Archive for the ‘Forex trading’ Category

Hi Everyone!

My series on “How To Make Money Run After You” will be my most lengthy series that will be published in Manila Bulletin by far, as such I believe that it deserves it’s own website. The new website is a hundred times more awesome than my already awesome business advice blog! so that I can organize and really teach all of you how to not just make money run after you but to be able to create “True Wealth”.

Go here now to check it out: http://wealthflowproject.com

For the past 3 weeks, I have been very busy creating a brand new site which contains not just my money management articles but ALL my business and investing articles including my super genius wife’s articles on career management. Once you get to the new site, you will immediately see how much effort I really put into it as all my articles are now much more organized and tasks and assignments as well.

What’s more is that I became really “obsessive-compulsive” about making sure that all my lessons are received by all and that the tasks and activities are clear and step by step. I call this the “Wealth Plan” and it is FREE for all of those who sign up on the new site. (On the right side you will see a big red arrow, can’t miss it really) Just place your name, email and phone number, then click register. Super easy!

Go here now to do that: http://wealthflowproject.com/instructions

Oh, by the way, you will also have a blast looking at all the “cartoons” I personally drew for the site! Yes, I also draw and doodle, one of my other hidden talents. Also, just to let you know, I drew all of the artwork on my iPAD and directly uploaded it into the site. Super awesome! I love technology don’t you?

So, for those of you who what to stop running after money and make “Wealth” flow instead to you,

go now to http://wealthflowproject.com  or just Click HERE Now

All the best!

Mark So, your handsome business mentor!

I want you to imagine that you are in one of my finance seminars right now. You are seated in the middle row and you are here because you want to understand how to grow your money.

As the seminar begins, and after I make everyone feel comfortable, I pause and look into the crowd and ask a simple question. “Can anyone tell me; is there a difference between Trading and Investing?”  A few hands go up and I pick one. “Sir, investing is putting your money into an asset and making it work for you”. “Good”, I say, “…and what about Trading?” “Well, sir trading is buying and selling”. “Very good, okay, how about you?” I point to another person. “Investing is long term, trading is short term”. “Fantastic! Thank you for your very concise answers, you are both correct, now let me summarize and simplify so that everyone understands: Investing and trading are both being able to place your money into assets and make it work for you, both of them are also buying and selling, the difference is, investing is buying and selling on a long term basis while trading is buying and selling on a short term basis.”

Then I joke around. “Of course many of the experienced investors in the room know that Investing is also known as ‘Buying and Praying’” Which elicits a healthy amount of laughter. And I continue “…And those of you experienced traders in the room also know that Trading is ‘Buying and Praying Faster!’” And the room gets hysterical. I continue with another question: “Okay, raise your hands, how many of you want to make money by waiting a few years (Long term) to see some returns?” About a third of the room raises their hands. “Great! Now raise your hands if you want to make your money even faster!” Almost everyone in the room, even those who said they wanted long term investments raises their hands. “Ah, greed is in the air today I see…Now let me ask you, why do you want to make money faster?” Someone shouts, “Para yumaman ng mas mabilis!” (“So that we can get richer faster”) And the room starts to laugh again as everyone has the same mindset. So I continue “Very good, I know exactly what  you mean, everyone wants to get rich as soon as possible.”

Then I ask a few more questions: “So, how long would it take for you to double your money in a long term investment?” The crowd begins to chatter and you can hear people saying certain investment types and attaching the amount of years it would take for that investment vehicle to double their money. Some say 5 years, others say 3 while others say 10 years. “And how long would it take to double your money in trading short term?” Then the crowd randomly mentions a few numbers, some say 1 month, 3 months, 1 year. “Okay guys, that’s great, now let’s just say, for long term investments, and for arguments sake, can we agree that if you pick the right vehicle and you invest at the right time, you can actually double your money in 1 year?” The investors in the room nod. “Okay then, now for the traders in the room can we agree that for short term investments, you can double your money in 1 month?” A person from the back shouts “Actually Sir, you can double your money in 1 week, especially if you time it correctly!” And I myself nod and continue “…That’s true, but let’s just say 1 month to be a bit more conservative, can we agree? Good, now let me ask you guys, if you can double your money in a long term investment in 1 year, can you also lose all of your money in 1 year?” The room unanimously agrees, Yes they say with a vengeance. “And for short term traders, if you can double your money in 1 month, can you also lose all your money in 1 day?” The room, especially the veteran traders, vigorously nods in total agreement. ‘Absolutely’ is what I hear some people say as I press on.

“Good! Now, do you still want to make money in the short term knowing that you can also lose money faster?” then suddenly the room starts to ponder and quiet down a bit, and I can see some people beginning to realize the ugly truth about trying to grow your money whether for the long term or the short term. Everyone wants to make money fast, but my question made them realize that they might not want to lose money –slow or fast.

So I look around the room and I speak to them as I am speaking to you right now.

“Well, if you ask me, I would still want to make money in the short term even if I know that I can lose money faster, because and remember this, if you lose money in a long term investment, you don’t just lose your money, you also lose something far more valuable, you lose time. Remember my example above? If your long term investment made you lose money in 1 year, you lost your money and you also lost 1 year of your life — something that you can never get back…. Now if I lost my money in the short term, say 1 month. I lost my money, but only 1 month, which means I still have 11 months in the year to decide on what to do with my life!” And the crowd laughs and smiles in unison as if they saw clearer into their future on how they might tackle how they will grow their money. They nod in simple agreement and like them, I hope that you now understand in more practical terms what the difference is between Trading and Investing.

Want more of my Premium Articles like this one? Go to my blog at http://www.markso.wordpress.com now.

Author box:

Mark So is a fervent businessman, forex trader, marketer, sales consultant, and educator.  He is the Chairman and CEO of Businessmaker Academy—a business, finance and corporate training center.  He is also the Chief Forex Trainer of Forex Club Manila. Mr. So is slated to conduct his “Forex Orientation Seminar” this August 28, 2010. If you are interested in attending this seminar, click here: http://www.forexclubmanila.com/forexorient or call 6874445 / 6873416 / 6874645 and look for Aiza King

Let’s face it, like many Asian countries, the Philippines is a US Dollar Remittance driven economy and I have been asked many times about how to deal with the rise and fall of the USD as many Filipino Dollar Earners, Overseas Filipino Workers, as well as Export and Import driven businesses earning capacity and/or profit margins largely depend on learning how to effectively deal with this issue.

So in this very special 2 part article, I will explain why the USD rises and falls, how it affects the peso and what you can do about it right now so that you can protect your money and possibly even make a nice profit for your self.

Before we begin, let me say that I have been invested in currencies since 1998, I am one of the very few in the Philippines who teaches currency trading and if I do say so myself, I am very good at it. So I hope you are excited to learn because here we go.

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A couple of years ago I gave a seminar to a group of Exporters about how they can protect themselves against the rise and fall of the Dollar. This seminar was an eye opener for all of them because the solution that I showed them was far simpler than they could ever imagine. Now you don’t have to be an exporter to know and apply this simple strategy yourself, as long as you have some dollars in your possession, this article should shed some more light on the subject and make you more intelligent in how you deal with your money.

To understand what makes the US Dollar fluctuate, let me first open your mind to what goes on outside the Philippines and talk about the fantastic world of global currencies. Then I’m going to zone in on the Peso and why and how the USD affects it and what I recommend that you do about it.

Now I’m sure that you have heard of Euros, British Pounds, Swiss Francs, the Japanese Yen, the Canadian Dollar, The Australian Dollar, The New Zealand Dollar and of course the US Dollar right? Well among these major currencies that I talked about, the US Dollar is the “heavy weight” of them all.

The US Dollar is what we call the world’s reserve currency which means that everything that is bought and sold in the global markets are all priced in US Dollars. If you are an exporter of whatever product from the Philippines selling to Japan, you do not get paid in Yen, you get paid in US Dollars. If we import rice from Thailand (which we do, in fact, we are the biggest importer of rice in the world) we do not pay in Thai Baht, we pay in US Dollars. Even if you are an overseas worker in Saudi Arabia, your salary will most likely be in US Dollars. This is why all countries for the purposes of global trading has to have an adequate supply of US Dollars in their reserves.

Now keep that in mind while I now teach you a little economics to understand why the US Dollar fluctuates.

In Economics, there is the most basic law of “supply and demand”. In simple terms, there will be Sellers (Supply) and Buyers (Demand). To explain how this law works let me talk about one of my favorite canned goods of all time: Hormel’s SPAM.

Now for example Hormel, the producer of SPAM says, “Okay starting tomorrow we will no longer produce SPAM (Supply diminishes) people like me who loves SPAM will start buying up the remaining cans right? (Demand goes up) So if supply continues to diminish because there are more buyers (demand), what will happen to the price of spam? It will go up (price fluctuates). Now, what if the next day Hormel announces: “we were just kidding, we’re not going to stop production, we’re going to triple production and just change the brand”…(Supply goes up) People like me will not be very happy and will most probably be disinterested in buying spam again (Demand diminishes), now what will happen to the price of spam? It will go down (price fluctuates again).

Now let’s go back to the US Dollar. All you have to do to understand why and how the dollar fluctuates is to simply replace the word SPAM with US Dollars, then replace Hormel with the US Federal Reserve (The US Central Bank that regulates the production of US Dollars) then read the example again.

The US Federal Reserve says, “Okay starting tomorrow we will no longer produce US Dollars (Supply diminishes) people like me who loves US Dollars will start buying up the remaining Dollars right? (Demand goes up) So if supply continues to diminish because there are more buyers (demand), what will happen to the price of US Dollars? It will go up (price fluctuates). Now, what if the next day the US Fed announces: “we were just kidding, we’re not going to stop production, we’re going to triple production”…(Supply goes up) People like me will not be very happy and will most probably be disinterested in buying US Dollars again (Demand diminishes), now what will happen to the price of USD? It will go down (price fluctuates again).

Understand it a little better now?

So the real reason why the US Dollar goes up or down is because of the mixture of buyers of US Dollars, sellers of US Dollars, Production of US Dollars, and the Allure of US Dollars.

Click here for part Two. I will explain how the USD affects the Peso, your business / income and what you can do to protect yourself.

Author box:

Mark So is a fervent businessman, forex trader and educator.  He is the Chairman and CEO of Businessmaker Academy—a business, finance and corporate training center.  He is also the Chief Forex Trainer of Forex Club Manila.  A sought after speaker for business and forex, he is scheduled to conduct his signature seminar series on Forex Trading this Feb 2, 4, 9, 11 (Tue & Thu).  To know more about these seminars, you may visit www.businessmaker-academy.com or call (632)6874645.  You may email your comments and questions to:   markso@zerocapitalclub.com

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In my article last week, I explained that the US Dollar fluctuates because of the mixture of buyers of US Dollars, sellers of US Dollars, Production of US Dollars, and the Allure of US Dollars. (If you have not yet read that article, please click here: http://wp.me/pjUVO-2a

Now if you are an individual or a business that is greatly affected by USD fluctuations (i.e. Export-Import Companies, OFW’s or Local Dollar Earners), I’m going to share exactly what I do to protect the value of my money against erratic USD fluctuations.

***Disclaimer: This article is for educational purposes only and explains what I do with my own personal funds. This does not constitute financial advice and should not be treated as such. However, I do strongly recommend that you first consult with a Professional Financial Adviser about my methods AND get more educated first before you do anything***

So let’s begin our lesson today by first explaining how the fluctuations of the USD affect the Peso. I want you to remember this first and very important rule: The relationship between the USD and the Peso is “inversely proportional” to one another, meaning when one currency goes up by a certain amount, the other currency goes down by the exact same amount, at the exact same time always.

To make this concept clearer, I want you to think of and imagine a “see-saw”. The principle behind a see-saw is that when one side goes up, the other side goes down. Now imagine the USD sitting on one side of the see-saw, and the Peso on the other side. So when the USD goes up, the Peso goes down and when the USD goes down, the Peso goes up.

For example: You see in the papers that the USD is equivalent to 45 Pesos today, if tomorrow the published rate of USD becomes 46 Pesos that means the USD went up in value by 1 Peso, or in other words, became more expensive by 1 Peso. So if I wanted to buy the USD at the new rate, I would need 1 Peso more which means that the Peso dropped in value by the exact same amount (and the exact same time) that the USD rose in value.

Let’s continue the example, now let’s say that the USD is equivalent to 45 Pesos today, and tomorrow becomes 44 Pesos, that means the USD went down in value by 1 Peso, but at the same time, the Peso also went up by the exact same value because if I wanted to buy the USD now, I would need 1 Peso less.

(If my example is giving you a nose bleed, read it a few times and you will get it eventually)

Now keeping this in mind, here’s how I protect the value of my money against USD fluctuations. In the world of finance, this is what is known as “Hedging” or “dynamically protecting your asset(s) / investments against losses”.

So let’s say I have in my bank account $1,000 right now. If the USD is currently at 45 pesos and goes down to say 43 pesos, my $1,000 would lose value right? For some people / businesses in the same position, they would simply shrug their shoulders and just go with it, but for a great number of people / business, they might start to panic and start “converting” all of it to Peso for fear of losing even more money.  (Take note:  A small rise or fall of the price of dollars can be staggering if you are dealing with hundreds of thousands of dollars.)

Here’s a typical example: You have $1,000, the price goes from P45 to P43, you panic, change all your dollars to Peso which will now mean, your holding on to P43,000 ($1,000 x P43) but the next day the price goes back up from 43 to 45, because you panicked and did not know how to properly time your exchange, you lost P2,000 (P45,000 – P43,000).  If you have $10,000, you would have lost Php20,000.  If you have $100,000, you would have lost Php200,000.

While panicking is understandable, the problem with changing your USD to Peso may make you lose even more money unnecessarily as you can see in the example above. This would be especially true if you do not know if the value will continue to go down and more importantly, if you do not know how to “properly time” your currency exchange.

So in order to avoid these losses, and panicking altogether, here’s a simple strategy that I do to “hedge” or protect myself against these fluctuations.

If I have a Dollar account with my local bank (where I keep my dollar holdings), I simply open a brand new Peso savings account with the same bank. Take note, this is separate from my existing Peso account which I use for regular expenses. The purpose of this new Peso account is for me to start “hedging” my Dollars.

Once I have this new Peso account, all I do now is to “slowly” divide my dollar holdings into these 2 accounts. Meaning if I had $1,000, the end goal is to only have $500 in my dollar account and I will convert the other $500 to peso and deposit it in the newly created peso account. When I say “slowly” I mean I change a small amount every week until I completely divide my dollars into these 2 accounts.

This is what my dollar holdings will look like when I am done:

Why you ask? Because, and remember the “see-saw” example I gave a while ago, if and when the USD goes down, one half of my funds, the one half that I kept in dollars will go down, but the other half of my funds, the one that I converted to Peso will go up by the exact same amount, at the exact same time. This simple account split that I just did, will now protect me from USD fluctuations.

Of course, this method will have costs associated with it, the cost is the conversion rate from USD to Peso at the time that I convert my money plus the cost of maintaining another bank account. However, in the long run, regardless of the fluctuations of the USD, having a “hedged” account will “lock” in the value of my money until I choose to do something more profitable with it.  And as businessmen or dollar-earners, knowing how to protect your hard-earned money is a necessary skill that you must learn.  I hope that this article helps open your minds to the world of finance and how it affects money.  That way, we will all be able to manage our money better.

Author box:

Mark So is a fervent businessman, forex trader and educator.  He is the Chairman and CEO of Businessmaker Academy—a business, finance and corporate training center.  He is also the Chief Forex Trainer of Forex Club Manila.  A sought after speaker for business and forex, he is scheduled to conduct his signature seminar series on Forex Trading this Feb 2, 4, 9, 11 (Tue & Thu).  To know more about these seminars, you may visit www.businessmaker-academy.com or call (632)6874645.  You may email your comments and questions to:   markso@zerocapitalclub.com

Aside from building businesses, another passion of mine is investing in assets. Both of them are a means to make more money if you know what you are doing, but how money is made between the two are very different.

I’m going to simplify the difference for both of them for you right now by sharing my perspective: In business, to make money you need two critical assets: Customers and Employees. While in Investments, to make money you need two different kinds of assets: Money and Experience.

Let me elaborate, the key to making money in business is that you have to concentrate on selling to your customers. Even if you have no money to begin with, even if you have no experience to begin with, as long as you can find a customer willing to buy something from you (emphasis on buying from you) then you are in business. And the more customers you have, the more business you have. If you have no customers, then you are not in business regardless of how much products / services you have to offer or how many branches you have.

Next, you can not properly maintain a business on your own, sooner or later your business will grow, you will have more customers and you will need help, and so the next critical asset in making money in business is to have very good and very loyal employees.

Now finding and maintaining really good employees is very critical to your business’ success. It is not easy but once you have assembled a great team of superstar employees, trust me, your business will be making money during good times and even bad times.

Now, let’s explore the world of Investing. Let me ask you, do you think you need customers and employees as an investor of say paper assets like stocks, mutual funds or bonds? What about real estate? Or more liquid assets such as currencies? Think about it, and you’ll realize that you don’t.

What you should know in the world of investments, is that instead of customers, you will need money and instead of employees, you will need experience. Why? because the main way to make money in investments is to “convert” your money into “something else” that will make you even more money. This is the world where the now famous line of Robert Kiyosaki comes in: “The rich do not work for money, the rich make money work for them”. But to make your money work for you, you need to find that “something else” that will make you money without you having to work for it, and to do that without being scammed or duped requires experience.

In my business classes as well as my investment classes, I ask my students if it is really businesses that they want to pursue or would they rather pursue investing because I explain to them that you do not have to be a business person to be an investor nor do you have to be an investor to be a business person. The two roads are mutually exclusive and you do have a choice to pursue one or the other (or even both).

So I’ll ask you my dear reader the same question. “To make more money right now, and given a choice, would you like to start a business, would you like to learn how to invest?, or would you like to learn both?”

To help you decide on which road to take first, let me share some more practical advice. If you love people (customers / employees), if you do not have a lot of money to spare but you have time and a willingness to make sacrifices as well as learn along the way, then I suggest that you pursue the road of business ownership. It is a tough and challenging experience but should you overcome the many hurdles and obstacles, I assure you, you will be a cleverer person because of it.

On the other hand, if you have a job that you love and that pays you well, or already a business owner and you have some money to spare. (money that you can afford to risk) I suggest you pursue the road of the investor. There are many seminars on investing out there right now, most of them free, but be careful on which seminars you attend as it may cost you more in the long run.

For me, I am both a business owner and a seasoned investor. It has taken me a little over 10 years to get to where I am, and having traveled both roads, and exploring both worlds I would like to wish upon you the same rich experience that I have and the kind of success that you deserve.

About Mark So

Mark So is the Chairman and CEO of Businessmaker Academy and Forex Club Manila.
He regularly holds seminars on Business, Finance and Investments.
P.S. Click Here To Attend Mark’s Seminar where 2 of his students made 170,000+ right after
P.P.S. Click Here To Know More About Other Seminars from Businessmaker Academy

Life’s Purpose.

I believe that everyone has a purpose in this world and I’m one of the few who has been blessed with knowing what my purpose is. In my seminars I always tell my audience that there are only three things I love in this world. The first is my wife and the relationship I have with her, the second is making money, and the third is teaching people how to make money. The first 2 are my collective inspiration for doing what I do, the third is my purpose in life – to inspire, teach, and help those who really want to help themselves.

But knowing what your purpose is does not necessarily translate to achieving it and rarely does it provide you with money and victory at the beginning. This is because life will test your resolve. Life will throw you obstacles and problems that you never thought of. You will be discouraged by people that you love. You will feel frustrated and ignored by the people that you set out to help, you feel that life is hard and are inches away from giving in and giving up.

Don’t give in, don’t give up.

Because when life seems to want you to turn around, it is actually a signal for you to keep going. When things get tough, it is the most critical sign that you are doing exactly what you are supposed to be doing.

Life’s purpose is not to make you fail, life’s purpose is to make you succeed. (Even though it does not seem that way ). Life is a great teacher, the obstacles are how it teaches you to be better. In other words”The larger the obstacle you overcome, the larger the success you become”.

That is life’s purpose. So live your life and live it well.

To your success,

Mark So