"Because good analysis, is good money"
-Invizible INK

Learning by Doing

You can read as many books as you want about investments, markets, or money management but until you actually put it into practice you most likely won't be fully absorbing the information. Sure you can paper trade or use a demo account but there are always real life factors that can't be simulated.

For example, you aren't always emotionally attached to your demo money. If you lose all your demo money you can always press reset and start again. You say things such as, "Oh in real life I wouldn't have done that anyways." or "I was just trying something new to see how it goes." No matter how hard one tries, demo money just isn't real.

Another good example is execution. Can what you do in practice mode be done in real life? When you click buy & sell on your demo trading platform, the trade always goes through, but in real life does that really always happen? What happens when the market is overwhelmed and the prices gap or spike? Can you still close your trade fast enough?

Remember to take these types of factors into account when you practice! Remember, whether you pay to take a course or just dive in and trade for real, you're probably going to pay somebody. Remember not to risk anything you can't afford to lose!

see you next time,... because thePaperBoy knows his paper

Ethanol versus Sugar stocks

Take a look at the latest Barron's roundtable. Sounds like owning sugar rather than ethanol stocks is the way to go to play the rising demand for ethanol according to money manager Felix Zulauf. Since February 2006, the price of sugar has fallen 50% to 11 cents a pound. That's below production costs of about 14 cents in Brazil and India, the two largest producers! This may mean that sugar production is therefore on the decline, while demand is rising due to ethanol. Brazil is also the producer of 5 billion gallons of ethanol a year, and is planing to increase that to 8 billion gallons within the next three years. 22% of Brazil's total fleet of cars are Flex cars, and the government wants the percentage to rise to at least 30%.

Brazil also exports ethanol to the U.S., Japan and China, all of which are raising their demand. "In the past", says Zulauf, "when sugar started rising from a price below the cost of production, it rose 100% or more, on average." His target price is 20 cents. Note that according to Zulauf a 30% increase in the price of sugar (far less than the increase from 11 to 20 cents he's predicting) would eliminate ethanol's price advantage over gasoline. Sugar futures are therefore a better play on ethanol than the sugar-based ethanol producers such as Cosan (CZZ). Investors who can't access sugar futures may consider two commodity ETFs: the PowerShares DB Agriculture ETF (DBA) and ELEMENTS Linked to the MLCX Biofuels Index ETF (FUE).

Spotting Successful Strategies (Part 2): Organic Growth vs. Acquired Growth

Growth. We all know what it means. We have all experienced growth in one way, shape or form. We grow physically and mentally, the children we have grow up, the plants and trees around us grow, the cities we live in grow and so on. However how should a public company grow?

Basically there are two ways in which a public company can grow: organic growth or acquired growth. Which method is the proper avenue for corporate growth? Should a company be using a balance of the two methods? The bottom line is which type of growth shows the public company's investors, clients and general public that they are demonstrating successful strategies and ultimately building shareholder equity and increasing shareholder value.

Organic Growth

Building a public company via organic growth means that the corporate strategy and focus is on internally growing the company through developing new products, services or intellectual property. All in all the company's primary objective is to perform needs analysis, design a product or service, develop that product or service, implement it through marketing channels and evaluate its level of success in the market. A company that is growing organically will find itself dedicating all of its resources into a product. Funding the research and development department, funding the manufacturing division, funding the quality assurance department, funding the marketing and sales teams, etc. At the end of the day, the public company's burn rate is almost entirely comprised of money spent on a product or service.

Acquired Growth

On the other hand, building a public company via acquired growth is the exact opposite. Instead of devoting man power, dollars and time into developing that new miracle product or the latest and greatest, this company will dedicate its resources to acquiring products, services and intellectual property as opposed to building them in-house. The public company will seek technology, products and assets it sees fit to their corporate strategy in order to grow their organization and ultimately build shareholder equity. The clear benefit to growth via acquisitions versus organic growth is time. Money may be saved with this method as well, but harnessing efforts in the right direction for the right reason is priceless. At the end of the day, the public companies need to build shareholder equity. By doing so, it proves to the investors that the public company is positioning itself for success in the market.

There is no secret that we all look at a publicly traded companies success in its stock price. However, the secret is in how a publicly traded company can move the stock price up. It is not within the product that the company invents, develops and markets. Rather it is how the company seeks suitable, profitable and feasible assets to acquire. When these assets are procured, they will increase shareholder equity. Building shareholder equity will demonstrate a public company's successful strategies and as a result increase shareholder value. By increasing shareholder value the stock price will naturally correct itself.

Succeed by seeking and acquiring growth, not by attempting to develop it in-house.

Handling Your Paper

Everyone knows someone who has difficulties managing their own finances. Stop and think about it for a second. Have you ever wondered if the person you go to for financial advice actually knows more than you do? It's rare for people to question the the knowledge of an "expert".

Have you ever stepped into a casino and made a few losing bets? Have you ever felt the urge to unload your entire bank account on the next hand because you had a very good feeling about the next card? Most people have, and lost.

Like a casino, the stock market can work the same if you don't understand its intricacies. You place a trade and wait for the outcome much like dropping a quarter and pulling the handle. The numbers spin as fast as the dials on the slot machine. Sometimes you win, but most times you lose when you're guessing and gambling. We've all heard stories of stock market gods who never lose as much as we've heard horror stories of average joe's that just can't catch a break.

Here is today's reality check:

- Winner's don't gamble, they take calculated risks.
- Winners use proper money management techniques and play only when the odds are in their favour.
- Winners don't trade with emotions, gamblers do.

I don't care if you, your mom, and your neighbor's dog all think that next stock is the big one. I would not unload my bankroll on it, nor would I chase potential gains to recover losses. If you want to be a winner, you need discipline. Here's a few simple rules you can follow: Only risk 5% of your bankroll per trade or pick, don't trade with emotion, don't gamble-analyse your pick.

See you next time boys and girls,

... because thePaperBoy knows his paper

Learn How to Invest Money – Books & Seminars

When beginning your quest to financial freedom, education and knowledge still stand as the most important part of your journey. There are many books out there which will help you learn how to invest money, or leverage your assets. The most important part of each book is not the content directly but the ideas it creates and the actions you take to apply them. Among my personal favourites book list are:

Rich Dad, Poor Dad – Robert Kiyosaki
Cash Flow Quadrant – Robert Kiyosaki
Escaping the Middle Class – Doug Anderson
4 Hour Work Week – Timothy Ferris

I have read many books in the past few years, but these books do stand out and have taught me priceless lessons in how to invest money, how to manage my finances, how to save on taxes, how to operate a business, and how to set financial goals. You will find many lessons in these books to crossover, as with most industries, and the more you are able to connect, the more effective you’ll probably become as your own financial planner.

There is an infinate number of seminars that promise results, claiming you can learn how to invest and make money easily with their system. How do know which works and which doesn’t? The truth is you can’t usually know until you try. As with everything else, if you want to learn how to invest money, you have to treat education as an investment as well. You have to spend time and money if you want a successful financial future.

Losses are normal and you will have to take some hits here and there with bad courses, and bad deals. learn what made them bad, see where you made the mistake, and know how not to make that mistake again.

A few points on what to look for in seminar:

1. Do a google search and try and dig up some information on the company sponsoring the event and the speaker(s) presenting.
2. Do some background research and learn a bit about the topics before walking into the presentation.
3. Ask people about the seminar. Someone will know someone who’s attended that seminar in the past. Ask what they think.

Financial freedom is only a dream to many. If you break down your financial goals, and educate yourself, you’ll slowly realize that there are options wherever you are, despite your age, your credit and your savings. Just remember, your biggest hurdle is within yourself. You have to find your passion to drive and succeed. Take the initiative and educate yourself.

We can all make money, but do we all know how to spend it?

We all have to spend money. There's no way around it. Food cost money, toilet paper cost money and the gas that you used to get these items cost money. No matter how disciplined you are with your money you're going to have to spend it. 

Don't despair. There's hope:

Some banks have credit cards that allow you to earn points that you can later redeem for cash from your gas and grocery purchases.  In essence, you're getting rewarded money for spending money.

On average they'll reward you 5 points for every dollar you spend on gas or groceries. Then after you collect 5000 points. You get a check for $50 up to $300 for the year. So, if you do the math, you're getting a 5% return on the money you're spending to survive.

Sweet huh?

That's the same kind of return as having $10000 sit in a of rare High Yield savings account that gives a return of at least 3% for a year.

So you could either spend around $500/month on Gas and groceries and live normally for year and collect $300.

Or...

You could put away $10000 for a year, eat Macaroni and cheese with ketchup for and walk everywhere you have to go 12 months and collect you $300 in earnings instead.

Sure you'll have an extra $10000 the second way, but something tell me you'll be a lot happier earning your $300 using the credit card.

Fineline Holdings Inc. - Press Release April 09, 2008

Fineline Holdings Released a new press release yesterday as posted on http://www.pinksheets.com/pink/quote/quote.jsp?symbol=fnlh.


Company Upgrade: Investment Tutorial for Shareholders of Fineline Holdings, Inc. Apr 08, 2008

(M2 PRESSWIRE via COMTEX) -- InternationalStockTargets.com is focused on helping investors make money in any market conditions. Our goal is simple, to help walk investors through the proper trading formulas to see success when investing in the markets. Shareholders of Fineline Holdings, Inc. (PINKSHEETS: FNLH) who would like assistance when trading in the equity markets are being offered a free subscription to www.internationalstocktargets.com.

Our main focus is finding growth stocks, that present high reward opportunity with lower than usual risk potential. With the markets the way they are right now, it's becoming increasingly difficult to lock in profits, and most investors are satisfied with not losing money right now, when the real goal should be to make money. If you are tired of losing on investments do not hesitate, sign up now to www.internationalstocktargets.com for a free subscription.

Our subscription will include:
- Email alerts when a growth stock hits our radar.
- Training tutorials for novice investors, on how to capitalize on the present market conditions.
- Advanced trading options for sophisticated investors.
- Institutional and brokerage investment tools.

Don't hesitate to sign up now. Our investment knowledge is at your disposal.
This Monday during the last hours of trading, Fineline Holdings was up 65.00 percent with a volume over 1,300,000.

On Monday, April 7th, 2008, In an effort to continue to build shareholder equity, Fineline Holdings, Inc. stated that it will be expanding its reach to provide merchant bank consulting, and corporate finance advisory services to other microcap issuers. These micro-cap opportunities are typically either in operational or financial difficulty and may need corporate restructuring, merger & acquisition advisory services, and bridge financing. They are typically facing market awareness issues and an inability to attract corporate financing and require the help of serious, experienced managers to restructure and turnaround public company operations in an expedient manner.

Spotting Successful Strategies (Part 1): Building Shareholder Equity

When most of us look for company successes, we naturally gravitate towards the latest and greatest product they just released or a really sought after service which the company provides. As a result, we as consumers look at their bottom line - profits, revenue, EPS, ROI, etc. Basically how much revenue is the company generating. Yet if you look at many companies with huge success on the Fortune 500 list, they have a different focus. Instead of spending millions of dollars on research and development, designing the product, developing the product, putting the product through the quality assurance process and so on these other companies are spending millions of dollars on purchasing assets. Whether it be real estate, buildings, manufacturing plants or chattel, these companies are acquiring acquiring acquiring as opposed to inventing, developing, testing.  

Having said that, which is the proper focus? A company that is product-centric or a company that is acquisition-centric? A company that is product-centric may be successful but the longevity of that success is short fetched. Long term success cannot be achieved if product is the only thing a company is focusing its resources on. At the end of the day, product does not increase your stock price. Product does not prove to investors of that company that the company is moving towards building shareholder equity and shareholder value. Product will sooner or later become out of date, obsolete or useless. However, what does poise a company for success is building shareholder equity and shareholder value.  

How you build shareholder equity is acquiring assets which in turn equates to a tangible bookable asset in the company's books. Once the books are audited then there is no question that the company has X amount of dollars in assets and Y amount of dollars in equity. Now when an investor looks at the company, there is proof in the numbers. Investors believe these numbers because they are US GAAP (Generally Accepted Accounting Principles) standard audited financials.  

This is a proven template that many companies use.  Companies such as Apple, Google and Starbucks all are focused on purchasing assets to build shareholder equity.

When you build shareholder equity, shareholder value increases as well.  

Fineline Holdings Inc. - Press Release April 07, 2008

A news release that was released yesterday on Market Wire announced the addition of merchant banking advisory services to Fineline Holdings Inc.'s current business interests.

This merchant banking advisory helps companies resolve operational or financing issues in micro-cap markets according to the press release.  This addition is meant to help increase shareholder equity in both the merchant banking advisory and in Fineline Holdings Inc.

Fineline Holdings seems devoted to building shareholder equity and is on the right track.  Although it is a pinksheet company,  I believe a conservative investment for at least a 6 month term will prove to be profitable.

I give it my BUY recommendation for the short term! 

For more stock information on Fineline Holdings, I've added a Google link.  You can visit by clicking here.

Learn How to Invest Money - Beating Back the Short Attack

I came across this great article that talks about short selling, a multi-million dollar investing-industry gold mine. As an investor, you have to be weary of short sellers when you are learning how to invest money, as this could affect you, especially in junior markets.

Beating Back the Short Attack

By Rich Duprey March 24, 2008

Since everyone loves a winner, it's reasonable to assume that everyone hates a loser -- everyone but short-sellers, at least. These contrarian investors bet that hot stocks are primed to fall, aiming to turn their pessimism into potential profits.

This week, we're looking at companies on the American Stock Exchange with the biggest decline in the number of shares short. Combining that with the collective intelligence of Motley Fool CAPS, we'll see which of these companies Fools believe have the power to make short work of short-sellers.

Of course, this isn't a list of stocks to buy -- or short! These stocks could have serious problems that warrant their short interest, but they might also be stricken by short-term troubles. Only Foolish due diligence will tell you for certain; our 89,000-strong CAPS community offers a good place to start. Most of these companies are generally well-liked, as most have garnered three CAPS stars or better.

Feeling the squeeze

Perhaps the first thing you would notice is that while we're looking at stocks that have seen the largest decrease in their shares short, five of the seven companies have actually seen their shares-short count rise! Why, for example, would Golden Star see the shorts pile in on its stock despite an increase in share price that would seemingly position it for a short squeeze?

Short-sellers may have been emboldened by the fourth-quarter report issued at the end of last month, which underscored the company's January announcement that while the Wassa mine produced yet another record achievement, the Bogoso mine promised a less-than-stellar return. Management's lowering of guidance for the next year would seemingly belie the rosier expectations it has put out for the mine.

Yet they probably did not anticipate the collapse at Bear Stearns last week that precipitated a spike in gold prices to more than $1,020 an ounce just 10 days ago. While the Fed's recent actions have caused an equally dramatic plunge in gold prices to $920 an ounce, they also have some analysts predicting the peak of the commodities bubble.

Investors seem to recognize the possibility that riding the golden rails may soon be coming to an end, but CAPS investor goofypicker recently asked if anything has really changed in the market? The answer in the pitch is no, but goofypicker predicts continued volatility.

Many speculators are [panicking] and claiming that this is the end of the "commodity bubble". I don't think so. ... The Fed continues to pump liquidity into the market, the interest rate continues to decline, inflation continues to increase and the dollar continues to fall. ... Precious metals will experience quite a bit of volatility and the gyrations may be tough to handle but I think due to the fundamentals ... that a year from now precious metals will be much higher.

Earlier this month, CAPS All-Star Gedunken found a more fundamental reason to think Golden Star will outperform the market. He cited new management and better operations at its mines as reasons to remain hopeful.

This company has been hurt by poor management and failures to meet quotas as well as a basic dislike from the goldbugs because of some of its business practices. But with new leadership at the helm and the mine now operating at quota, the [company's] fundamentals should be turning around. Coupled with the recent rapid increases in gold prices, a small mining company like this will benefit significantly, although usually a bit later than the big miners which have already begun their moves up.

Speak upYou've heard from CAPS investors -- now it's your turn. Share your views with the CAPS community: Squeeze 'em till it hurts, or short 'em till the sun don't shine? May the best argument prevail!