). In these cases, you might see a quote such as EUR/USD 1.2080, meaning that for EURO you receive 1.2080 U.S. Dollars.
In these three currency pairs, where the U.S. dollar is not the base rate, a rising quote means a weakening dollar, as it now takes more U.S. dollars to equal one Euro, British pound or an Australian dollar.
In other words, if a currency quote goes higher, that increases the value of the base currency. A lower quote means the base currency is weakening.
Currency pairs that do not involve the U.S. dollar are called cross currencies, but the calculation is the same. For example, a quote of EUR/JPY 134.50 signifies that one Euro is equal to 134.50 Japanese yen.
HOW TO BUY ( going " LONG ")and SELL ( going " SHORT ") in the FOREX Market?
Keep in mind 2 very important rules:
RULE # 1) Cut your LOOSING trades and let your WINNING trades RUN
YOU WILL HAVE LOSING TRADES. Every FOREX trader has. The secret is, that a consistent, disciplined trader, at the end of the day, adds up more winning trades than losing trades.
When you and see on your charts, without any doubt, that you are in a losing trade, don't keep losing money. Most of the novice traders are lowering their stop loss just to "prove they are right" or "hoping that the market will reverse". 99% of these trades, are ending up with more losses. Most of the profitable trades are usually "right" immediately.
Remember, smart traders know there are many other opportunities. CUT your losses short and compound those winning positions.
RULE 2) NEVER EVER trade FOREX without placing a Stop Loss Order.
PLACE a STOP order, right along with your ENTRY order, via your online trading station, to prevent potential losses.
Before initiating any trade, you have to calculate at what point ( price) you would be wrong, because the market changed direction, and would want to cut your losses.
To make profits, in the FOREX, a trader can enter the market with a *buy position* (known as going "long") or a *sell position* (known as going "short").
As an example let's assume you've been studying the EURO. The EURO is paired first with the U.S. dollar or USD.
Your trading methods, rules, strategies, etc., tell you that the EURO will rice in the next 2 weeks, So you buy the EUR/USD pair meaning you will simultaneously buy EUROS, and SELL dollars).
You open up your excellent trading station software (provided to you for free by Fenix Capital Management, LLC http://www.fenixcapitalmanagement.com/ ) and you see that the EUR/USD pair is trading at:
EUR/USD: 1.2010/1.2013
As you you believe that the market price for the EUR/USD pair will go higher, you will enter a *buy position* in the market.
As an example, lets say you bought one lot EUR/USD at 1.2013. As long as you sell back the pair at a higher price, then you make money.
To illustrate a typical FX SELL trade, consider this scenario involving the USD/JPY currency pair:
REMEMBER Selling ("going short") the currency pair implies selling the first, base currency, and buying the second, quote currency. You sell the currency pair if you believe the base currency (USD) will go down relative to the quote currency (JPY), or equivalently, that the quote currency (JPY) will go up relative to the base currency (USD).
HOW TO CALCULATE PROFIT OR LOSS?
The Profit Calculations, on the Short-sell trade scenario below, may seem somewhat complicated if you've never been in the FOREX market before, but this process is continually calculated through your broker trade station (software). I show you this process below so you can SEE how a PROFIT might occur.
The current bid/ask price for USD/JPY is 107.50/107.54, meaning you can buy $1 US for 107.54 YEN, or sell $1 US for 107.50 YEN.
Suppose you think that the US Dollar (USD) is overvalued against the YEN (JPY). To execute this strategy, you would sell Dollars (simultaneously buying YEN), and then wait for the exchange rate to rise.
Your trade would be the following: you sell 1 lot USD (US $100,000) and you buy 1 lot JPY (10,754.000 YEN). (Remember, at 0.25 % margin, your initial margin deposit for this trade would be $ 250.)
As you expected, USD/JPY falls to 106.50/106.54, meaning you can now buy $1 US for $106.54 Japanese YEN or sell $1 US for 106.50.
Since you're short dollars (and are long YEN), you must now buy dollars and sell back the YEN to realize any profit.
You buy US $100,000 at the current USD/JPY rate of 106.54, and receive 10,654,000 YEN. Since you originally bought (paid for) 10,754,000 YEN, your profit is 100,000 YEN.
To calculate your P&L in terms of US dollars, divide 100,000 by the current USD/JPY rate of 106.54
Total profit = US $938.61
Betting Exchange Place Markets - Wise Up And Win
How To Use The Betting Exchange Place Markets To Your Advantage
Introduction
In article one, I introduced you to the Betting Exchange concept and explained the basics of LAY Betting (Lay to Lose). Now in this article, I'm going to introduce you to another unique and powerful feature of the betting exchanges, the Place Markets.
What Are Betting Exchange Place Markets?
Place markets are as the name suggests, markets which allow you to bet on a selection to be 'placed'. Eg. a horse to finish 1st, 2nd or 3rd in a 8 runner or larger field.
Now, the first and most important thing to highlight here is that these place markets are completely different to the well known Each Way (EW) betting markets offered by traditional bookmakers. The Each Way bet is in fact 2 bets of equal stakes. The 1st stake is on the selection to win and the 2nd is on it to be placed. So a £10 EW bet will cost you £20 in total.
A £10 place bet on a Betting Exchange is a single bet and therefore will only cost you £10. If your selection finishes in a place, you collect your winnings and smile.
Think about it for a minute. How many times have you been certain that a horse will be placed, but you have not been confident that it will win...
Traditional Each Way Betting
Take the following example. A horse named 'Im gonna be placed' that is available to back with traditional bookmakers at 4/1 (5.0). Your very confident that it will finish in the top 3 in a 10 runner field.
With a traditional bookmaker, your options are:
1) Take a chance on it winning and place a win single on it. E.g. £10 at 4/1
2) Place an EW bet on it. E.g. £10 EW at 4/1 (5.0). Total stakes £20. The bookies will pay you 1/5 odds on the place element of this E/W bet based on their standard EW rules. On our horse which is available to back at 5.0 this equates to 1.8
Now, the only time the above race will be profitable for you is if the horse actually wins. In both cases you would make a very nice profit if it did. For option 1 you would win £40 profit and for option 2, £48 profit.
BUT, if as you suspected the horse only finishes placed in 2nd or 3rd, you actually lose money in both cases. With option 1 you obviously lose all your stake money so are down £10. With option 2, you win £8 on the Place side of the EW bet but still lose £2 overall as the win part of the bet was a losing one.
Enter The Betting Exchange Place Markets
Using the above example and depending upon the prices of the other horses in the race, you would probably see the Betting Exchanges offering odds of around 1.60 - 2.00 (evens) on this horse being placed. You can therefore put your £10 PLACE bet on at say 1.8 and collect £8 profit (minus commission) as long as the horse finishes 1st, 2nd or 3rd. Only if the horse finishes outside of the top 3 do you lose your £10 stake.
I'm sure this has got you thinking and you can probably see the power in this straight away!
When combined with a good staking plan and a sensible selection process, it can be common to have very long winning streaks when backing horses to be placed on the betting exchanges. These longer winning streaks more than make up for the relatively short prices that are offered on selections to be placed.
Place Market Important Notes
A few important things to note about place markets:
1) Unlike the betting exchange win markets, Place markets DO NOT go "In-Running" when the race starts but this is true of the traditional E/W bets offered by bookies as well.
2) If a race is planned as a 8 runner or more event but a number of horses become non-runners leaving less than 8 runners, the betting exchanges still offer odds on 3 places. This is different to bookmakers who in such cases adjust their odds on the place payment from 1/5 to 1/4 of the win odds BUT they only pay out on 2 places. If a 5,6 or 7 runner field is shortened to less than 5 runners, the betting exchanges will still offer place markets and payout if the horse finishes 1st or 2nd.
3) You can make up the equivalent of an E/W bet on the betting exchanges by placing a bet on the win market and a separate bet on the place market. Depending upon the type of race and the form of the market, you will often find that this offers more value in terms of odds than an E/W bet with a bookmaker.
Backing Or Laying On The Place Markets
As explained in article 1, the ability to Lay a selection is perhaps the most important feature of the betting exchanges. You now have the ability to Lay selections to be placed. In other words, if you have a valid reason to believe that a selection will not even finish in a place, Lay it to Lose on a betting exchange. The real beauty of laying on the place markets, is that the odds are always much lower than the outright win odds so your lay liabilities are much lower.
Trading On The Place Markets
As the place market prices are much lower than the outright win market prices, they also offer a great place to learn the skill of TRADING without much risk to your balance! Betting Exchange trading is simply the process of betting on price movements for guaranteed profits. E.g. Back a horse at 4.0 and then Lay it later at 3.0 for a no risk bet or guaranteed profit regardless of the outcome!
Betting exchange trading will be covered in detail in a future betting article.
Summary
Place markets should be used as part of your betting armory. They offer you the chance to make money frequently with long winning streaks being very common. This helps to build your confidence as well as your betting bank!
Bookie Each Way bets are not always poor bets but in the vast majority of races, the odds are stacked firmly in the favour of the bookmakers. They simply love punters taking EW bets on these races as they know its their bread and butter. A small proportion of races where the market is formed in a certain way do offer the punter very good E/W value but that's for a different day...
Well that's it for part 2 of my betting exchange articles. In part 3, I will be explaining the Betting Exchange In-Running markets.
Introduction
In article one, I introduced you to the Betting Exchange concept and explained the basics of LAY Betting (Lay to Lose). Now in this article, I'm going to introduce you to another unique and powerful feature of the betting exchanges, the Place Markets.
What Are Betting Exchange Place Markets?
Place markets are as the name suggests, markets which allow you to bet on a selection to be 'placed'. Eg. a horse to finish 1st, 2nd or 3rd in a 8 runner or larger field.
Now, the first and most important thing to highlight here is that these place markets are completely different to the well known Each Way (EW) betting markets offered by traditional bookmakers. The Each Way bet is in fact 2 bets of equal stakes. The 1st stake is on the selection to win and the 2nd is on it to be placed. So a £10 EW bet will cost you £20 in total.
A £10 place bet on a Betting Exchange is a single bet and therefore will only cost you £10. If your selection finishes in a place, you collect your winnings and smile.
Think about it for a minute. How many times have you been certain that a horse will be placed, but you have not been confident that it will win...
Traditional Each Way Betting
Take the following example. A horse named 'Im gonna be placed' that is available to back with traditional bookmakers at 4/1 (5.0). Your very confident that it will finish in the top 3 in a 10 runner field.
With a traditional bookmaker, your options are:
1) Take a chance on it winning and place a win single on it. E.g. £10 at 4/1
2) Place an EW bet on it. E.g. £10 EW at 4/1 (5.0). Total stakes £20. The bookies will pay you 1/5 odds on the place element of this E/W bet based on their standard EW rules. On our horse which is available to back at 5.0 this equates to 1.8
Now, the only time the above race will be profitable for you is if the horse actually wins. In both cases you would make a very nice profit if it did. For option 1 you would win £40 profit and for option 2, £48 profit.
BUT, if as you suspected the horse only finishes placed in 2nd or 3rd, you actually lose money in both cases. With option 1 you obviously lose all your stake money so are down £10. With option 2, you win £8 on the Place side of the EW bet but still lose £2 overall as the win part of the bet was a losing one.
Enter The Betting Exchange Place Markets
Using the above example and depending upon the prices of the other horses in the race, you would probably see the Betting Exchanges offering odds of around 1.60 - 2.00 (evens) on this horse being placed. You can therefore put your £10 PLACE bet on at say 1.8 and collect £8 profit (minus commission) as long as the horse finishes 1st, 2nd or 3rd. Only if the horse finishes outside of the top 3 do you lose your £10 stake.
I'm sure this has got you thinking and you can probably see the power in this straight away!
When combined with a good staking plan and a sensible selection process, it can be common to have very long winning streaks when backing horses to be placed on the betting exchanges. These longer winning streaks more than make up for the relatively short prices that are offered on selections to be placed.
Place Market Important Notes
A few important things to note about place markets:
1) Unlike the betting exchange win markets, Place markets DO NOT go "In-Running" when the race starts but this is true of the traditional E/W bets offered by bookies as well.
2) If a race is planned as a 8 runner or more event but a number of horses become non-runners leaving less than 8 runners, the betting exchanges still offer odds on 3 places. This is different to bookmakers who in such cases adjust their odds on the place payment from 1/5 to 1/4 of the win odds BUT they only pay out on 2 places. If a 5,6 or 7 runner field is shortened to less than 5 runners, the betting exchanges will still offer place markets and payout if the horse finishes 1st or 2nd.
3) You can make up the equivalent of an E/W bet on the betting exchanges by placing a bet on the win market and a separate bet on the place market. Depending upon the type of race and the form of the market, you will often find that this offers more value in terms of odds than an E/W bet with a bookmaker.
Backing Or Laying On The Place Markets
As explained in article 1, the ability to Lay a selection is perhaps the most important feature of the betting exchanges. You now have the ability to Lay selections to be placed. In other words, if you have a valid reason to believe that a selection will not even finish in a place, Lay it to Lose on a betting exchange. The real beauty of laying on the place markets, is that the odds are always much lower than the outright win odds so your lay liabilities are much lower.
Trading On The Place Markets
As the place market prices are much lower than the outright win market prices, they also offer a great place to learn the skill of TRADING without much risk to your balance! Betting Exchange trading is simply the process of betting on price movements for guaranteed profits. E.g. Back a horse at 4.0 and then Lay it later at 3.0 for a no risk bet or guaranteed profit regardless of the outcome!
Betting exchange trading will be covered in detail in a future betting article.
Summary
Place markets should be used as part of your betting armory. They offer you the chance to make money frequently with long winning streaks being very common. This helps to build your confidence as well as your betting bank!
Bookie Each Way bets are not always poor bets but in the vast majority of races, the odds are stacked firmly in the favour of the bookmakers. They simply love punters taking EW bets on these races as they know its their bread and butter. A small proportion of races where the market is formed in a certain way do offer the punter very good E/W value but that's for a different day...
Well that's it for part 2 of my betting exchange articles. In part 3, I will be explaining the Betting Exchange In-Running markets.
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