According to analysts, a deep value stock can be defined as something which is low priced in relation to the margin of safety the stock provides, to limit losses when a mistake is made. Lets get some insight into how to identify these stocks, what should be your ideal portfolio allocation and reasons behind their low valuations in the market.

SLEEPING GIANTS

They are like any other stock traded on the exchange, but there is no hypothetical understanding of them. A section of traders on the Bombay Stock Exchange even call these stocks as ‘sleeping giants’.

There are two ways in which you can identify a deep value stock.

First, what Benjamin Graham recommends for the defensive investors in his 1949 classic – that the stock price should not be more than 15 times its average earnings per share over the past three years and the overall PE of the portfolio should not be more than 13. Or

Second, the stock should be trading below its 10-year median PE. The other things to be kept in mind is to stick with companies that have a long history of consistent profit growth and steady dividend payouts and the fact that not every cheap stock would turn out to be a bargain. He believes that PSU banks like Oriental Bank of Commerce, which is trading at a PE of 5.6 with book value of Rs 240 for FY09, is a perfect example of a deep value stock. “In a growing economy like India, banks should do well as the GDP expands,” he reasons.

These stocks generally remain neglected by the stock markets. The best (or you may call it worst) part is that people know it’s a great story but still they don’t want to touch it. If one saw the real estate boom in India five years back and bought into Unitech, his portfolio returns would have multiplied phenomenally.

As far as portfolio allocations are concerned, analysts feel that an investor could invest 80% in growth stocks and 20% in value stocks (after keeping some cash balance or investments in fixed income instruments). In case of a pure deep value investor, that typically 80% the investment of investible funds should be in these stocks and 20% of the funds should be kept aside for fixed income instruments or cash balance. “However, a hybrid investor should follow a strategy in between the two. The basic principle followed is the Pareto’s principle – the 80/20 rule.

SOW TO REAP

Though opinions differ on an ideal investment horizon, most analysts agree that it should not be less than a year and which could extend up to three to five years to reap big dividends. The first thing an investor needs to do is to ask himself whether he is a speculator or an investor. “If he is a speculator, then there is no chance for him to stay in these stocks. If he is an investor, a time period of three to five years is what makes sense. However, if the stock does not give the required return even after holding for three years, there is something more than one ’s own understanding about the stock. In such a scenario, you could sell the stock and move to something else. However, if there are compelling reasons, you could continue holding the stock.

On why these stocks have ridiculously low valuations the market sometimes tends to overlook an industry. And usually these stocks are not popular with brokers. Apart from that, analysts explain that there could be reasons such as high transaction impact costs (small caps can have transaction impact costs as high as 30-50% ) and fear of uncertain events or adverse macro environment conditions such as rise in oil and interest rates, government policies, etc. You must also understand that fear always resides in the near term. And that’s why there is lower visibility of the future even though the broad picture remains intact in these cases.

UNPOLISHED GEMS

Here are some deep value stocks which experts feel have great potential

ONGC – The stock is in a sector which is very strategic in nature, has a history of good profitability and dividends and trading at ridiculous valuations.

MAHINDRA & MAHINDRA AND MARUTI – The industry is in a growth phase in India as opposed to a saturation phase in the western world – trading at a PE of around 10 for FY09

LIC HOUSING FINANCE – A company growing at 25-30% available at a PE of 7x for FY09 and EPS of Rs 55. Book value of the company in FY09 would be Rs 260 and ROE would be 20% (Assuming no dilution)

BIRLA CORPORATION AND INDIA CEMENTS – Trading at single digit price multiples for FY09. Overall infrastructure spending is close to $500bn in the 12th five year plan and that we are nowhere close to capacities that exist in China

HDIL – It is trading at a considerable discount. The infrastructure sector has strong revenue visibility, and growth opportunity in the target markets with possible value unlocking opportunity.

SBI - The stock is trading at single digit multiple for FY10E. Apart from holding largest land bank holdings, it has an x-factor too – human resource valuation

For further related articles refer to http://prajnacapital.blogspot.com

Laptops or Cell Phones for Personal Use

If you’re planning to buy a laptop or cell phone for personal use, you’ll probably want all the latest features at the lowest cost. A mobile phone will typically be priced anywhere from $300 to $4,500, depending on its features, style, brand name, etc. A laptop computer is usually priced according to the amount of memory or disc space available, key features, pre-installed programs and the brand name. Laptops are priced anywhere from $1,000 to $10,000.

If purchasing a mobile phone or laptop that’s on the high end of the price scale, you’re looking at a fairly large investment. You may not have the cash on-hand at the date of purchase. When buying a notebook computer for personal use, consider the total purchase price, the interest rates that are available at your lending institution, and the number of years you will finance. Laptops can decrease in value quickly because computers are always changing – there’s always a new feature or type of computer on the market. In reality, your notebook computer could become obsolete within a year or two!

The same is true for cell phones. They tend to become obsolete quickly as well. On the other hand, paying a little more for a cell phone you know will enjoy for many years to come may be worth financing a higher amount.

For personal use, it is recommended to finance your mobile phone or laptop only if necessary, and at the lowest interest rate possible. You may be able to take advantage of a personal loan at your local bank or credit union. Finance companies tend to be much higher in interest. If you must pay high interest, be sure to lessen your finance payment period. You’ll pay much less interest by financing for two years instead of three.

Laptops or Cell Phones for Business Use

When buying products for business, financing can be a good thing. Sometimes, paying $5,000 cash is possible, but not wise. If you have $5,000 on-hand, you could use part of it as a down payment for your notebook computer or mobile phone. The remainder can be used to do more promotions for your business, thus, increasing your profits. Also, the finance charges and depreciation value of the laptop may be a helpful tax write-off at the year’s end! So by financing, you may be able to increase business profits, buy your much-needed equipment, and save on taxes!

Before financing products such as laptops or mobile phones, speak with your accountant to find out if it’s the right decision for you. The time of year, cost, interest rate and other factors will ultimately determine if financing will benefit or hurt your business.

Products like mobile phones and laptop computers are very useful for individuals and businesses. Consider the tips above before buying a laptop or cell phone to make your investment worthwhile!

Chris Robertson is an author of Majon International, one of the worlds MOST popular internet marketing companies on the web. Learn more about Financing Mobile Phones or Laptops

First of all, it’s important to note that the S&P 500 long-term growth averages fail to reach double digit levels. The only reason you see returns of between 11-12% are because of the dividends specific stocks within the index pay out. Without these dividends, the average return on the S&P 500 between the years of 1951 and 2001 (in ten year intervals) was only 9.49%.

The assertion that Dateline NBC and other critics put out there that index-linked products only credit about 60% of the upward movement of the stock market is merely a half-truth. What they’re not telling you is that index-linked products credit interest rates based on only the upward movement of the underlying index with the cap rates configured into the products.

If you’re not familiar with the way indexed-linked products work, you can find some useful information within the archives on my website, twintierfinancial.com. Essentially, every indexed product works the same in that they credit the policy in proportion to the upward only variations of the S&P 500, generally up to a pre-known cap of between 6-8%. Generally, the better the product, the higher the cap will be. Also, the better the product, the less the fees will be associated with it.

Now, let’s revisit the half-truth of the 60% return. The problem herein is that this figure is obtained by figuring in the down years of the index as well. The nature of indexed-linked products is that they treat the naturally occurring downward turns in the stock markets as no growth. In other words, the stock market might lose 5% in one month (quite like this year), but your indexed-linked product will simply credit 0% growth for that month, while still preserving the principal you already have.

By the time you substitute all the downward trending values with zeros, you’ll find that indexed products return a full 30% more than the 60% returns originally claimed by the critics. For well designed indexed products, the long-term honest rate of return is truthfully within the 8-9% range. Considering that the long-term average of the S&P is 9.49%, an 8% return with no downside risk doesn’t seem like a bad prospect at all, right?

Additionally, most indexed-linked products also have a minimum rate of return. In the shaky financial situation that the economy has been experiencing this year, the stock market has already lost 40% of its value from this time last year. However, the people who were secured into indexed-linked products have not only preserved their initial investment and the gains they’ve already secured, but they have also been credited between 1-3% depending on the minimum gains guarantee written into their product. Not too shabby.

David C Lewis, FMM, RFA is the founder of Twin Tier Financial – a financial services company based in upstate NY which specializes in providing information related to finance online, personal financial problems and retirement planning. For more info, please visit http://www.twintierfinancial.com

If you plan to invest your money through FOREX autopilot system, you need to do some searching. Some automated system charges you around $65 per month to use their program. Other than that, a minimum investment is required to participate in forex trading robot. However, forex trading system can reduce risk and improve over all system performance. Before you try on anything or decide to purchase a forex autopilot system you should consider the following:

1. You have to be sure that there is a free trial. Most of the forex autopilot system are offering free 8 weeks trial for you to see if the forex robot you purchased really work.

2. See if you can start with their demo account. This is really good specially if you are just new in the forex trading arena. Having a demo account allow you to trade even without investing any money. In this way you will see the performance of the system without risking any of your hard earned money.

3. Be sure that they are offering training, a video and helpful information on forex trading. Most of the trader failed because they don’t even know what they are doing. To be able to ensure profits, you must first start educating yourself. In this way you will know the pros and con of your action.

4. Make sure that the system that you have works in any trading platform. Trading platform is very important in forex market. It has a big contribution to the failure of a trader, the same thing with the forex signal.

5. Take note if the system has their own money back guarantee!

Maybe, you can have a better understanding of forex autopilot now. I hope that you can be successful in the near future. Deciding to choose from the different robot system is very difficult but if you will going to use the simple step I was mentioned above, I know you will find the system that fits your trading needs.

Find out more about Forex Autopilot System at : http://www.squidoo.com/forex-autopilot-system.

Hard money loans are very similar to bridge loans. Bridge loans typically have similar criteria for lending. They also have similar costs to the borrower. The primary difference between a hard money commercial loan and a bridge loan is that a bridge loan frequently refers to a commercial property or investment property that is in transition. The property may not fully qualify for traditional financing yet. Hard money commercial loans refer not only to asset-based loans with a high interest rate but also loans for a financial situation that is possible distressed. Examples of this include cases where someone is arrears on an existing mortgage or where bankruptcy and foreclosure proceedings are already in process.

Hard money mortgages, both commercial and residential, are made by private investors. They typically make loans only in their local areas. The credit score of the borrower is not important because the loan is secured by the value of the collateral property. The maximum loan to value ratio is 65-70%. This means that if a piece of property is worth $100,000, the lender would give the borrower $65,000 to $70,000. This low LTV (loan-to-value) ratio gives the lender added security in the event that the borrower cannot pay and the lender has to foreclose on the property.

Commercial hard money lender programs are similar to traditional hard money loans in terms of the LTV requirements and interest rates. A commercial hard money lender is typically a strong financial institution with the deposits and abilities to make discretionary decisions on loans that are non-conforming. These borrowers do not conform to the standards of Fannie Mae, Freddie Mac, or other residential conforming credit guidelines. Since it’s a commercial property in question, the loan does not generally conform to a standard commercial loan guideline either.

Traditional commercial hard money loans are very high risk and have a higher than average default rate. Just like in a normal commercial loan, when a property owner defaults on a commercial hard money loan, he or she can potentially lose the property to foreclosure.

For more information on hard money lending, please visit http://www.pitbullmortgageschool.com.

Joseph Devine

While currency trading is not a new idea, it has been only in recent years that this enormous market has really been open to small individual investors. This is an investment opportunity which is becoming more and more popular – and it can all be done from the comfort of your own home!

A lot of people are now looking for a way to get their own share of this market. While you can begin online Forex trading very quickly, there are a lot of things you should know before you take the plunge. For instance, how Forex trading works in online Forex trading, what you are doing is trading one currency for another on the prediction that the value of the currency you are buying will rise in value compared to the currency you are selling.

All Forex trades are done in pairs like this; so knowing the ups and downs of world economies is key. You will need to become acquainted with the market trends on the global currency market, but technology and the right software can help you learn. Many of these packages even allow you to create a test account so you can get your feet wet in the Forex world before you begin investing with real money. The potential profits on the Forex market are great – but so are the potential losses; that’s why it’s important to be well informed and ensure that you have done the proper analysis of the virtual trainload of data that should be analyzed before making a trade decision.

Fortunately, many tools exist to help you begin your online Forex trading career. There is a lot of software out there which can help you navigate market trends and make the kinds of well informed decisions necessary to succeed in this enormous global currency marketplace. As a newcomer to the currency exchange industry, you’ll find these tools extremely helpful as you learn the ins and outs of Forex trading. In fact, the right tool can be your best friend as you learn the market and start making successful and profitable trades.

Getting into online Forex trading without having the right tools is a lot like trying to canoe with no paddle; you’ll be on the water alright, but with no way to really get where you want to go. You should never get into any sort of investment without first becoming acquainted with how things work. Getting the right Forex trading software and proper instruction can make all the difference between making a killing on the foreign currency exchange market and losing your shirt. Learn everything you can about the market and use the right Forex trading tools before you jump into making trades; this will make you much better prepared to make the kind of well informed decisions which translate into big profits.

For more insights and additional information about getting started with Online Forex Trading as well as getting a major discount on one of the most intuitive and successful forex trading programs available today, please visit our web site at http://www.forexcurrencysystems.com

Margin trading allows you to make money on Forex with only the funds you have available. It is defined as trading with borrowed capital. In simpler terms, marginal trading taking a loan. Bear in mind that this could mean very high potential for upside profit but also high downside risks!

The first thing you have to do is find yourself a broker and open a margin account in which you will be using money you borrowed from a bank, a finance organization, or your broker as your initial capital. Making money with margin trading depends mainly on your guts and your predictions.

For example, you decide to open a margin account with $ 100,000. Using this amount along with the percentage of purchase price agreed upon by you and your broker, you will be able to buy money in another currency, say the Australian Dollar (AUD).

If you think that the AUD is showing promise and in a short span of time will be gaining strength against the US Dollar, you are going to spend your capital on the AUD.

Once the AUD to Dollar exchange rate climbs, you sell your AUD. This way, you have just invested little but got a good ROI (Return of Investment).

Be mindful, though, that margin trading is a risky practice. Before doing it, make sure that you are well-equipped with enough back-up money and experience.

Learn how to trade forex like the pros. See how you too can trade the markets with limited funds!

Here are the most common questions I hear about forex currency trading systems:

Q: What if I have never even tried the forex markets, is this going to work for me?

A: Of course! Forex currency trading systems are unlike other systems out there because they are designed to autopilot and help newbies and experienced traders alike. It’s actually quite easy to submerse yourself into the system to understand it within minutes.

Q: Do I need a large capital to start this program or to start trading?

A: This depends on which broker you use. Most people usually can start to trade with a nominal $500. Most people actually do get started with a small amount so they can see how the system works. Once they see the profits piling up they end up investing considerable sums to maximize their profits.

Q: Do I need a super computer for this kind of stuff?

A: This is a question that I hear all the time. The truth is all you really need is a reliable internet connection. If you have dsl or cable modem you will be on top of your game. All the heavy stuff is usually hosted wherever you get your forex currency trading system software from.

I hear plenty of questions about forex currency trading system because people really can’t grasp the ability they have to make large amounts of money without any knowledge. I know whenever the topic of investing comes up most people don’t think they have what it takes. The truth is that systems have been created to turn the most inexperienced investor into the next Warren Buffet.

Which forex currency trading system should I use?

http://www.squidoo.com/bestforexsoftwaretrading