Biz Direct MarketKnowing When To Make A Good Decision

Bonds or stocks? A nice investment this year has been the bric versus BRIC trade. Since I wrote about it, long Colombia/short China returned +50%, long Indonesia/short India +30%, Bangladesh bettered Brazil and Romania rose past Russia. Beta-neutral relative value emerging market strategies usually don’t make money on both sides. While economic expansion does NOT imply stock market growth, I’m more glad I didn’t tie up peoples’ cash in “risk free” cash. Long only? Too risky so I’ll leave others to chase the bond bubble. Absolute return is the SAFER alternative.

Seek alpha or bet on beta? Why does so much financial advice fixate on how much to allocate to various betas? The more “risk averse” the more in bonds? Is it sensible to recommend the same allocation at 1% yields as when they paid 10%? Can opportunity cost and default risk be ignored with coupons so low and borrowing so high? There are NO risk free bonds but at least higher yields did deliver the fixed-income on which so many individuals and institutions depend. Financial reform and regulation has as much chance of preventing the NEXT crash as ordering the ocean to stop rogue waves. Get sunk again OR benefit from them? Investors can choose.

Read the rest of this entry »

[This post is written and copyrighted by FIRE Finance (http://firefinance.blogspot.com).]
Updated Aug 26, 2010: Today we present some of the best online bank bonuses mostly at the national level. This list includes checking account bonuses as well as savings account ones.

There is a lot of free money available via these bank bonuses. However some sincere work is needed to earn a bank bonus. It pays to keep a log of the various conditions that need to be met for each bank bonus offer. Also,…

Read the rest of this entry »

[This post is written and copyrighted by FIRE Finance (http://firefinance.blogspot.com).]
Aug 25, 2010: If we own a business then we can pocket an easy $100 courtesy Chase. When we open a qualifying Chase Business Checking account with a minimum deposit of $1000 we’ll earn a bonus of $100! This offer expires on 30th September, 2010.

Sign Up Link: Deal & Details

Read the rest of this entry »

Buy bonds or stocks? A nice investment this year has been the bric versus BRIC trade. Since I disclosed it the long Colombia/short China position returned +50%, long Indonesia/short India +30%, Bangladesh bettered Brazil and Romania romped past Russia. Beta-neutral relative value strategies rarely make money on both sides. While economic expansion does not imply stock market growth, I’m more glad I didn’t tie up cash in “risk free” bonds.

Search for yield? Not long ago many experts said inflation was inevitable so short bonds but now deflation is the hot topic so buy them instead? There is a long list of gurus that lost big money short selling JGBs over the years but now treasuries are doing the same to them. If you need an explanation for the bond rally it is more a short squeeze than flight to “safety”. Trade bonds but don’t hold them. Just like stocks. Applied skillfully, long/short equity is safer than long only. And I’ll take fixed-income arbitrage and distressed debt strategies over “investment grade” bonds.

Read the rest of this entry »

Buy bonds or stocks? A nice alpha trade this year has been bric versus BRIC trade. Since I disclosed it the long Colombia/short China position returned +50%, long Indonesia/short India +30%, Bangladesh bettered Brazil and Romania romped past Russia. Beta-neutral relative value strategies rarely make money on both sides. While economic expansion does not imply stock market growth, I’m more glad I didn’t tie up cash in “risk free” bonds.

Seek alpha or bet on beta? Why does so much financial advice fixate on the irrelevant topic of how much to allocate to asset classes? The more “risk averse” the more in bonds? Is it sensible to recommend the same allocation if they yield 2% as when they paid 10%? Can opportunity cost and default risk be ignored with coupons so low and borrowing so high? There are no risk free bonds but at least higher yields delivered the fixed-income on which so many individuals and institutions depend. Absolute return is the alternative.

Read the rest of this entry »

[This post is written and copyrighted by FIRE Finance (http://firefinance.blogspot.com).]
Aug 19, 2010: Bank of America is offering a $75 sign-up bonus for opening a personal checking account with them. After a long time we found a BOA checking account bonus. So it’s a welcome :).

Sign Up Link: Deal & Application

Read the rest of this entry »

[This post is written and copyrighted by FIRE Finance (http://firefinance.blogspot.com).]
Aug 09, 2010: Every couple of months our wallets wear out due to the stress of bulging coins on the soft leather. Often the cost of replacing a wallet varies from $10 to $25. We’re wondering about ways to optimize this expense. One possible solution is to increase the life of the wallet. Another one is to do away with the use of a wallet! Since we need a wallet, we chose to go with the former one :).

On…

Read the rest of this entry »

Hedge Fund began five years ago today. It’s been great meeting and dialoging with many interesting people I might never have connected with. Initially I posted daily but outside the blogosphere I was helping investors make money and reduce risk. Developing portfolio rescue strategies and pension liability solutions also takes time. Despite vastly superior performance, hedge funds continue to be misunderstood. Some still blame them for downturns. Causality is cloudy: did EWP have a good month due to “stress tests” or soccer success? Stocks might eventually go up (or down) but why wait decades to find out?

Could individual and institutional investors afford ANOTHER severe bear market or credit cataclysm? There is no need for retirement savings and personal net worth to suffer the unreliability and volatility of long only stocks and bonds. Better alternatives and uses of capital are available. Some still bet on risky beta - the unskilled returns from asset classes. I prefer alpha - absolute returns from market skill. The only financial certainty in the future is a substantial increase in investment in skill. Major stock markets are lower than 5 and 10 years ago. Good for alpha but bad for beta. Don’t let beta behemoths crush your portfolio, again, prudent man. Fiduciary duty implies attempting to preserve client capital.

Read the rest of this entry »

Hedge Fund began five years ago today. It’s been great meeting and dialoging with many interesting people I might never have connected with. Initially I posted daily but outside the blogosphere I was helping investors make money and reduce risk. Developing pension liability solutions and portfolio rescue strategies also takes time. Despite vastly superior performance, hedge funds continue to be misunderstood. Equity benchmarks might eventually go up (or down) but why wait to find out? The five years were good for alpha but bad for beta.

Could individual and institutional investors afford ANOTHER severe bear market or credit cataclysm? Some bet on risky beta - the unskilled returns from asset classes. I prefer alpha - absolute returns from market skill. There is no need for retirement savings and personal net worth to suffer the unreliability and volatility of long only stocks and bonds. Better alternatives and uses of capital are available. The only financial certainty in the future is a substantial increase in investment in hedge funds. Don’t let the beta behemoths crush your portfolio, again.

Read the rest of this entry »