Category Archives: Business & Careers

US Independence Day – Should investors buy into the American Dream?

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·         US valuations are at their long term average

·         US economy accounts for 19% of World GDP

·         HL analysis shows only 3 out of 77 large cap US funds beat their benchmark

Adrian Lowcock, Senior Investment Manager of Hargreaves Lansdown, looks at the prospects for the US economy on the eve of Independence Day;

“The US economy is much further down the road to recovery than the UK and Europe.  The banking system has been fixed and the country does not have the problems that still exist in Europe. We can see the light at the end of the tunnel in the US and sustainable growth may be achievable.

“Many US companies benefit from strong management teams, are profitable businesses and operate in an environment of improving growth.  Many American companies have a consistent and long term track record of being able to grow profits. In the world of uncertainty a premium is being attached to those businesses that can continue to grow.

“Whilst overall the US stockmarket is not cheap, there are still areas which offer value and investors get access to companies with huge growth potential.  The US has a long history of encouraging entrepreneurs to develop and grow business.  The US has a large smaller companies sector which is full of businesses looking to grow into global leaders. Investors should make sure they have some investment in the US Market within their portfolio.”

US Economy

The US Economy accounts for 19% or nearly 1/5th of the world’s gross domestic product.  Economic outlook in the US is improving with GDP growth forecast by the IMF at 1.9% for 2013 and 3% in 2014.  The threat of a “fiscal cliff” was largely delayed; bank lending conditions have improved from low levels.

 

Household debt as proportion of disposable income has fallen back to 2004 levels. House prices started to rise in 2012 and investment in residential property has followed.

 

Unemployment is falling with major banks* predicting the unemployment rate will be around 7% by the end of 2013.

 

Rising house prices should help rebuild household finances, as will improving employment, providing support to personal consumption.  Low borrowing rates should be supportive of increased spending, while businesses encouraged by the improving financial conditions and healthy profits may well increase investment.

 

Shale gas could be transformative for the US economy.  According to the U.S. Energy Information Administration it will keep market gas prices low at around $4 per million Btu until 2019 with prices rising slowly thereafter. This could rejuvenate the industrial sector.

 

Risks to US Recovery

 

The biggest risk is the early withdrawal of the Quantitative Easing programme.  As the economic data, such as unemployment falling below 7%, improves it puts pressure for the Federal Reserve to roll back on further QE. The US has not addressed its budget deficit and the US lacks a plan to reduce the debt. As such there are risks of further political entanglements over raising the debt ceiling, both of which result in a higher sovereign risk premium.

 

Investing in the US

 

The US stock market has performed well in recent years recovering from the financial crisis having returned 103% since March 2009 compared to the FTSE 100 and the FTSE Europe Ex UK returning 80% and 62% respectively. The US stock market is around its long term average valuation with a P/E at 21.98 compared to its long term average of 23.8 times earnings. Even so there are areas of the US Market that remain attractive.

 

The challenge for investors is how to access the US market. Analysis by Hargreaves Lansdown shows that large cap active managers continue to struggle in the region with only 3 out of 77 funds in the IMA North American sector out-performing the S&P 500 over 3 years and 6 out 68 able to do so over a 5 five year period.

 

Investors looking for large cap exposure should consider US tracker funds, , such as HBSC American Index or I-Shares S&P 500, to give access to the world’s largest stock market whilst keeping fees low. For those wishing to access US smaller companies our preferred fund is Legg Mason US Smaller Companies.

 

* Bank of Tokyo-Mitsubishi, Barclays, Citigroup, Deutsche Bank and UBS


Chinese Shanghai Composite index falls 5.3% on Monday

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Recent actions by the Chinese regulators to curb lending has further unnerved investors already unsettled by recent comments from Ben Bernanke. The interest rates Chinese banks charge each other surged last week to record highs before falling back.  And following a recent statement by the People’s Bank of China, the Shanghai Composite Index fell 5.3% Monday night.

 

Adrian Lowcock, Senior Investment Manager, at Hargreaves Lansdown;-  

 

“China’s new leadership is addressing some of the risks that have been building up in the banking system, inevitably this could result in some short term pain, possibly impacting on growth but it should benefit China in the longer run.  Chinese stock markets do look cheap at present,  based on 20 years of information.   In addition it is important to remember that China is a state-controlled economy and therefore it is very difficult to make a clear judgement on the accuracy of the information being provided.   There are some concerns China’s shadow banking system will spiral out of control, however it seems unlikely the People’s Bank of China will let the system fail.“

 

“In line with their 5 year plan China is undergoing a change from an export driven manufacturer to a consumer focused economy. This transition is not going to be smooth and there will be some bumps along the way.  China continues to grow, at around 6 to 7% per annum, but like all emerging markets this does not lead to a smooth rise in the equity market.

 

In 2007 investing in China was very popular and as a result valuations rose to very high levels. The market has underperformed both developed and emerging markets since. There are clearly issues in China’s financial system and authorities are now taking action to deal with these. For long term investors that want to have exposure to China this setback could be providing an opportunity to invest. Company earnings are rising and valuations are looking much more attractive. Most investors can get sufficient exposure through a well-diversified emerging markets fund such as First State Asia Pacific Leaders which has 23.9% in the region or Aberdeen Asia Pacific which has 18.47% in the area.   For investors wishing to take a more adventurous approach and are able to tolerate a higher level of risk then Jupiter China, managed by Philip Ehrmann, provides exposure.”

 

Top 3 Ways You Can Promote Your Business

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There are many reasons to start a business (passion, a desire to be seen as an expert, among others), but no matter the reason for why the business was formed in the first place, a business has to stay afloat financially. To be financially sound, promotion of your business is necessary. Pick new media, traditional media, or combine both to promote your business and get it the recognition and customers you deserve.

Find Your Customers and Hang out Where They do

3 Ways You Can Promote Your Business

Top 3 Ways You Can Promote Your Business

 

Image via Flickr by Rosaura Ochoa

Find your customers and go to them. This sentiment is applicable to both traditional advertising efforts and new, social efforts. Your business is only as great as the customers who drive it so finding that target audience of consumers is imperative. Not just any person will work, but rather, a strategy for who will fuel your business the most should be implemented.

When using traditional media efforts, find out if your target consumer hangs out in coffee shops, at the library, at the senior center, or in the city park. From there, print out flyers, distribute business cards, and join any organizations in those same areas.

When using new media efforts, look for tweetchats where your consumer is hanging out. Tweetchats exist to talk about books, social media outlets, sewing and other hobbies. By participating, connecting and finding out what others are talking about in the field, you’ll be surrounded by those who can find a benefit in your company.

Make Yourself Known

Making yourself and your business known is more than just distributing flyers and connecting online, though there is that. To make yourself known includes these things, but also goes beyond to establishing yourself as an expert, attending conferences in your field, and developing a large presence both online and off.

Incorporate traditional media efforts by handing out a large amount of business cards, advertising on radio and television, and taking out an ad in your local newspaper. Decal and magnet your vehicle, or make t-shirts for your biggest fans to wear.

To incorporate new media efforts into your business strategy, consider creating Facebook, Twitter, Pinterest, Google +, LinkedIn and YouTube accounts. Also, take part in or host a webinar, write a blog, create a video blog, or have a QR code tied to your business. Creating Slideshare presentations, as Lindsay Rosenwald has done, will help you promote your business because you are sharing your expertise with a presentation you have created.

Expand on Word of Mouth Marketing

If you’re producing a quality product (tangible or intangible) and you have loyal customers and clients, word of mouth marketing is the greatest tool at your disposal. Referrals for your business will increase as you form relationships with your customers and continue to offer a product and service that people can stand behind.

Increasing word of mouth marketing is in the business owner’s hand and can be done by asking for referrals, and requesting that current customers review your business on top review sites like Yelp, Google, Yahoo and Trip Advisor. A customer loyalty card or referral card with a deal attached will also work to promote your business.

As a business owner, promoting your business is essential, but doing so in the right ways will secure longer lasting customers who are loyal to your work and products. Encourage word of mouth, make yourself known and be strategic in your promoting to reach maximum potential.

5 Study Techniques for Teens Preparing for the SAT’s

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Taking the SAT’s is a big deal. A good score can help you get into a good school. It can also help you qualify for great scholarships and grants. Before you take the SAT’s, it’s a good idea to study, so that you’re prepared.

Study Early – Don’t Crunch

Study Techniques for Teens

Study Techniques for Teens

 

Image via Flickr by MC Quinn

One of the worst things you can do for any test is to crunch. If you stay up late the night before the test, trying to cram everything in your mind, you won’t remember anything when you go to take the test. Instead, start studying long before the test is scheduled. Study a few things at a time, for the best results.

Consider a Test Prep Program

SAT Prep programs are a great way to study. They help you prepare for exactly what will be on the test. They also put you together with other people who are studying. Working with a study group can help you retain the information that you’re studying. Whether you’re studying with a group online or in person, it’s a great way to make sure you go over exactly what you need.

Take the Practice Tests

If you feel like you’ve studied enough, go ahead and test yourself. Taking a practice test will show you whether or not you’re ready to actually take the official test. If you bomb the practice test, you may want to go back to studying. However, if you ace the practice test, go ahead and schedule the official. The practice tests are a decent gauge of how well you’ll do. The practice tests also help you understand the layout of the test, which can help you when you do get to the official test.

Get Rest

Preparing for the SAT's

Teens Preparing for the SAT’s

 

Image via Flickr by Chris March

One thing that a lot of people forget when they’re getting ready for a big test is that they need to get rest. Your brain needs this rest to be able to remember the information you’re feeding it. If you’re staying up late every night studying, then getting up early every morning for class, you’re probably not retaining as much information as you’d like. Getting a good night’s sleep each night can help you keep up with what you study.

Try Different Study Types

Don’t get stuck in one study type if it’s not working for you. Some people do well with reading and retaining information. Other people need to write things down to remember them. Still others do best when they hear information. Try out a variety of ways to go through the information you’re studying. Flash cards for vocabulary are great, because they incorporate a variety of learning styles. You can write down the words and definitions, read them on the cards, and read them off with others, allowing you to hear them.

Studying for the SAT’s can be stressful. Make sure that you give yourself the time you need. In addition, when you study the things that you know will be on the test, you are saving yourself time and energy. Though studying can be difficult, it doesn’t have to be horrible.

5 Ways to Help Your Children Financially Prepare for College

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As secondary education continues to get more expensive, teaching your children financial responsibility, as well as helping them out with the monetary burden of college, becomes crucial. While you always want your children to have it better than you did, teaching them how to budget and handle money is important not only in saving you some cash, but developing them as productive people. Here are a few simple way to get your child financially ready for university life.

1. Have Your Child Get a Job

Financially Prepare for College

Ways to Help Your Children Financially Prepare for College

Image via flickr by Waponi

You should have your child get a job in high school. This teaches him responsibility and how to make money. By the time he reaches college, don’t just hand over money. Offer to supplement his income for spending money, but only if he gets a part-time job.

Although college does require studying and class work, there is still a lot of downtime for your child to pick up a 10 to 20 hour a week job. By being employed and earning some of his own income, your child will learn to appreciate the money he gets.

2. Prepare a Budget

Before your child heads off to college, sit him down and show him how to make a budget. Demonstrate the differences between wants and needs and mention that he doesn’t have to pay for other people, be it food or entertainment. List all the different categories of expenditures and what percentage of his money should go to each piece of the pie. This will teach him not to overspend on frivolous things.

3. Utilize Apps

Smart phones offer quite a variety of apps to help money management become simple. Mint is just one of many free apps that allows you to view your bank accounts, income, and expenditures. It also has an alarm that goes off when you are reaching your spending limit. Because the younger generation is glued to their smart phones, why not give your child a constant reminder of budgeting if he is going to be on his phone anyway.

4. Teach About Investing

Often, parents will just give their children money or a credit card when they go to college, but this is actually counterproductive. If you feel you must hand over money, make it into a learning experience. Give them $500 to invest in stocks. The sooner they learn about the risks and benefits of the stock market, the better. Exploring the best aggressive growth stocks can offer insights into companies with high growth potential, such as NVIDIA Corp.

You can even make them read about financial investments. One such book is Fisher Investments on Materials, which can benefit both new and seasoned investors about the materials market, which is ever-changing and growing.

5. Take Out a Student Loan

While this may not seem like the greatest option, the learning value is incredible. Even if you don’t have your child take out a traditional student loan, have him pay you back some of the money. You don’t have to make him sign an official loan with you, just put forward all the information.

Your child will learn about interest and how to pay for a loan on a monthly basis. This will prepare him for the real world when he purchases a house or a car.

Teaching your child fiscal responsibility is a difficult task. But the sooner you teach him the ins and outs of handling money and meeting financial obligations, the more able he’ll be to deal with it once he is on his own. College is just the first step of taking off the training wheels.

BlackBerry targets the best and brightest women in the UK for BlackBerry Scholars program

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aliciakeysBlackBerry Scholars Program – a multi-level strategy to engage young women across the globe in Science, Technology, Engineering and Mathematics

BlackBerry is reaching out to women in the UK to urge them to apply for the new BlackBerry Scholars Program, an initiative designed to inspire women globally to enter and develop careers in the fields of Science, Technology, Engineering and Mathematics (STEM).

Led by BlackBerry Global Creative Director, Alicia Keys the BlackBerry Scholars program will offer ten full, four year university scholarships to outstanding female candidates. The BlackBerry Scholars Program is available to women across the UK and will provide scholarships to outstanding applicants who are seeking degrees at accredited local colleges and universities in the areas of STEM across the UK.

“Women are underrepresented in fields of science and technology, and we feel strongly that it’s time to drive a change,” said BlackBerry Global Creative Director, Alicia Keys. “It’s important to connect the dots for young women in school and college, and show them that careers in science and technology are within their reach. And when women do land these jobs, it’s vital they receive the mentoring and support they need to advance in their careers. I’m proud BlackBerry is demonstrating leadership in women’s education, both in school and in the workplace, and giving back to its most loyal users in such a profound way.”

Applications are now open to candidates in the UK, who are interested in the scholarship, and will close on June 26 2013. The scholars will be selected by a panel of inspirational and accomplished women, led by Alicia Keys, who will recruit candidates based on their academic merit and passion for entering the mobile computing industry.

This scholarship program is the first step in BlackBerry’s long-term commitment and multi-tiered strategy to engage young women at every step of their education from school to college, and as they rise through their careers. As more than 55% of BlackBerry customers are women, BlackBerry aims to champion this generation of female leaders as they strive to achieve their ambitions in this highly-competitive industry.

For those interested application is now open and will close on June 26, 2013. For more information about the program, eligibility requirements, and how to apply, please visit www.blackberry.com/scholars.  Please spread the word on Twitter by using #BBScholars.

The Importance Of Branding

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Having a strong brand is important. It doblog_angle-brand-imageesn’t matter if you are an author working from home or a huge marketing consultancy with hundreds of staff. How you present yourself to your customers, clients, and staff, as well as online is always important.

Brand Guidelines

You’ll probably find that when you started your business you already had an idea of how you were going to conduct yourself and show off your company.

You should take these ideas and write them down. These are your brand guidelines. They could be as simple as using your logo on all correspondence or you could go into more detail with the fonts you use, the way you speak and the clothes you and your staff wear.

Ask Your Customers

If you are unsure as to what you brand is, or should be, then ask your customers as they’ll be able to give you a less-biased opinion than your friends and family. Market research like this gives you a good idea of where you stand in the market, how your customers perceive you and if your actions are portraying the right image.

Instantly Recognisable

The great thing about building a brand is that you can create something that is instantly recognisable, even when your brand name isn’t visible. For example, if people know your logo well, they’re likely to think of you when an envelope arrives on their desk in those colours.

Expectations

Your branding can also tell customers what to expect. Elegant, swirling fonts and colours such as gold and deep red just scream opulence. You must live up to these expectations though, if your branding doesn’t match what you sell or the service you offer then you’ll either end up disappointing your customers or attracting the wrong ones.

Cut Through The Noise

If you do something controversial, different or exciting with your brand then you are likely to get noticed. This might be an amazing advertising campaign, an unlikely mascot (meerkats, anyone?) or a very honest approach to the business and customers.

This is how people will remember you and there’s always the likelihood that something you do might go viral and sky rocket the brand to fame.

Brand Advocates

If you can get a high profile figure on board with your brand then people are going to start to take note. It’s no good asking a footballer to be the face of your new chocolate bar as the two don’t really fit together. However, a celeb chef known for her love of chocolate would work brilliantly.

Stick To It

Once you have some your branding sorted, stick to it. People will come to recognise the brand and that’s only useful if you continue to use it. This might be on promotional material, uniforms, stationary, or on your website.

There might come a time when you want to rebrand but this should be done carefully and only when your current brand is so out-of-date that it no longer represents you and your company.

Take a look at this article on Richard Schaeffer Liquid Holdings to give you an idea of how to brand yourself as an individual.