Monthly Archives: October 2012

Tips for Building a Solid Mutual Fund

If you’re thinking about building a mutual fund, it is well worth finding out as much as you can about it before you get started. One thing you should know is there are lots of options out there for building a mutual fund. You can choose different advisers or figure it all out on your own. You can use a systematic approach or simply ‘go with your gut’. Of course we wouldn’t recommend the second option, but one thing is for sure – you need a lot of knowledge to make an informed decision on what to buy and when.

Find a reputable fund manager with a good track record

Sure, you can figure it all out on your own. But there is a reason why some fund managers have had great success in this field – they know what they’re doing. Finding the best funds to get the best returns is a full time job, so instead of trying to figure it out in your spare time, rely on a full timer instead.

Look for an index fund

This is one of the most basic options available to you. However, don’t assume basic means uninteresting or unable to bring you rewards. The opposite is true. The index fund may not make as much for the adviser, but it stands to balance out the amount of risk for you. This means you’ll be able to stay safer and still stand a chance of getting a good return on your investment.

Watch out for the associated fees you’ll pay

Mutual funds mean fees – there are no two ways about it. But this doesn’t mean you have to settle for paying large fees on your funds. In fact if you do your research you can watch out for funds that have much lower fees overall than others. Crunch some numbers and compare funds and see which ones offer the best deal so you pay as little as possible.

Think about other investment types as well

Mutual funds are popular among Americans, and they’ve gotten more so over the years too. But while they are popular for good reason, they’re not the only type of investment out there. No matter how much or little risk you like to take with your investments, you should definitely consider balancing your mutual funds with one or two other types of investments as well. This will ensure any risk is balanced out – a good option since mutual funds don’t carry any kind of guarantee.

But perhaps the biggest and best tip is to know what you’re going into if you intend to build a mutual fund. Don’t just invest in one because you know a lot of other people who have done the same thing. Just because they’re good for others it doesn’t mean they’ll be good for you. They could be excellent, but only you can decide which ones to get and why – and how much you should invest in them as well.

Investments In Current Natural Companies

In Santa Cruz, Argentina, Argentex Mining Corporation has recently drilled 32 exploratory holes as part of its mining operations. All the land it’s drilling on is completely owned by them. The fact they chose to highlight, and with good reason, is that the Savary vein has an average of 192.5 g/t of silver and 3.65 g/t of gold over 30 meters. If you’re new to investing in natural resources, a lot of this was probably gibberish or at least far too filled with jargon. And yet ‘dry facts’ like these are exactly what you need to look into if you’re investing.

HEI President Charles Reed Cagle is perhaps one of the most prolific investors of natural resources out there. He did not get where he was simply by jumping onto trends, or information he didn’t look into. If you wish to invest in natural resources, which is certainly not a bad desire as it’s an extremely profitable industry, you need to know just what this means. In this case, a simplification would mean very good things for people already investing in the company, somewhat good things for those trying to get in right now, and bad things if you’re looking to get into it down the line.

At the end of the day Argentex Mining Corporation have literally struck gold, and enough of it to be able to get quite a profit either mining it or allowing other companies to do so. If you invested in Argentex when they were still doing the drilling, you will see their stocks soar and make a lot of money. But if they hadn’t found enough gold, you would be suffering. If you are trying to get into Argentex now that this news is public, you have an extremely brief window. Their shares will surge upwards, but if you can buy some now you can make a moderate profit. If you decide to wait until their operations begin, you will lose money. A boom always goes up then down, and if you try to invest when it’s up high you will make no profit as the shares stabilize and the stocks plummet.

In the end, Argentex’s drilling shows us the value of timing. You could either have taken a gamble in its preliminary state, or jump onto the bandwagon now, but wait too long in this industry and you’ll be left cold.

A Comparison Between Lending Club and Prosper: Peer to Peer Lending

If you’ve been reading our blog in recent weeks you’ll know we’ve covered peer to peer lending and two services in particular: Lending Club and Prosper. This week we’re going to focus in on comparing the two, to enable you to get a better understanding of how they fare against each other.

What amount of loans has been met so far?

At the time of writing, Lending Club had filled $960,287,975 in loans since it had first got underway. Prosper has managed under half of this at $411,000,000. Prosper opened its doors in 2006, while Lending Club began life a year later.

Are the loans rated to provide different rates of interest at each club?

Yes – you’ll notice different grades of returns at each service, going from A upwards. This enables you to gauge what degree of risk you are happy with and to balance your investments in each case too, so you can spread the risk.

What is the maximum amount you can borrow if you are looking for a loan?

Prosper will lend a maximum of $25,000, with a minimum of $2,000 in place. Lending Club will lend up to $35,000 and there is no obvious minimum given.

Are you guaranteed acceptance for your loan?

No – Prosper indicates it will accept creditworthy borrowers, whereas Lending Club specifies that it approves less than 10% of the people who make a loan application.

How do you invest? Is the process similar for each one?

Yes – you invest in notes. Each note with each company is represents a $25 investment. You can choose how many notes you want to invest, although a larger amount is more likely to give you a good rate of interest, because you can spread your risk across more than just a handful of investments.

Do you get a good degree of control over your investments?

Yes you do, because in each case you can decide whether you want safer A graded investments or riskier higher graded investments. Most people balance out the risk and thus improve their chances of getting better returns while spreading the risk.

How do you decide which peer to peer lending organization to go to?

There is no simple answer to this. One person might prefer Lending Club while another might be happy with Prosper. The best course of action is to go through all the options and to read the information on each website. Compare what each organization is giving you (either as a borrower or an investor) and see which one seems best for your needs.

One thing is clear though: both Prosper and Lending Club have established themselves as leading players in the peer to peer lending market. If you like the idea of this new model of investing and borrowing, it might prove worthwhile to look into it further. Plenty of people have already had experience of peer to peer lending from one side or another: you could be next.

Prosper: an American Peer to Peer Lending Club

Peer to peer lending is certainly becoming more popular, and Prosper is one of the leading clubs of its kind for investors and borrowers in the US to consider. It offers the potential of good returns for those who have money to invest, while people looking for loans can get reasonable rates on those too.

The website has a simple and straightforward home page that provides easy access to the different sections. This means you can find out very soon whether Prosper could be ideal for your needs.

Information for borrowers

The rates on loans vary depending on how good your credit record is. The fixed rates begin from around 6.59%, although this can vary. The rates can be higher than this however, as they are based on your own personal situation.

The application process is straightforward and relies on you supplying some basic details before you see your rates and loan opportunities. You then need to wait for investors to see your loan and invest in it before you can get the money you require.

Information for investors

For those who are looking for a good investment opportunity, Prosper could prove to be rather different from anything you have considered in the past. An investor puts their money into ‘notes’, and according to the information given on the website, everyone with at least one hundred notes has had a positive return on their money since the website first opened.

The good part about Prosper is it provides the opportunity to decide whether you want to take on a small amount of risk or a much larger amount. The safest investments will return a generous amount (currently around 5.49%) while the highest risk investments can return approximately 12.46%. This gives you more freedom to choose the most appropriate investments for your needs. Indeed you can spread your risk ratio in a way you couldn’t do with a standard investment of any kind. Thus it can suit a wide range of people.

Furthermore there is the potential to get monthly payments into your account once the people with the loans make their monthly payments. So it all works in a very logical manner.

Is Prosper for you?

Prosper certainly presents a good option to consider if you are looking for a different investment or another potential source for a loan if you have been turned down by the familiar sources. Of course since this is rather different from anything you may have come across in the past, it is worth reading through all the information on their website – in particular the ‘how it works’ section. This will provide all the information you need on how Prosper works and how it is different from other investment and loan providers.

Prosper and peer to peer lending may not be for everyone. But for those that it appeals to, it could be a refreshing and worthwhile source of loans and investments, regardless of your financial position at the moment.

Lending Club: Peer to Peer Lending in the US


A form of lending that has become more prevalent in recent times is peer to peer lending. As the name suggests, it focuses on the idea of people lending to each other and to businesses, rather than using the banking system to facilitate such loans.

One leading company providing such a service is Lending Club. The club opened its doors in 2007 and has been going strong ever since. The whole process works over the internet, so providing you have access to their website you can find out more about them and open an account or apply for the loan you need.

Information for those who want to borrow

If you cannot get a loan via your bank it may be worth considering Lending Club. According to their website you can borrow as much as $35,000 from them. The application process is handled online and you pay the money back in monthly payments in much the same way as you would with other loans.

One of the advantages of looking to Lending Club for your loan requirements is the ease and simplicity of getting the quotation you need. They provide rate comparisons with other services as well, so while you should compare rates independently they do seem to offer a competitive service.

Information for those who want to invest

This is perhaps the most interesting part of Lending Club. The principle works according to Prime Consumer Notes. Each ‘note’ is an investment and while you can choose how many you want to hold, many people opt for hundreds at a minimum. Some elect to invest in thousands.

Lending Club grades the notes according to the risk that fits with them. Grade A notes are the safest and provide a lower rate of interest. Grade G is the riskiest note and therefore provides a much higher rate of interest, around three times as much as the safest note.

It is up to you how much risk you wish to take, although they suggest you opt for a mixed selection to spread the degree of risk you are taking.

Is Lending Club for you?

Clearly it is worth taking a closer look at Lending Club if you are considering either an investment or a loan of some kind. The opportunity to balance the amount of risk you are taking will appeal to those who want to exert more control over their investments. Furthermore those who wish to apply for a loan without having to jump through the hoops provided by the normal banking system may find what they need here.

Of course Lending Club won’t suit everyone, whatever side of the fence you happen to be on. However it may well prove to be a viable alternative for many people, and one that fits with personal goals and desires. With more than $900 million worth of loans funded so far, Lending Club has established itself as a key player in the industry.

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