Here are this month’s best blog entries about investing and finances. If you have something better, let me know in the comments.

The Simple Dollar is intriguing as always and writes How Consumer Culture Undermines Children’s Well Being. Nice stuff.

The Silicon Valley Blogger thinks it’s time to shift to frugal living. What’s your take?

The super cool blogger Punny Money thinks that budgets are overrated. Your drawings rock, mate.

My Dollar Plan gives 10 ways to eat out for less. 11th tip from me is to eat less outside.

Are you a college graduate? Money Smart Life has something to tell you.

A good tip from Money Crashers: when the market is down, invest in boring companies. Microsoft is the most boring one I can think of.

Now that’s a problem many of us have. How to save money while eating at work?. The DINKs have a solution.

Stephanie has a positive look on the recession. Do you have some positives to share?

Generation X Finance suggests that maybe higher food prices are good for us as a society. They are maybe good for your personal health as well (eat less, stay fit).

The Clever Dude has a sweet idea – grow your own mini garden. I can add: buy agricultural land and grow a bigger garden. It pays well if you have free time to take care for it.

Listen to Clint: Going green keeps more green in your pocket. True.

If you wonder what kind of investments work well for you and suit your character the following quiz should clarify the doubts you have. You may have some fun with the quiz but take the results seriously – many people take wrong investment decisions (as shown in the poll results as well) because they don’t follow the investment style which is most appropriate for them.

I was researching for new good managed accounts since Galleon, FXCM and FxStreet aren’t doing great. There are several good ones which will be reviewed soon, but their minimums are between $25,000 and $50,000.

I wanted to find something with lower minimum and ended up at Pip City. Let me save you from further stories – this “company” is scam. They are completely anonymous and offer 25% fixed monthly ROI with $10,000 minimum. The “managed account” program is for six months.

How I know this is scam:

1. They offer fixed (and pretty high) ROI. This is simply a joke in a managed forex account. No forex trader can guarantee you fixed ROI unless he’s backing the deal with his own funds (unlikely)
2. It’s not really a managed account. If you contact them and ask which broker to open an account with they give you bank wire details!!!
3. They have filled ForexBastards.com with fake reviews how great the service is. What a joke
4. Last year the same bloody scammer offered even more ridiculous “investment” at a HYIP forum with just $1,000 minimum and ROI 25-50% for 18 per month.

In short – stay away from this crap please. Don’t believe several good reviews on the net, everyone can create an account at Forexbastads and write a review.

Your main target as an investor is to make your money work for you, rather than you working for money. Most of us usually think about owning assets which can bring entirely passive income for years. And that’s fine.

Photo by KUNTA.TOKYO at Flickr

But buying ready asset which brings passive income is not always the best option for you. Here are some reasons for that:

• Such assets have high price. Said in another way, it means the assets which can be bought easily rare bring good yields. The easiest thing you can do is to have a bank deposit, but it will bring you just 3%-4% per year.
• There is a high risk. If you find ready for producing income asset at a good price (i.e. bringing higher ROI), it will go together with a high risk. For example a managed forex account can bring you 100% or more per year, but you can also lose 50% or more of your money.
• Everyone can have same assets. Well, this is not entirely true, because some of the assets are available only after careful research. But in general, everyone can invest in stocks, managed trading accounts or hedge funds. This means that the mentality of the masses can easily change the value of the assets. See what happens with the stock market or the mutual funds at times of mass psychosis.

Create Assets Yourself

If only money is the barrier to most ready assets, how can you expect them to perform great? In today’s world the total amount of money is always higher than the real resources which makes the prices of financial assets fluctuate depending on psychology and mass-media factors.

On the other hand, assets which require more than just money have higher core value. This is the case with growing a business. It requires creativity, ideas, hard work, discipline, concept, people, technologies, relationships, properties and intellectual rights. A business unit has a real value, not only perceived one like many financial assets.

If you own a business the global market crashes are much less painful for you than if you owned stock shares. Even when the global recession hits you, your losses are usually not that bad.

Growing a business or creating an intellectual property is not exactly a passive investment

Unfortunately you can’t just put some money somewhere and watch a business grow (Or you can by angel investing but then the business will not be yours). Your business needs your ideas, capital and creativity to get started. Even if you have all the money growing your business needs at the beginning, you’ll still need to work hard your mind in order to create a valuable and successful company.

But growing a business can still be seen as a passive investment in general. If you only invest your time and hard work at the beginning and create a system which can work and grow without you, you will have an asset bringing you a passive income.

Creating an intellectual property is another and simpler way to grow an asset. Let’s say you write a book or a software program. You have to invest a lot of ideas, time and efforts into creating the product. During this time you will not be an investor, you will be a worker. Even if you outsource the writing or the programming, you will still need to work in the beginning at the idea project and later to keep an eye on what’s going on. Once created however such a property can bring a residual passive income for long time. Then it turns into an asset, so the whole process again can be seen as investing – you invest time, money and work at the beginning as opposed to investing just money.

You may decide just to buy an intellectual asset – for example resell rights for a book. But buying resell rights is easy, everyone with money can do it – so the ROI of such a venture is much lower.

It’s really as simple as that – the cheaper and easier to obtain an asset it, the lower profits it returns. Expect the higher ROI from assets which require the most from you – and that “most” is not always money.

Growing your own unique assets is the best long term strategy for financial success. I believe it’s the only way to survive unpredictable market movements so I’ll cover this topic more and more in the future.

I should probably call it super successful. This is a Livesctock futures & options trading account with amazing performance started on small test account.

The program is called MAP and is offered by Roger Show at Livestock CTA, LLC.

The trading is done on USA markets with futures on 25.00% Systematic and 75.00% Discretionary methodology.

Minimum account size: $25,000

Average yearly ROI: 95.84%

The average ROI is very very impressive but there is one important thing to consider. Judging by their charts they have just started accepting deposits and the past performance is based on account of $1,000 . This is at least what I can understand. Even this trading has some large drawdowns of 34% so consider this a really risky investment.

Unfortunately the minimum investment is quite large, but because of the great ROI I thought this managed futures account worths sharing and keeping an eye on.

You can find all the contact information for this opportunity and the Livestock CTA site.

Would you mind owning 50% in a billion dollar company?

“Then you need at least a half billion”.

No.

Most private investors don’t buy 50% of a billion dollar companies but many of them own such.

Photo by AussieGold at Flickr

The early bird gets the worm

The key to successful venture investing is to enter it as early as possible. For sure startup investing has made many people millionaires – for example Guy Kawasaki.

The startups are happy to get every dollar and often are ready to sign contracts which give you 50% or more ownership in the startup company. Sometimes you will even be the boss, it all depends on the size of your investment.

How Much Does It Require?

Startup investing is not a low entry business. Unless you do it thru a mutual fund, but then it’s not real startup investing.

There is no exact minimum of course, but since the last years I am looking for such opportunities I know some numbers. Typically a startup company will be looking for 60% – 100% funding. This means your investment will vary depending on the business niche, but typically the lowest possibilities are $10,000 – $20,000. For web businesses you may sometimes go with $5,000 or even less.

Of course, most startups are looking for $100k and more, up to several millions.

Finding and Choosing Startups

In general there are a lot more startups looking for funding than free money to fund them. So it’s not hard to find a startup, the hard part is to find the right one. However here are few ideas where to search:

• Friends and relatives. You probably have enterprising friends or relatives who are looking for some funding. If you trust them and their skills, this is a great option for you.
• Startup networks. Check out for example my pick about GoBigNetwork. At such places you can get in touch with many startups.
• Angel Investor Syndicates. Many Angel investors join such syndicates to fund startups easier. One place to join such syndicates is Angel Capital Association
• Your Funding Company. If you have a lot of cash, create your own funding company just like Guy Kawasaki or Paul Graham and have the startups contact you.

Choosing the right startup is much harder, that’s why many investors consider startup investing one of the riskiest activities (and I agree with them). Many startups will simply fail and thus most or even all of your money will disappear.

When picking a startup, watch out for:

• Their business plan. It must be well done and promising. If needed, ask an expert for help
• The business niche. The best you can do is to invest in a startup in growing business niche. Typically IT, biotechnologies, energetics are always hot. Avoid funding startups in dying businesses
• Location. Unless you invest in web based business, location plays a big role.
• Unique Selling Proposition/Point Of Difference. If you want to make high profits the business you are investing in must have a good USP.
• People’s credentials. What kind of person is behind the startup? Has he or she any successes so far. Does he or she look appropriate for the business?

There are tons of things to consider when investing in startup. It’s not easy at all. But startup investing is one of the few chance for to radically change your financial life with just few thousands bucks.

It has been more than six month since this blog started and I think it’s time to know more about you. Why are you reading this blog, what do you want to find? We all struggle to achieve better financial situation, but there are different difficulties for every one. Now I want to know yours.

Please choose from this poll up to 3 major problems that make your way to financial success harder. And know that I am asking this for a reason – I have something in mind and will share it with you very soon.

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As promised in the article The Basics of Domain investing I am going ahead with this topic. It created some buzz which makes me think a lot of people are interested in non-conventional investing. (Which is great, because this is what I like to do and write about most).

Photo by streetart at Flickr

“The Basics” only covered how basically the domainers play the domain names game. Now it’s time to go into more details how you can do like them.

So if you find good domains or sites (how? in another article of course)

Parking Domains

The domain parking is useful for domains with type-in traffic. If your domain does not have type-in traffic, you’d better not park it. You have seen parked domains – you type in some domain name in your browser and instead of a real site you end up on a page with links and “search results”.

Parking is a lazy method to make money because it virtually takes no effort. You can use the services of a parking company or park the domain yourself if your hosting provider allows that.

Parking is an easy method, it’s not the best one. If you want better profits, try other method.

Flipping Domains

Domains are just an asset like any other and flipping them is like flipping stocks. You buy domains with good potential and try to sell them at a better price.

You can find domains for flipping at online markets like Sedo or Sitepoint, but the key to successful flipping is to find under-priced domains which can rarely happen there.

One strategy to find under-priced domains for flipping is to look at less popular domain trading markets, buy them and try to sell on more popular like the two said above.

Another (better) one is to flip registration fee domains – i.e. brainstorm for good domains which are free, register them and then sell.

Flipping can be a lot more advanced if you do it on working websites, not just on domains names. Finding under-priced sites is much easier though it’s riskier. You can find such sites in directories, by doing web search… it’s a large topic which, you guessed, will be covered in a different post.

Developing Domains

It’s actually developing websites for the domains you own. You need an idea and if you want it to be really investing, you need some money to purchase the development rather than doing it yourself.

A developed website can be kept as an asset for residual income or can be sold (flipped) to someone who is willing to pay a good price.

I won’t really talk about “how to make money online” as there are millions of guides about that. Just know that most these guides are crap and in most cases you’ll pay for nothing, so stay away from buying guides who promise to tell you how to make easy money online.

Developing websites is a like developing a business, in fact it is business itself. So don’t do it if you don’t have an USP/POD or at least a competitive idea.

Just a very short reference: your domains can be developed as content websites, online services, communities, blogs, e-shops etc. You can make money from ad revenue, access selling, selling other stuff, joint ventures, affiliate programs and more.

Spamming

Spamming means to use black-hat SEO to bring traffic to your parked or developed domain. Usually it’s done for advertising or affiliate revenue. I don’t recommend you do spamming not only because it’s illegal and unethical but also because it’s not a good business model. Therefore I am not going to write much about it.

This pick will be slightly different than most shark investment picks – it’s not as aggressive as usual. Irish Forestry Funds (IFS) is a company offering forestry and property investment funds. This pick is not as aggressive as the typical shark investment picks. The ROI is not very attractive – the different funds range between 8.5% and 14.5% per year.

There are several of reasons to pick IFS for the blog this week. First, there are only few reputable forestry investment funds and IFS is known to be one of them, already more than 10 years in business. Second, I believe forestry investment will become more and more lucrative in the future, so it’s a good idea to plan putting money in such funds from now. And third reason is that we should all care about the Earth and do some green investing.

This April IFS is launching The 5th Forestry Growth Plan so I thought it’s the right time to draw your attention to it. I don’t see the projected rate of return announced so it will probably go along the line of the recent funds.

This company will not make you rich for sure so if you are short in funds, you may prefer to check my other investment picks.

If you know about more aggressive forestry investment funds I’ll be more than happy to hear you.