Pros and cons of indirect investing

Investing indirectly means purchasing shares of companies that hold large portfolios of securities on behalf of their share holders. Indirect investing is a great opportunity for those who are willing to start investing with a small amount, having no previous knowledge or experience of stock market’s ups and downs. You can decide if indirect investing is the right choice for you after examining the following features.

Level of Risk:
Although mutual funds are managed by qualified professionals and experts, no expert can guarantee a profit on every investment made. There are many uncontrollable variables involved and then there is always a chance of “something” unpredictable happening, normally referred to as “the great unknown”. Mutual funds can be divided into different categories on basis of risk, for example “hybrid fund” being less risky while “specialized stock funds” falling in the high risk – high return category.

Professional Management:
Probably the biggest advantage of indirect investment is the fact that these investment companies have experts specializing in investment analysis and portfolio management. These companies always stand a better chance for positive yields as compared to a common man who barely knows about financial markets. If you are just starting, you should go for these companies. You can always move your funds elsewhere later on.

Extra Charges:
Investment companies do not provide this high quality portfolio management services for free. Of course they charge for these services. Also, most of these companies run excessive marketing and sales campaign because of competition. Some part of this expense is also charged from investors, known as sales load.

Discount & Premiums:
Net asset value of Investment Company’s share keep going up and down based on company’s performance. In case of close-end funds, these shares are not always traded on Net Asset Value. If sold at a price lower then Net Asset Value, these are said to be sold at discount and if the price is higher then Net Asset Value, they are selling at premium. This provides an opportunity to earn, even when the Net Asset Value has not changed.

No Security - No Control:
These mutual funds are not guaranteed by any government body or authorities, nor do they provide any specific protection. Another short coming is that you cannot control the proceedings; you have to rely fully on the company’s management decisions regarding investment. If you can’t bear the fact that someone else is deciding on your investment fate, you should go for direct investment.

Plan your business projects for success

Businesses often fail to see the importance of project planning. Especially new businesses, charged by their enthusiasm and excitement, consider it a waste of time. In reality project planning saves more time than it consumes, it serves as a road map for the project, helping it in getting complete in a smooth and timely manner. Misuse of company’s resources and lots of disputes can be avoided by laying down a plan in advance. Main components of a project plan are discussed below.

Goals & Objectives:
First thing to decide and clearly state in a project plan is the goals and objectives of the project, both from company’s and client’s perspective, like what needs to be done and in how much time? Not only it provides the people working on project with unmistakable targets but it also allows the management to evaluate the work in later stages. Ultimate goal can be divided into small milestones to keep a check on the performance.

Authority & Accountability:
People directly or indirectly responsible for project completion, their coordinates and subordinates, persons to whom they should report, everything should be mentioned in a plan. This will help workers to better understand their responsibilities and deciding who is accountable for what? By assigning tasks, it becomes easier for the person in charge to figure out who’s the weak link in the chain.

Resources & Alternatives:
Other important areas of project planning are resource allocation and budgeting. Budgeting should be done with the help of accounts department. Although project planners would like to see their plan working smoothly till the end but it seldom happens. Every project has several risks involved and some alternate actions should be suggested to counter them. It’s good to point out alternate approaches like A, B and C to tackle the problems which are most likely to happen. That doesn’t mean you need to make three or four separate plans.

Implementation & Evaluation:
Plan should be practical enough to facilitate the process of implementation. Primary purpose of project planning is to eliminate complications, not to create them. Once a plan is completed and approved, it should be put into action immediately without wasting time in over- analysis. After the project is on its way, management should keep an eye on its progress and if the things are working according to plan. Plan should be flexible enough to let small changes happen later on in case of some unexpected circumstances.

Personal time management for small business owners

"The bad news is time flies; the good news is you are the pilot."
Michael Altshuler

Personal time management becomes all so important when you are starting or running your own business. As a home based business owner, you need to improvise your time much more wisely. You need to get rid of your time wasting habits quickly before they drag you away from your goals and objectives. Let’s have a look on some key factors to start managing your time more efficiently.

Take Charge of Yourself:
Fist step is to get a little organize. Start from taking your goals and ambitions seriously. You are not going to get another lifetime, so the time you waste means a little less achievement than what you were capable of. Write down your goals and what do you need to do in order to get there. Set priorities; decide what’s important and what’s not. Divide your working hours in small sections and assign tasks for these sections. Once you are done with the planning work, stick to your schedule or time table.

Look for Time-Dumping Activities:
Figure out the activities which are nothing but time killers. It could be anything depending on different persons, watching television, surfing web (apart from the work related to your business), pondering over your life during working hours, etc. All of these activities allow your mind to loose focus from your targets; they eat out your precious time before you even notice. Try to kill these habits before they deprive you of your goals. If you are working on something and some idea sparks into your mind, just write it down and carry on with your work. Thinking is good only if it’s converted into action right away.

Avoid Laziness:
Laziness, half-hearted attempts, being afraid (or even sure) of your failure before you get started, waiting for some perfect circumstances (which never comes anyway), all of these mind frames make you lethargic or exhausted even before doing anything. Don’t let your mind wander on negative routes, fear of failure should never be allowed to stop you from trying, because once you start, at least you have get a chance to succeed, never starting means a 0% chance of success and a 100% chance for the failure.

People who are successful had no more than 24 hours in a day; they just utilize them more intelligently. Their success is the reward they get for doing the right things at the right time.