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Class rank and GPA’s were once the ticket to graduation and a successful career. But times have changed! Your credit image is now an important key to your future. You may be a student in your 20′s or someone with significant life experience who has returned to school. Either way, you are never too young or too old to establish a strong credit image. In the past, credit was extended based on personal knowledge of you and your reputation. Not anymore! Today, your personal reputation has been replaced by a credit report/score.Your credit image is a snapshot (like a photograph) of your credit worthiness at a fixed moment in time. This credit image is how you look to others who are making decisions about you. It determines what interest rates you are offered, and affects many other decisions made by credit card companies, lenders, landlords, employers, insurance brokers, utility and cell phone companies. Your credit image can also impact private student loans. Establishing and building credit in today’s current economy isn’t easy and can be very confusing without understanding where to begin.How Credit Scores WorkThe most important contribution to your credit image is your credit score. Understanding what makes up the score will give you an edge on how to manage your credit image and make good credit decisions along the way.To date, the most widely used credit score is a FICO score (designed by Fair Isaac Corporation). This score ranges from 300-850, broken down as follows:35% – Payment History: Making payments on time is the most critical part of building a credit score. Delinquent payments can stay on your credit report up to seven years. They can cost you higher interest rates, over-the-limit charges and late payment penalties – not a good use of your money.30% – Amounts Owed: When possible, keep balances to 30% or less of available credit. This is called your balance to limit ratio. You may spend more, but always keep your balance carried each month under 30% of your credit limit. Make more than the minimum payment to help build a strong score and credit image.
15% – Length of Credit History: Considers how long you have had loans or credit cards. This may be one of your weakest areas if you have just started establishing or re-establishing your credit.10% – New Credit: A reasonable amount of new accounts established over time will help increase your score. However, too many new accounts in a short season of time can raise concern. For example, you’ll want to seriously consider whether applying for three new department store cards will serve your longer term goals. Too many “hard inquiries” required to grant credit can lower your score for up to two years.10% – Types of Credit Used: Diversity of account types shows lenders and others viewing your credit image that you can manage different types of credit. The scoring model looks for credit cards, revolving credit such as department store cards, installment credit such as auto loans, and mortgages.Where to BeginFirst, pull your free credit reports. When you see “free” credit scores, beware there is a catch. Many times they request your credit card or banking information for the “free” trial or to take their surveys which could be profiling you for other services. You normally pay a fee to retrieve a credit score, although individual credit reports are free. Go to annualcreditreport.com and request all three credit reports – one from each of the major credit reporting agencies: Experian, Equifax and TransUnion. In California, credit reports are offered free of charge once annually. (Some states offer free credit reports more often than once a year).You may have never applied for credit before; yet, if you have held a job you will have a credit report even if it only shows your personal information (name, birth date, social security number, current address and employer). It’s possible there are reported inaccuracies. Scarier yet, someone may have used (or attempt to use) your personal information and identity for their personal credit use. Review all three reports very carefully. Immediately address all inconsistencies or inaccuracies with the credit reporting agency, disputing all incorrect information.What NextGoals and Objectives: Determine your goals and objectives. Do you need to establish credit or possibly re-establish it (short-term goal)? Are you considering a major financial purchase like a house or car, or landing your dream job after graduation (long-term goal)?Banking: Open a checking and savings account with a banking institution. When deciding on a bank you may want to seriously consider a credit union. They typically offer lower interest rates on credit cards, car loans and mortgage loans when you are ready to establish credit lines.Installment Payments: A good way to help you build credit payment history is making timely installment payments like a car loan. At first you may not qualify on your own to finance a car; yet, if a parent is purchasing a new or used car for you, discuss the possibility of placing your name on the auto loan as a co-signer. That way you will both get credit for making payments on the loan.Credit Cards: After establishing a banking relationship for six months or more, consider applying for a bank credit card. If you don’t qualify for your own credit card, a parent or someone who has good credit might consider adding you as an authorized or joint user to their existing credit card. An authorized user doesn’t always have the history from a credit line reported to their credit reports but a joint user (who assumes joint liability for the debt) does. A secured credit card is another alternative. Normally these types of cards have different requirements such as a deposit of $300 to $500. Before applying for a secured card, check the fees to see if they are fair and reasonable. Do they report your credit card activity to the credit reporting agencies? After a year or two will they allow you to convert to a regular credit card? Will you receive your deposit back?Beware of the credit card companies that target students at universities. Be wise – read the fine print and ask yourself first, why you are applying or accepting the credit card being solicited. Do not be swayed by the free item they are giving away if the terms and conditions are not reasonable. Once you have been accepted, be mindful to live within your means. It can be very tempting to spend now and pay later but “later” can be a very long time, impacting your life for many years.Other Things to ConsiderEstablishing your credit image is not just a one time effort. Continued vigilance and maintenance pays off. In this competitive economy, be aware of other areas of concern that may impact your credit image.Digital Dirt: There is a rise in employers who “Google” prospective job candidates. They are possibly using this as an inexpensive way to do a background search on you. This type of search is not covered under the Fair Credit Reporting Act (FCRA). This law only protects you if an employer uses a third-party screening company to conduct a background search. The prospective employer may search to find if you are connected to any social networks like Facebook, MySpace, Twitter, and/or have your own website or blog. Be careful what you publish on the internet and mindful of the impression it creates. Once in cyberspace, information can exist forever and go before you and your next job interview.Student Loans: As you wind down your education, keep these things in mind that will affect your credit score. Six months after graduation (or you are no longer in school full time) your loans become due. Unless you are in a position to pay the monthly payment, know how the terms of your loan work. You may want to consider deferring the loans for a short period of time by continuing your education past the date of graduation or applying for some other type of deferment long enough to get your living expenses and wages in order. Remember that 30% of your credit score is based on your balance to limit ratios and this includes student loans being reported to the credit bureaus. By making regular, timely payments, your loans will continue to build your credit image.Employment: More and more employers are using credit checks as part of their employee screening process. “People are being turned down for jobs on the basis of things that really have nothing to do with qualifications.”* While we are concerned about the inappropriate use of credit reports and scores, this is a growing reality that students must take into consideration when planning a job search.ConclusionOnce you have established your credit image, regular maintenance is critical. Review your credit reports at a minimum yearly, pay your bills on time, monitor your student loans and use credit wisely. A strong credit image will go before you to pave the way for your future success.*New York Times, August 7, 2009 http://www.nytimes.com/2009/08/07/business/07credit.html

From decade to decade, cheap personal finance has been providing monetary support to every sort of people. It advances amount to fulfil every small or sizable personal demands to the applicants. Cheap personal finance allocate amount that borrowers are looking for, to materialize their wishes in a trouble free or easy way. Cheap personal finance is classified into secured and unsecured form. If applicants have property to place for the loan, secured cheap personal finance is offered. For people without property like tenants and non-homeowners, unsecured option is designed. The unsecured option can be obtained by persons who are unwilling to place collateral against the loan.The amount that you can borrow in cheap personal finance starts from £ 5,000 to £75,000. The repayment period of cheap personal finance is from 5 to 25 years. Finance cheap personal scheme allow even the bad credit holders to obtain loan and execute their demand after proper documentation. So, bad creditors should furnish credit and personal details precisely.Cheap personal finance has cut down its prior rate of interest and offer fresh rates which every person will find affordable. The interest rates vary from lender to lender in the competitive market. So, applicants can take the advantage of this competitive atmosphere and spot a marginal rate which suits his repayment ability.The application procedure of cheap personal finance has gone through many phases and has become faster and easier than before, with the adoption of online device. Approving of cheap personal finance through online method will help to get loan in instant and also it is the most well-liked application process.The borrowers can supervise various demands in a single amount with cheap personal finance. They can purchase cars, consolidate debts, go for holidays, renovate house, weddings and higher education are some preferred ends which can easily be fulfilled with cheap personal finance.

Every internet business owner anticipates learning about the best
web site promotion tip and techniques that will lead them to
operating a profitable internet-based business and to achieving
financial freedom. Individuals who have discovered a web site
promotion technique that produces desirable results are generally
very willing to share their web site promotion tip with others.
It’s funny how that works in e-business. Perhaps it is because
the internet holds so many possibilities that sharing the secrets
of their success is not competitively threatening. In fact, a lot
of money can be made on the internet through information
marketing and the sharing of knowledge.Like other internet entrepreneurs, I have discovered my very own
web site promotion tip that I consider to be the best web site
promotion tip ever. My discovery is, the type of internet
marketing techniques that you use do not matter so much, as long
as you use them consistently and you are willing to accept change
and respond to it. That’s the deal with internet marketing. What
works today may be considered the best web site promotion tip
ever, but the technique may not work well in a month or so. The
internet is always evolving. If internet business owners become
stagnant, they will fail. Consistent use of web site promotion
tips and ongoing adjustment to change are the secrets to success
in the Information Age and relatively in internet business.To make this web site promotion tip work for you, you must
understand the management process. Henri Fayol was the French
business theorist who laid out the traditional view of the
management process which was to plan, organize, command,
coordinate, and control. The basic theory eventually evolved and
became known as the four functions of management – planning,
organizing, leading and controlling. These business principles,
through traditional in context, are completely applicable to
every aspect of internet business including web site promotion.
Therefore, the traditional process of management is an excellent
web site promotion tip that will result in superb management of
web site promotion activities.When it comes to web site promotion, planning is vital. Without
planning you will likely spin your wheels spending time and money
trying to implement a web site promotion tip without results.
Organizing is also of great importance because you have to have
your team, your resources, your thoughts and your plans organized
and coordinated for any web site promotion tip to work.Leading is a term that is generally associated with leading
people – a team or a staff – to accomplish what needs to be done.
In internet business the term implementing may be more
appropriate since many internet entrepreneurs work alone although
they may use consultants or internet marketing specialists for
various marketing tasks. At any rate, you must implement your
plan and any associated web site promotion tips in the third
phase of the management process.Unfortunately, controlling is the web site promotion tip that
many internet business operators overlook. It is easy to get
fired up about creating a plan, getting everything organized and
implementing or launching a marketing campaign. Once the
marketing campaign is off the ground, some people feel that the
managerial role is completed. The truth of the matter is;
however, the launch of the marketing campaign is just the
beginning. That is the point in time that the control process
kicks in.The web site promotion tip of control involves constant
monitoring every web site promotion tip that you implement as
part of your overall marketing plan. Reviewing website activity
logs will reveal the source of the traffic to your website.
Deeper analysis will help you to determine which web site
promotion tip is working best in terms of driving traffic and
converting visitors to buyers. Constant monitoring of conversion
rates will also enlighten you in regard to whether or not changes
to your marketing program are needed. When the need for change is
identified, the management process begins again with the planning
function.

There are countless computer consultants out there. You have the geeks, the gurus, the evangelists, the computer guys, techs, nerds, network consultants, computer consultants and technologists, just to name a few. At the end of it all, regardless of what they call themselves, each provides a different level of service and technical know-how. Too many IT consultants solve every problem by asking you to throw money at it. New computers, new servers, new monitors, new printers, but every time you spend money, you are cutting into profitability. The key is for you to identify the right person for your needs. If you run a company, what you really need is a business technology coach to help you make the right decisions about your technology.A computer consultant is usually only interested in fixing your computers. He is not versed in any business functions and is therefore incapable of assisting you with many additional services that will maximize your information technology investments. The computer guy is great when the printer breaks or when the computer goes haywire, but a business technology coach can offer you significantly more value. Large corporations hire a Chief Information Officer to fulfill this role, but a small to mid-sized business may not need that degree of full time support. In these cases, a business technology coach will serve you well.Business Technology is any technology that serves the needs of business, including accounting, networking, and other office systems. So, while an office productivity software suite (e.g. Microsoft Office) is considered business technology, the Microsoft Xbox is not. The realization that there is a growing divide between recreational gadgets and technologies that can directly impact the business world has led to a new way of examining the direct value of technology. Business technology must add value to your company or else it is just a waste of money. There are so many products to choose from, all with competing philosophies and learning curves. More often than not, you simply accept what came with the computer when you bought it and you make due. Or, worse yet, you fall prey to that fantastic salesperson that promises the answer to all your prayers and delivers another expensive nightmare. So, the next fact you need to accept is that not all business technology is valuable to your business!The key to modern business success is to be sure to align your business goals with your technology plans. Business and technology alignment has become a Holy Grail for large multinational corporations. Because these industrial monsters are so large, anything they can do to make themselves more flexible, more responsive to their customers, is mandatory. Fortunately, most small and medium-sized businesses are agile and fast to respond. Chances are your top customers know how to get in touch with you at any time of the day. However, just because you do not suffer from the problems of these huge dinosaur businesses does not mean you cannot benefit from business / technology alignment. A business technology coach will assist you in aligning your business goals with your technology investments.The second benefit you can derive from a business technology coach is an understanding of your business processes. No two businesses operate exactly alike. Chances are your business practices have developed organically as your company overcomes new challenges. However, organic growth has a tendency to develop substantial inefficiencies that can impact profits. I have seen cases where companies print and mail out zero dollar invoices ($0.00) simply because the system was poorly automated. This is inefficient and expensive, and can easily be remedied. A business technology coach will analyze how you work to pinpoint and correct these inefficiencies.A business technology coach will then use his knowledge and understanding of your computer systems and business processes to assist you in building competitive advantage. According to a 2007 IBM study, a business technology coach should be “…engaged as a strategic partner for process and culture change.” This means that the lonely computer geek typing away for hours without human contact is not the right choice if you want to succeed. A business technology coach will be capable of working with others and must possess advanced communication and social skills to act as an agent of positive change. The computer geek that is incapable of communicating ideas or is lacking in social skills is not what you need.Also, a business technology coach understands that his job is to make recommendations. Remember, you are the ultimate decision maker, so your coach needs to present you with options, instead of ultimatums. In some rare cases there is only one course of action, but in my experience I have rarely encountered them. A business technology coach will present you with multiple options to achieve your goals. However, if so instructed, your business technology coach will make decisions on your behalf based on solid experience and understanding of your objectives.Technology is a fact of life. From cell phones to computers, technology has become a part of our everyday lives. Whether it’s to improve efficiency or to develop new services, companies all over the world are harnessing technology to improve the way they do business. Don’t trust your technology to someone that doesn’t understand business and how you work. A business technology coach can make the difference to your success.

Community media is described by Ellie Rennie (2006), in a broad sense, as “community communication.” Fundamentally, it is elusive to define the term in an absolute manner because it can take so many forms, be applied by so many different groups of people, and be directed at such a wide range of issues. The premise, however, that community media is a facilitative tool for discussion and engagement of the ordinary citizenry has some inherent implications. A major implication is that community media is for the most part independent of the market-driven commercial and mainstream media outlets. This, in turn, allows for different models of community media to offer either a wide open editorial policy or a more fine-tuned approach that is still loyal to the encouragement of community participation. The key characteristics of community media convey a more clear understanding of its definition as well as its depth and dimension in terms of how it takes shape in the civic landscape (Rennie, 2006: 208).The South African definition is that community media are either a geographic community or a community of interest. Ideally then, community media are produced, managed and owned by, for and about the community they serve, which can either be a geographic community or one of interest. “Community media is a two-way process, in which the communities participate as planners, producers and performers and it is the means of expression of the community rather than for the community.”It appears easier to posit an ideal definition of community media than to extrapolate a definition from the actual community-based media initiatives existing on the ground (McQuail, 1994). The media used are different and, as is the case with video, sometimes the medium used itself poses challenges to the notion of community participation. The ownership and management patterns are diverse, even though they can be broadly defined as non-governmental and non-corporate. The levels of community participation are equally diverse. And the aims are quite specifically different, although again, in general the aims are all for some aspect of community development.The concept of community media implies that for communities to be heard at national level, they have to be heard at grassroots level first. The potential to communicate and receive communication is a social good, which should be fairly, universally and strictly equal. Curran and Gurevitch (1991) state that the full concept of citizenship presupposes an informed participant body of citizens, most generally, if we suppose there to be a right to communicate then it implies an equal individual claim to hear and to be heard. Similarly, Freire (1990) observes that the less people are consulted, the less democracy a nation has.Community broadcasting seeks to foster debate about, reach consensus on and build solidarity in promoting and protecting human rights and achieving sustainable development, including peace and reconciliation (McQuail, 1994). Community broadcasting is about both access to and dissemination of information. It acts as media for the flow of information to and from communities, on the one hand, and the national and international levels, on the other hand (McQuail, 1994). It provides access to needed external information as well as advocacy on issues of concern, with relevant policy making levels informed by experiences at the community level and solutions generated therein. In a broader sense, community broadcasting enables greater participation by communities in national and international affairs. It has a dual role – that of a mirror (reflecting the community back at itself) and that of a window (allowing the outside world to look in at its experiences).Fraser, Colin and Sonica Restrepo Estrada (2001) argue that community media provide a vital alternative to the profit oriented agenda of corporate media. They are driven by social objectives rather than the private, profit motive. Community media empower people rather than treat them as passive consumers and they nurture local knowledge rather than replace it with standard solutions. Ownership and control of community media is rooted in and responsible to the communities they serve, and they are suitable approaches to development, (Buckley, 2000). The nature and purpose of community media initiatives should be the most important determinants. Resource shortcomings of any kind can be addressed through alternative strategies. Steve Buckley (2000) observes that democracy and communication are inextricably linked, so much so that the existence or otherwise of certain forms of communications can be a measure of the limits to which democracy itself has developed or is held back.Curran & Gurevitch (1991) state that the nature of community media is participatory and its purpose is development, “processes of public and private dialogue through which people define who they are, what they want and how they can get it. Community participation is thus seen as both a means to an end and an end in itself. The processes of media production, management and ownership are in themselves empowering, imbuing critical analytic skills and confidence about interpretations reached and solutions found. The medium chosen must, therefore, be one that enables, enhances and sustains community participation.From the above considerations, it follows that the choice of media to be used in a local community is necessarily specific to that community. What works in one community may not work in another (Lesame, 2005). For example, gender and age are factors to be taken into account when discussing sexuality, but the manner in which they are taken into account differs across communities. Literacy levels, access to radio receivers in the community at large, familiarity with symbolism and other visual devices used in audio-visual media are other considerations. The choice of theatre, local language newspapers, radio or video – or any combination thereof – is and should be dependent on both internal and external factors (Bessette, 2004).Internally, the choice should address the development aims of the community concerned and build on what forms of communication already exist, especially where the community concerned has a history or tradition of educational music and dance. And externally, the choice should ensure ease and effectiveness of impact on the national and international actors the community wishes to speak to. For example, video is a powerful medium to raise awareness about human rights concerns, but it is also a medium which does not necessarily or typically allow for the complexities of a situation to be expounded on and can thus lead to simplistic interventions for resolution. Participatory community-based planning to make the choice of a medium should take these internal and external considerations into account.

There are many options for buying a group of securities in one product. The most popular ones are mutual funds, segregated funds and exchange traded funds. What they have in common is that these products are an easy way to buy a group of securities at once instead of buying each security individually. The fund can also proportion the securities so you the individual investor does not have to. There are two main classifications for what type of fund you can purchase in terms of costs. It is important to know how these costs work so you can avoid paying too much for this convenience. These products differ in terms of how they are administered, access to the products and their costs.Active Versus Passive InvestingBefore getting into which of the products are suitable for you, there are some aspects that need to be considered so that you understand what the variations are among the products.Active investing is when someone (a portfolio manager) picks the stocks that are in the fund and decides how much of each one to hold (the weighting). This portfolio manager would also monitor the portfolio and decide when a security should be sold off, added to or have its weighting decreased. Since there is ongoing research, meetings and analysis that must be done to build and monitor this portfolio, this fund manager would have research analysts and administrative personnel to help run the fund.Passive investing has the same setup as active investing, but rather than someone deciding what securities to buy or how much of each one to buy, the portfolio manager would copy a benchmark. A benchmark is a collection of securities which the fund is compared against to see how well it is doing. Since everything in investing is about how much money you can make and how much risk it takes to make that money, every fund out there is trying to compare to all of the other funds of the same type to see who can make the most money. The basis for the comparisons is the benchmark, and then it becomes comparing between peers or funds managed the same way. Comparisons in general are done only for returns. The risk aspect of the equation is handled by looking at what type of securities the fund holds or how specialized the fund is.How Do I Know By the Fund Name If it is Active or Passive?The short answer is that you have to get to know how the fund manager operates the fund. Some clues to know more quickly if the fund is active or passive are given next. If they are intentionally trying to pick securities according to some beliefs that they have about the market, this is active management. If the fund description talks about “beating the benchmark” or “manager skill” then it is actively managed. Another clue is to look at the return history. If returns vary versus the index by different amounts each year, then the fund is actively managed. Lastly, the fees may be expensive and have sales loads.If the name of the fund says “Index” or “Index fund” there is a good chance that the fund is passively managed. If the name of the fund says “ETF” this could be a passive fund, but you need to make sure of this because some ETFs are actually active funds, but they are managed in a certain way. Most of the passively managed ETFs are provided by BMO, iShares, Claymore, Vanguard and Horizons in Canada and Powershares, Vanguard and SPDR (or Standard and Poors) and others if the holdings are from the U.S. Most of the other companies would have actively managed funds only. If the fund description states that the fund is trying to “imitate” the performance of an index or benchmark, then this implies that it is copying the index and this is passively managed. From the return perspective, passively managed funds will be very close to the index that they claim to imitate, but slightly less due to fees each year. The amount that the returns are under the index will be close to identical each year unless there are currency conversions or variances in cost which may come from currency fluctuations or hedging that the fund may do. Passive funds typically do not have sales loads as they are geared toward people who invest for themselves.There are some funds that try to mix active and passive management. These funds can be assumed to be actively managed, although their results will be closer to the benchmark than most of the other funds, so this is something to consider if the variation from the index is a factor.Types of CostsWhatever product you buy, there will be a cost associated with buying it, keeping it and selling it. This will be true whether you have an advisor versus doing it yourself, and whichever institution you go to. Even buying your own individual stocks will have trading fees which you must account for. How much you are paying for each product however as well as the advice will make a large difference in what return you will get after everything is done.There are many types of costs to be aware of when you are deciding which products to invest in. This article will focus on the passive funds that make up a growing selection of products for retail investors.The Management Expense Ratio (MER)This is the largest cost for most funds and represents the cost of managing the fund. “Managing the fund” means running the investment company, advertising, overhead and the cost for the advisor or sales person when it applies. Administrative costs like GST within the fund and accounting for trades and record keeping are also part of this cost. The MER is given as a percentage, which is the percentage of the assets that the fund manages or invests over a year of time. If you have $100,000 invested in a fund, and the MER is 0.5% per year, you are paying $500 per year to keep this fund. The cost is subtracted from the return and what you see in your investment statement is your return net of fees, or after fees. The Management Expense Ratio is the management fee plus the administrative costs. The administrative costs are usually between 0.05% and 0.1% of the assets of the fund. If the information you obtain states a “Management Fee” instead of a “Management Expense Ratio” you would have to add on the administrative costs to get the true fee. Seek out the prospectus and look up fund operating costs to find exactly how much the number is.For American funds, this would be called the “Expense Ratio” which is the same thing as the Canadian MER, but advisory fees are not included in the ER. They would be included in Canada for the MER if the product is actively managed. If the product is passively managed in Canada or the U.S., the same names apply, but no advice would be part of the cost since these products are used by people who invest for themselves and would pay for advice separately if they retain it.What Is Tracking Error?In many cases, when you are buying a passive investment, you want to imitate an underlying benchmark or index. Another way of saying this is that you want to achieve the average rate of return in a given market all the time. Since every fund has costs to operate it, you will not get the benchmark 100% of the time because this means that you would be investing for free. The tracking error is the difference between the measured return that the benchmark provides and the actual return that the passive fund or imitating portfolio provides. As an example, if the S&P/TSX index had a return of 5% for a 1 year time period and 10% for a 2 year time period, and your fund had a return of 4.5% for 1 year and 9.5% for 2 years, then the tracking error would be 0.5% each year. Tracking error tends to be pretty consistent over all time periods but not perfectly consistent because the costs of running a fund will vary, and sometimes the act of trying to follow an index can get tricky if that index is very volatile or illiquid. The tracking error is not a fee per se but it is a way of measuring the costs of owning the real fund versus the index that it is being compared to. Tracking Error is also useful in determining how consistently the fund is being managed from a cost perspective.Early Redemption FeeSome companies charge an early redemption fee if you sell their fund within a short period of time. How short the period is will depend on the institution. In some cases, it is 30 days, but it can be 90 days, 6 months, 1 year or some other time period. This fee is designed to discourage quick redemptions or short term trading of the product.Sales LoadsSales loads for passive funds would only apply to a fund that is sold through a sales person. You may be able to get the same fund without the sales person in most cases. Passive investing generally does not have sales loads – but the exception would be if an advisor recommends these funds and charges you some type of fee for the selection. This would be another question to ask if you are being advised to buy a passive fund and are not seeing any direct cost to buying the product.Currency Hedging CostsThis type of fee will occur in funds that trade in non-Canadian currencies and hedge them back so that the price you receive would be in Canadian dollars. The cost of transacting the hedge itself is the fee being described here, and it can range from 0.5% to 1% per year. If the fee is not disclosed, assuming a 0.5% fee is the cheapest that it will likely be. If you are investing in emerging market currencies or non-developed market currencies, the hedges are much more expensive to put in place and can go higher than 1% per year. This is a cost embedded in the return of the fund, but should be examined to flesh out exactly what you are paying to have the return hedged.The alternative would be to keep the securities in their home currencies and whatever changes happen to the foreign exchange rates would be reflected in the price of the product. The fact that currency exchange rates can change is a risk of your investment, but it is not considered a fee like the other fees discussed in this article. This fee does not apply if the fund price is in your home currency. You may have a U.S. dollar account, buy a fund that trades in U.S. dollars and then redeem this fund for U.S. dollars. Until you convert the money on your own to Canadian dollars, there is no currency charge. You would have a conversion charge when you change the final dollar amount to Canadian dollars.Other Passive CostsPassive investing has some unique fees such as account administrative fees, trading fees, foreign exchange conversion fees, spreads on trading, opportunity costs and separate advice fees which are not seen in the active investing world because the account will capture all of these fees.Account Administrative FeesThe account administrative fees are charged by an institution for opening your account, transferring securities in or out of your account, or an annual administrative fee to keep your account open. These fees may depend on how much money you have with the institution, and can be reduced or waived as your account balance increases. These fees tend to be a flat amount as opposed to a percentage, which means they are comparatively small versus the assets that the account may have.Trading FeesTrading fees are fees charged for trading stocks or exchange traded funds. These fees will typically be a flat fee per trade and will depend on how often you trade and what type of investments you trade. Generally, the more frequently you trade and the more exotic the product that you trade, the more the expense. The further you are from home in terms of what you trade, the more expensive the trades are is a rule that applies most of the time. The longer you hold onto an investment, the less trading you will do, and the cheaper the trading fees become over time since this cost would be spread out over the life of the investment.Foreign Exchange FeesForeign exchange conversion fees will occur each time you exchange currency. This could be for withdrawing, exchanging securities, rebalancing among the holdings you have, or getting into securities or funds that are denominated in other currencies. Most of the time, the currency exchange rate has to do with the U.S. dollar, but it can be any currency if you have foreign accounts and do the investing passively.Bid Ask Spreads and Opportunity CostsSpreads on trading refers to the bid and ask price for a given security. When you buy something, you always pay the “ask” price or the higher price that the seller wants to receive, and when you sell something you would receive the “bid” price or the lower price that the buyer wants to receive. The difference between them is called the spread. To know how much this would be, examine a price quote for the fund you want to buy when the market is open and you will see the bid-ask spread when you look at any quotation for the fund. The difference between the bid price and the ask price would be the amount you are paying in dollars. This difference divided by the price of the purchase price of the fund would be the costs in terms of a percentage. As an example, if a fund has a bid price of $8.00 and an ask price of $8.10, you would be paying 10 cents per unit or share as a spread. If you bought the fund at $8.10, the cost would be $0.10/$8.10 or 1.2%. This percentage is a “one-time” fee for every buy and sell pair of trades. The longer you hold your investment and assuming the price rises, the cheaper this spread will get in terms of percentages since the value of the investment tends to rise higher over time. The reverse would be true if the value goes down for a given investment. The spread can vary over time and depending on how much volume is trading at a certain time of day.If you decide to fix the price for buying or selling a security instead of going in at the prevailing price in the moment or “the market”, you run the risk of not getting the security or having to pay much more for it at a later date. This is called the opportunity cost and it will vary a lot with each trade but it does exist and would be considered if you are trying to time your trades and if you are doing it frequently.Advisory FeesSeparate advice fees refer to a scenario where you would pay separately for advice and the products you are buying. This would be relevant if you hire a fee for service financial planner, advice only financial planner, money coach, or consultant who charges a flat fee for advice separately from whatever products you invest in. If you do it yourself, there are costs for research, courses or software that you would purchase to help you do the passive investing. Once again, if you have a traditional advisor, you are not seeing these costs itemized anywhere because they are part of the MER of the funds you hold in their account, but these costs would be standing on their own if you invest for yourself and buying your own securities.Fees of Holding One Fund Inside of Another OneIf a fund that you want to invest in has other funds in it as part of its holdings list, then you will pay the MER fee for the fund you are buying as well as the fund(s) that the fund holds. The best way to check if this is happening is to look at the holdings list. If a fund holds another fund, it tends to be a large holding so a fact sheet with a top 10 holdings summary should provide good information. If you want to be really thorough about this, you would have to get an entire holdings list with each and every holding in it so you can see if there are minor holdings that may be funds. This is typically not necessary as the further down the holdings list a security is, the smaller its weighting is and the less impact the fees will have on your total cost.The actual numbers for each of these items will differ depending on specifically what the fund is and how it is managed. If the fee is necessary to operate the fund, like currency hedging, then this would be included. Whether a fund holds stocks or another fund can also impact withholding taxes if the fund is investing outside of Canada – particularly for U.S. products. This topic can get complex, so it will not be discussed here. Some funds will contain other funds to get access to illiquid markets, or to trade in parts of the world that have hundreds of securities. Buying a fund in these cases would actually save on time and trading costs, so it can be justified depending on the market being invested in.Intangible CostsThe key takeway is that you need to do a cradle to grave analysis of what you have and see the costs from beginning to end to get an idea of what is really happening. Ideally, the costs should factor in time spent, effort spent on research, tools used for investing and costs of discipline and assurance which would be available when dealing with an advisor that may not be there when you are doing it yourself. When comparisons are done to the market index or benchmark, this is really an ideal (free) comparison which is not realistic. You cannot buy a free version of the index – the ETFs come closest to this and are represented as the passive way to invest.Where to Find These Costs?The most comprehensive place that will contain the most detail regarding fund costs is the prospectus. This can be found be searching for the product name and the word “prospectus”. If you do not know the exact product name, you can search the fund management company only and then search for the product name on their web site. The fund companies will have these documents with the regulator as well as their own web sites and they will be typically in PDF format which can be read and downloaded from your computer. A simplified prospectus would also have the same data that you would be looking for regarding fees.

A lot of big money managers have an eye on stock market 2015-2016 looking for the best investment opportunities because that’s their job – to make money in the stock market. The problem is that after six straight years of rising prices investment opportunities in the market are hard to find. Where might money managers, and you, find them?Believe it or not, it’s probably easier for you to take advantage of the best investment opportunities in 2015 and 2016 and make money in the stock market than it is for a money manager with billion of dollars to deal with. All you need is money in a brokerage account with a discount broker and you’re in business at a cost of about $10 per trade. Your trading activity does little to affect the market price; your trades are executed swiftly and are merely a blip on a screen. Big trades (for millions) can affect the market price, can be cumbersome, and can be traced like footprints in sand.You are not at a disadvantage, and you have a lot more potential investment opportunities and ways to make money in the stock market in 2015 and 2016 than you may be aware of. The question is: are you going to keep buying mainstream stocks that move with the market and hope that prices will continue to rise indefinitely into the future? Or, are you going to look elsewhere for opportunities in preparation of a change in market trends? Let’s look elsewhere.By early 2015, two sectors or industries were moving contrary to the market in general and both hint that a change could be in the wind: oil and precious metals (gold and silver). Stocks in both of these industries are a popular and simple way for the average investor to make money in the stock market IF the timing is right. Keep your eyes open as the markets unfold. Oil and precious metals stocks have been falling in price while the market in general was hitting new all-time highs going into 2015. If trends change they could be some of the best investment opportunities around in 2015 or 2016.Now, let’s get a bit more creative. The future could see rising interest rates and slower economic growth. Both could hurt future corporate earnings. Since good growth in corporate earnings has been the cornerstone of this 6-year rising market, what would happen if interest rates rise significantly and/or earnings fall? You guessed it. The major market indexes like the Dow, S&P 500 and NASDAQ could become volatile and tumble. If this happens, where are the best investment opportunities and how do you make money in the stock market?Can you, as a small investor, make a bet in the stock market that interest rates will go up? Yes, you can by simply buying the appropriate ETF (exchange traded fund) in your brokerage account. Can you bet that the market will become more volatile? Same answer as above. Can you bet against the market in general or against specific sectors in the market and make money in the stock market if you are correct? Yep, all with ETFs.The vast majority of investors will lose money when things change, because they don’t really understand the dynamics. Markets change, and you must keep this in mind. The best investment opportunities often occur with a change of trend. The past six years have been unusual to say the least. It is not normal for interest rates to be this low. Nor is it normal for the stock market to go up for six straight years.The difference between the average investor and the big money guys is that the latter know that the years leading up to 2015 were unusual, and they understand market dynamics. That’s why they’re racking their brains in search of the best investment opportunities for 2015 and 2016 – just in case trends change.It’s true that it’s always possible to make money in the stock market, but it’s certainly not easy to do when the market indexes are tumbling. Be prepared, because change could be in the wind. The best investment opportunities are always out there. Now you have some ideas as to where to look to find them in 2015 and 2016.