Should You Consider An Investment Holding Company?

Carefully managing your investments has always been of the upmost importance to those who want to enjoy financial stability for the remainder of their lives, but old methods which were previously reliable are now increasingly being called into question. While investment holding companies were incredibly popular some time ago, for instance, they’re now facing more and more criticism centered around their ineffectiveness in the modern world. Nevertheless, many investors want to know if considering an investment holding company is still worthwhile.

What are the pros and cons of investment holding companies, and how might they be leveraged in this day and age? Here’s what you should know if you’re considering an investment holding company.

What is an investment holding company?

To put it simply, an investment holding company is one that earns its payment through dividends or interest rather than offering a traditional product or service to the public. By stowing your investments into an investment holding company, you could theoretically ensure that your capital gains income and interest rates paid to you were managed similarly to corporate taxes. Thus, investment holding companies proved to be incredibly important over the years when it came to reducing one’s overall tax burden. These days, however, they’re not quite as potent as they once were.

In the modern world, taxpayers often face very similar tax rates on their investment income regardless of whether they generated that income personally or through a corporation. While the passage of the Republican Party’s Tax Cut and Jobs Act in the United States lessened the overall corporate tax burden significantly, it’s still largely true that many individuals wouldn’t necessarily see huge gains from pivoting to an investment holding company. In certain scenarios, however, they remain attractive investment vehicles, especially for those wide-ranging investors who want to ensure their diverse income stream is taxed in a coherent and manageable fashion.

It can thus be lucrative to consider investment holding company options, though you should always do your homework before investing your money. Individuals with particularly high net-worths may find that holding companies help shield them from stringent tax burdens that could prove to be too burdensome to bear. Investment holding companies aren’t exclusively useful for the wealthy, but those with a lower net-worth may find that the tax savings derived from them aren’t so high as to be worth pursuing in some cases.

Keep an eye on your dividends

If you do end up investing in an investment holding company, understand that it doesn’t operate lke a traditional business. Investment holding companies don’t sell products or services like traditional businesses, but rather serve as investment vehicles that help corporations mitigate risks while making it easier for investors to manage their diversified assets. The health of an investment holding company is usually determined more by the dividends it gets from investee companies than anything else, so don’t ever forget about dividends if you go down this path.

Anybody seriously committed to the idea of an investment holding company should do plenty of reading before throwing their money into the marketplace. Reviewing some helpful tips could help you avoid losing a huge sum of your money. It’s also worthwhile to review a list of both pros and cons, as you’ll want to have an even understanding of investment holding companies before you either dismiss them entirely or opt to invest in one. They’re certainly not quite as common as they used to be, especially when it comes to mitigating the overall tax burden wealthier individuals face, but investment holding companies remain an important investment vehicle for many across the marketplace today.

Trading vs Investing, Is there a Difference?

If you are looking for ways to generate income, you might be thinking about stock trading or investing. To know which one is best for you, you might want to look at the difference between the two. 

The focus and timing are the main differences

Stock traders aim for short-term gain. They buy and sell stocks within days or even minutes, with a focus on the share price. They are interested in the evolution of the stock and how they can profit from it.
Investors, on the other hand, have a long-term gain objective. They buy stocks and often keep them through the market’s ups and downs. They also reinvest dividends and profits into additional shares. Their focus is on a company’s potential for long-term growth.

Trading and investing have different approaches to protection

Financial Market Environment & Investment Strategies

Image via Flickr by BuzzUdemy

Trading uses stop-loss orders. The idea is to close out at a pre-determined price before it goes down. Investing keeps positions during downtrends with the expectation of recovering the losses when prices go back up.

Different categories of traders

You can categorize traders by the length of time they hold onto their positions before selling them off. Scalp traders, for example, hold on to securities for only a few seconds. Day traders don’t keep positions overnight.
Swing traders can usually hold positions two to six days before selling. They use a more long-form approach to trading. Swing trading aims to identify a trend and find gains within it and can lead to substantial annual profits.

Trading or investing?

There are different things you can consider to decide which one is best for you.

  • Profit goal. For a short-term return, trading is the way to go. If you have a long-term vision, investing is.
  • Time. Investing requires a lot of patience and some research. But if you chose the right investments, you might get the chance to let the investment work for you. Trading is more time demanding. It requires hours to study charts and graphs, continually monitoring your returns.
  • Taxes and fees. The capital gains tax is applied to any capital gain, and there are fees applicable for each trade. Trading involves much buying and selling, so more costs too. Long-term capital gains are taxed at a lower rate than short terms gains.
  • Risk. In trading, the risk involved is higher than in investing. If the market drops in minutes before the trader had a chance to sell, he can find himself at loss. Long term investments, on the contrary, allow the investor to hold on to his positions until the market rebounds before selling.
     

Trading and investing can both bring returns or losses. Traders take advantage of the market conditions to buy or sell their positions on stocks over a short period and earn many but smaller profits. Investors buy and hold stocks with the objective of more significant returns over a more extended period. To decide which one is best for you, you should consider the one you are more comfortable doing. 

How Early-Stage Startups Make Money

The startup industry is a lucrative one. That said, for a startup to obtain the money it needs to grow, there are players that need to be involved and processes that need to be in place

 

Between forming key relationships and crafting the perfect pitch deck for investors, there are a lot of elements involved in getting a startup off of its feet financially.

 

Especially in the early stages, startups make money by making smart choices — investing the right way, reaching out to the right people, building a unique presence and more.

 

Consider the strategies new companies use to attain working capital and sustain a growing business:

 

Investors

 

Investors are one of the most popular means of funding for startups. When a business shows growth potential, Investors put money into the company with the incentive of getting a portion of future profits or even stock.

 

These investors — angel investors and venture fund capitalists alike — aid businesses financially not only to get them off their feet but to earn a stake in the companies.

 

You typically attract these investors by delivering an engaging and informative pitch presentation. These presentations require a creative and clear pitch deck that will sell investors on the value of your business.

 

Fortunately, you can work with a professional PowerPoint design agency that will help you ensure your deck is unique, informative and persuasive. To learn the importance of a pitch deck and where to start, check out this guide to slide design for PowerPoint to give you some inspiration.

Crowdfunding Platforms

Business News Daily defines crowdfunding as “when businesses, organizations or individuals fund a project or venture with small donations from many people.” Typically, these funds are attained by using a crowdfunding platform to showcase the project, provide a means for donation and share incentives like exclusive rewards for those who donate certain amounts.

Kickstarter was a leading crowdfunding platform in the past, but nowadays, there is a wide range of platforms being used for collecting these funds.

Collaborations

Startups make money by spending less — and a great way to keep costs low is by collaborating with other startup companies with common goals in mind.

Especially when working in close quarters like co-working spaces and other spaces dedicated to startups, new businesses can utilize each other’s services and trade labour and work instead of money. By doing this, they can save on costs and form relationships that can be potentially profitable in the long term.

Say, for example, your PR startup provides social media support for a neighbouring web development startup. If you secure a client that also wants a website, that’s the company you will likely refer your client to. It’s a give and take.

Loans

All that said, one way many startups make money is by taking out a business loan. A business loan can provide the funds you need to kick start your business — invest in product, staff and office space.

This way, once you start selling product and generating revenue, a portion of the profits can be utilized to pay off the loan. Loans are often taken out for specific areas of growth like equipment, production, staffing, marketing and commercial space.

At the end of the day, there are a wide variety of channels a new startup can take to earn funds. The best route is often a good balance of the strategies suggested.

Gold or Bitcoin: Which is the Better Investment?

The cryptocurrency rose to popularity as a peer-to-peer decentralized currency sometime in late 2010. The concept was introduced in a white paper in 2009 where the author highlighted the advantages of currency exchange in a secure manner, without any involvement of banks whatsoever. There were no third-party merchants in the transactions. If you had computing power, then you could mine your own bitcoins using decryption methods, and trade them with one another, in a secure channel.

Why Cryptocurrency?

In the past decade, Cryptocurrency has seen the rise and fall in terms of transactional value. Bitcoin trading is unlike normal trading. There is no fixed trading value for bitcoin. It just uses the last transaction exchange rate for future transactions. This is a two-sided sword for investors. On one hand, you could benefit from a previously executed higher than the normal transaction, but on the other, a downward spiral of prevailing transaction rate may incur uncontrollable losses. This volatility makes it unpredictable as an investment. But, on the upside, the security aspect of transacting only with the one that you intend to, using the unique QR code, brings about a sense of reliability in the cryptocurrency transaction. Peer-to-peer decentralized transaction means that there are no losses involved in value exchange. This brings about a fairground for both buyer and seller alike.

Is It Safer than Gold?

Gold has always been a standard of investments. It has appreciated in a steady fashion. Ever since the beginning of forms of currency, elemental currencies like gold, and copper have been widely accepted forms of exchanges. Time has played an important role in increasing the dependability and acceptability of Gold among civilizations. Moreover, Gold investments have been traditionally dominated among families and are passed on as generation-to-generation safe investment advice. Often if you ask an individual investing in gold, the most obvious reply would be of influence from family members. Hence, individuals have traditionally preferred to invest their hard-earned money in well-known investment modules like gold.

Things are, however, now changing. An average investor with little knowledge of investments is aided by a variety of data-crunching automated investments applications like Crypto-trading software, all they have to do is lock in their money, and the AI trading software from https://de.crypto-vipclub.com does the rest. This has given to the rise of cryptocurrency trading and is being portrayed as the next big investment to gold. The absence of intermediaries and zero-loss transaction security, along with distributed ledger technology has further boosted the confidence of neo-investors to invest in Bitcoin.

 

Conclusion: A Road with an Unpredictable Dead End?

The crypto-trading field is an upcoming field that promises higher returns on a short term basis. However, it is not without cyber-security threats, and the fact that it is a virtual-money puts an inherent sense of unpredictability in the minds of investors, who wish to grow their financial investments in the long run through cryptocurrency trading. Gold, on the other hand, shall continue to be a safe investment, as it is the most widely accepted form of investment in the whole world. This acceptance increases the reliability and dependability for investors, as against a virtual-money with no guarantor for any cyber-crime that may wipe out cryptocurrency investments.

Still, we cannot deny the fact that many of the big financial investors and reputed industries are investing in cryptocurrency which is slowly increasing the trust amongst the general public. And the increase in the bitcoin investments is taking it towards a scarcity as we are aware that the quantity is limited, which means this is the best time to invest in cryptocurrency if you are looking to gain huge profits in the near future.

 

 

Ava Trade Collaboration with Friedberg in Canada

Ava trades now have much new collaboration, but one of the most important is with Friedberg in Canada, Collaboration with the oldest and well-known dealers of Canada.

Friedberg directly gets the licensed from the Ava trade technology to offer the Ava trades platforms to the participants of Canada.

This collaboration allows all the candidates to trade online on Friedberg platform by one of the most CFD and FX provider.

Friedberg directly attached with the Ava trade technology and provided all the multiple trading platforms. It offers 24/5 hours service and live support staff in 15 languages.

Friedberg and Ava’s trade provides all the essential aims of your candidates with easy access to financial markets and very further trading in other technology.

If you want to start trading with Friedberg, you have to visit the Friedberg Direct by Ava trade Canada

Open Account with Friedberg Direct

Friedberg is a client-friendly platform, and client start trading immediately. Canadian investor’s funds guard this platform within limits.

This collaboration spread the Ava trade technology all over the United States and increases its more customers.

This technology has broad array of CFDs including metals, and other things like stock, currency, pairs, single and large-cap stocks, as well as US, Japanese, Europeans large bonds.

Customers have the opportunity to trade with a fixed or floating extent.

If you want to start Trade business, you have to follow the following steps

  • You have to plan your business and choose the business structure, visit the market and write about your business.
  • Select the best name for your business because it is essential to select the name that registers and protecting your business.
  • The main point of your business is to express your business with the government and get the license.
  • Three levels of permit you need for your business, and you must get the license that helps you in future problems.
  • Get business sport and finance. It enhances your business in the market and helps you to promote your business widely.

How to Trade Stock Online

Everything is possible in these days, and you can start trade stock online as a business. There are some steps are mention that helps to start an online business like online Trade Stock.

  1. Open an Account
  2. Practice you trading
  3. Time to buy
  4. Understand the price
  5. Advanced orders

Open an Account

First, you have to set up an account and select the services that help you to trade online.

Many of the other sites required commissions, but Ava Trade is one of the best that is commission-free.

When you set up an account, you need to fill many forms and provide all the bank information but make sure that all the process is secure.

Practice your Trading

Many of the Ava trades sites provide many articles and videos to learn about the advantages of trading.

You need to practice your trading and learn about its advantages and disadvantages because this can guide you better.

In Ava trades, for bingers’ demo account are appear so firstly you have to create a demo account and learn about the basics of trading.

Time to Buy

When you are ready to buy, you select the symbol of a company and exchange the trades.

Select buy and buy the things at its original price and also you have to enter the number of sharing.

Order will show the total price without any commission. You’d get the confirmation status with your order and tell about the law if it filled.

Understand the Price

Stock divided into two prices the one price is bid price, and the other one ask price.

The bid price is the highest amount that can pay a buyer for a stock. But the asking price is the low price that the seller gets.

There is some difference between these prices like some cents. One thing keeps in mind that the market order will be filled at the current rate.

If the price of the market changes the cost of the order will also be changed according to real estimate.

Advanced Orders

Once you were starting comfortable trading, you will get more advanced options.

A limit order allows specifying the price of the order, and you are willing to pay. For example, if you want to buy 100 shares of some company but you don’t want to pay more than 20$, if you place the order in 20$, you don’t change the amount less than 20$.

You have to use the “stop-loss order” on each time that will automatically sell your stock and allow you to lock the orders that you gain.

If you received the benefit, you must stop the process of trading and understands your interest.

3 Top Tips to Trading the Forex Markets

If you are one of those people who watched the film Wall Street and/or the Wolf of Wall Street and fancied some of that action, but have little or no experience of trading, then this article is for you.

 

Put in the Effort

The first and most important piece of advice that can be imparted upon a newbie trader is to make the effort. And, when what is meant by make the effort is to be honest with yourself, your limitations and the resources available to you, if you want to succeed in forex trading you need to put in the grunt work. Successful trades do not fall onto your lap, you will need to study the assets, study the markets and master the technical analysis charts. If you cannot commit the necessary time, resources and energy to these studies, then forex trading is not for you. Forex is like life, generally speaking, the more you put into trading, the more you get back. Doing the hard work in your studies, staying on top of the daily investing news will see you reap the rewards in your trading for a long time. If you go into forex trading half-heartedly or without doing the required studies, you will fail and lose money. Make sure to put in the effort into everything you do and you benefit from the hard work for a long time to come.

 

Keep Your Emotions in Check

Keeping your emotions in check is winning half the battle in forex trading. Whenever there is money involved, we get emotional which is dangerous. Letting our emotions get the better of us will result in decisions being made that do not have clarity of thought. Emotional decisions equal risky decisions, especially if we are chasing losing trades. Being able to detach yourself emotionally from trades will help you keep clear of thought and stay true to a strategy. Once you find yourself chasing losing trades or getting carried away on winning trades, you have lost the battle with yourself. Stay disciplined and always keep your emotions away from the trading station.

 

Use Help Whenever Possible    

Just to be clear, getting help is not an alternative to putting the hard work yourself. However, help is out there that can be essential to trading the forex markets successfully. There are social media groups in Facebook, Telegram, LinkedIn and WhatsApp that are filled with likeminded traders only too happy to share information, swap tips and generally encourage other to become better traders.  Another option for getting help is employing the services of a professional forex mentor. Someone there to hold your hand through the learning process, tell you where you are going wrong and what you are doing right can be invaluable to any new trader and worth their weight in gold if you want to take trading seriously. Shop around, trying some free trials and find a forex mentor that you feel comfortable will take you to the next level of trading.

 

 

 

How Does GIC Laddering Work?

A GIC, or guaranteed investment certificate, is one of the safest investments you can make. When you buy a GIC, you’re essentially agreeing to lend a bank or financial institution your money for a certain number of months or years. In exchange, you’re guaranteed to receive the amount of money you deposited plus a little bit of interest.

 

Naturally, GICs are part of many investors’ fixed income portfolios.

 

The longer you lock your money into a GIC, the greater the return. One-year GIC Rates in Canada, for example, may offer a 1.5% yield, whereas a five-year GIC might offer 2.5%. The five-year option is obviously more appealing, but you may not want to lock in your money for that length of time.

 

If you want to invest in GICs but don’t want to place your entire investment for five years, there is another option: GIC laddering.

 

How Does GIC Laddering Work?

GIC laddering is a simple way to maximize the returns from this type of investment without having to lock your money into a long-term investment.

 

Laddering is a lot simpler than it sounds:

  • Divide your total investment amount by five
  • Invest those five smaller amounts into five individual GIC terms:
    • 1-year
    • 2-year
    • 3-year
    • 4-year
    • 5-year
  • Once each term matures, reinvest the new amount into a five-year GIC.
  • Rinse and repeat.

With the laddering method, you have a term that matures every year. Each year, you can decide whether you want to reinvest that money, or access it for your own use.

 

If you continue with the laddering method, your return rate will be much higher compared to investing in consecutive short-term GICs.

 

Keep in mind that in most cases, you’ll need to invest at least $500 with a GIC.

 

What are the Benefits of GIC Laddering?

There are many reasons to consider adding GIC laddering to your portfolio.

 

 

 

Low Risk

GICs are a very low risk investment. It’s a guaranteed, as long as you purchased a GIC with a fixed interest rate. The return rate may be low, but you’re guaranteed to walk away with your initial investment and interest accrued.

 

Maximize Your Returns

The laddering strategy allows you to maximize your returns because you’re spreading your money across different GIC terms. Also, you don’t pay any fees with a GIC.

 

Access to Your Investment Every Year

With the laddering strategy, you have access to 20% of your investment every year. It’s a somewhat liquid investment strategy, so if you need money to pay for an unplanned expense, you’ll have the option of keeping the money from a matured GIC.

 

Take Advantage of Rising Interest Rates

Each year, one of your investments will mature. This means that you’ll be able to take advantage of rising interest rates when you re-invest in a new 5-year GIC.

 

Potential Risks

Just like with any other investment, there are some potential risks – even with a GIC.

 

The primary risk is that your returns will not keep pace with inflation. If the interest rate on your GIC is lower than the rate of inflation, your purchasing power will actually decrease when it matures.

Improving Financial Skills Through Literacy

Financial management has been defined as understanding the financial consequences of your actions and ensuring you only do those things that enhance profitability. However, I would add financial failure to that definition, as it’s an important part of the industry and my work as a merchant banker.

In short, you can’t expect all of your investment to result in significant returns. So you need to condition yourself to deal with the failures and continue your work with the same passion you had prior to the disappointing outcome. That’s what makes a successful merchant banker.

But let’s take a step back. It’s been said that 90% of business failures around the world are due to financial mismanagement. Not poor marketing, not labour problems but plain old bad management. So how do we resolve this problem? We need to focus on financial literacy, one of the world’s biggest challenges.

Although there are many worthwhile financial literacy initiatives happening today all over the world, too many of us don’t have a basic understanding of things like budgets, inflation and rates of return. Although it’s unrealistic to expect everyone to possess sophisticated financial knowledge, it is broadly agreed that some financial knowledge is necessary to make important life decisions related to money.

Building personal financial capabilities early in life can give people the foundation for financial well-being in the future. Schools are an important channel to provide the education that can improve financial literacy. Studies in the U.S. have shown that financial education, when done properly, leads to an improvement in financial behaviour.

But there’s a long way to go. According to a survey of 13 million U.S. high school students, only one in six received mandatory financial education. And only 17 states require personal financial content to be included in educational standards.

Of course, people want to make good financial decisions that set them up for success but most haven’t had the opportunity to learn. For instance, a significant number of American adults can’t pass a basic financial literacy test with three questions on stocks, interest rates and inflation. Here’s an example:

Suppose you had $100 in a savings account and the interest rate was 2% per year. After five years, how much do you think you would have in the account if you left the money to grow?

  • More than $102
  • Exactly $102
  • Less than $102

Although 43% earned scores of three, meaning they correctly answered all the questions and another 36% received scores of two, 21% got only one or zero questions right. Across all households, the average score was 2.2. Considering that the questions are relatively simple, those scores aren’t good enough and show why financial literacy needs to improve, and not only in the United States. The correct answer in the sample question, by the way, is more than $102.

Financial literacy can be a hard sell for educators, many of whom don’t see the importance of adding it to the curriculum. But it’s a skill all of us need to succeed in life. If you teach a child about financial literacy, odds are he won’t come back to live in your basement after college.

Cannabis Retail Offers Potential Investment Prospects

The role of a merchant banker is in part to provide capital to entrepreneurs and startup businesses that exhibit high growth potential. If you dig deeper, though, what investors are really funding are good ideas that show potential and, moreover, have the potential to disrupt industries.

Possibly the biggest disruption right now in Canada’s consumer market is cannabis. The opportunities that cannabis present are becoming more and more evident to companies around the country, and that means entrepreneurs want to be invested before everyone else gets into the act. In particular, cannabis retail is a promising sector of the industry that is presenting rapid growth potential.

Until April 1st, legal cannabis sales in Ontario were only available through an online government e-commerce store. Today, according to the provincial Alcohol and Gaming Commission, cannabis retail shops and outlets are appearing across the country in Ottawa, Kingston, Toronto, Brampton, Burlington, London, and St. Catharines.

This means millions of dollars of potential investment opportunity for companies that focus on running recreational cannabis stores. To date, large operators have attracted the lion’s share of investment dollars – but there are opportunities for smaller players too.

If you really think about it, smaller players who are looking to expand in high-value markets need capital. They could see outsized returns without requiring the significant capital investments needed by larger players. To boot, entrepreneurs are continuing to find a number of new opportunities in the evolving cannabis industry and one of those opportunities is marijuana-infused edibles. What was once known as the stereotypical “pot brownie” has moved far beyond to products that include infused beverages, candies, tinctures, and cooking ingredients.

For those who prefer a cannabis-adjacent business, information to accompany new products and uses is another important area that offers business opportunities. Putting the right data in front of consumers, and providing them with knowledge, is a need that entrepreneurs can fill.

As the number of legal cannabis consumers increases, so will the business opportunities.

It’s a great time to be a cannabis entrepreneur, but it’s still crucial to be knowledgeable about your product and your business, and more importantly, you still have to be passionate.

The Best Way to Invest Money For Passive Income

The term “passive income” sounds great, doesn’t it? Earning money for little to no physical time or labor. Passive income in reality is an income stream that flows in regularly without too much time or labor, it doesn’t necessarily mean you put forth no effort at all. With passive income the idea is to make an upfront, or front loaded investment of time or money with the hopes of it snowballing later on into a steady income stream requiring little to no time.

There are tons of great ways to invest online and create a passive income streams for yourself and your family. You do need to understand, however, that not all passive income strategies are the same. Some require a lot more time and money than others. That being said, let’s look at the most popular passive income opportunity that everyone is talking about right now.

Peer to Peer Lending or P2P

This is a modern twist on the old school, small town loan office. The idea is basically the same. Individuals loan money to other individuals and then make money on the interest. Usually these types of loans are for people who cannot get traditional financing. Modern technology, however, has taken this idea to a whole new level. Today P2P platforms can make it possible for individuals all over the world to loan money, even in micro amounts, to other individuals all over the world.

Feel Good About Your Investments

Beyond simply being a great way to establish passive income, this can in many cases also be a great way to invest in humanitarian efforts as well. In many instances the loans are being processed for individuals in situations in which they are trying to better themselves. Loans can be used to buy a vehicle, start a business, pay for college or many other noble reasons. Some platforms even allow you to pick and choose the recipients of the loan so that you can feel great about where your money is being used.

Get Started Quickly

This is a great way to get your investment journey up and running because some platforms allow you to begin investing with as little as $25. There are almost no barriers in place to get started which is far different than traditional lending.

P2P lending is one of the most passive of passive incomes because you literally fund the account and then make money. Easy as that. If you would like to learn more about this super easy way to start earning passive income, you can start by reading reviews of individuals who are already making money through platforms like Mintos. Check out this Mintos review to learn more.