Check Google AdWords tool for “home business” it will return 3,350,000 visitors per month. Other popular search words also give similar figures. Just imagine if only.01% of total searchers joins internet home based business arena how huge the number turns out. There are other search words too! So can we say that a huge number of people entering Internet home based business arena through out the world every month? Yes, there is no doubt about it.But is there any tool to say us how many of them quite after joining home based business? I don’t think so. Sale of expired domains may give a partial picture. Actually most quit long before their domain becomes saleable.I was checking with my neighborhood where I grew up. I found not a single person who makes a living out of Internet marketing. Whenever I raised the issue with someone, they say, come on man, you know I know everybody knows those all are scam. I checked how they knew that all are scam! I discovered many of them were in it for some time but quit soon enough. I tried to figure out what might be the reasons for their quitting.Obviously there might be many different reasons for quitting an Internet Home based business. It might vary person to person. Even then we can gather some common causes behind the quitting.The first to go are those, lured by lucrative sales mail or newsletter or banner ads while browsing. Seeing the quick buck offer they failed to resist the temptation and invest without thinking. They quit soon enough after realizing the “quick buck” does not comes as quickly and easily as expected.Lack of self judgment is another factor quitting. Internet home based business is not for all kind of personality. There are some cannot stand without socialization, whether at work or at leisure, are not fit for it. Internet home based business demands hour after hour behind computer. They quit easily not coping with the habit. There are others who cannot work on their own. They need someone dictate them, tell them what to do. They also quit soon enough not able to plan what to do and how to progress. Nature of Internet home business is slow progress. Those who are restless cannot coup with the slowness of the progress quit frustrated. In fact reasons of quitting over personality issues are endless.Every business needs investment. It could be money; it could be time or it could be both. If the budget of time or money is not properly planned, the result is not becomes an internet marketing success but quitting. The quitting could be over lack of budget after initial investment. It could be for over spending initially and not seeing return soon after or it could be over not managing enough time to succeed.Certain skill is needed to be successful in internet home business. Not that if do not have those skills initially you will not be able to do internet marketing. These skills could be developed gradually. But not many have the time, patients or determination to develop these skills. Result is quitting.Success in Internet home business demands discipline, being organized and consistence. It is all about making an action plan of progress and taking actions repeatedly day after day. It is all about progressing gradually and consistently. Obvious result is quitting if fail to understand or follow this process.Lastly, whatever the reason is, if one is not strongly motivated to internet home based business, he is bound to quit. This factor stands between success and failure to an internet home business. A person not strongly motivated to home based business cannot push ahead all the hurdles stand between him and success.Certain skill is needed to be successful in internet home business. Not that if do not have those skills initially you will not be able to do internet marketing. These skills could be developed gradually. But not many have the time, patients or determination to develop these skills. Result is quitting.Success in Internet home business demands discipline, being organized and consistence. It is all about making an action plan of progress and taking actions repeatedly day after day. It is all about progressing gradually and consistently. Obvious result is quitting if fail to understand or follow this process.Lastly, whatever the reason is, if one is not strongly motivated to internet home based business, he is bound to quit. This factor stands between success and failure to an internet home business. A person not strongly motivated to home based business cannot push ahead all the hurdles stand between him and success.
Why Protecting Wealth Must Be an Investor’s No 1 Priority In This “New Age of Investment Bubbles”
What worked prior to 1995 for investors, no longer works in our “New Age of Investment Bubbles” we as investors find ourselves in these days.
If you as an investor manage your own employer-sponsored 401(k), Roth/401(k), 403(b), or other retirement account, or leverage a Buy-and-Hold strategy to build long-term wealth, or choose to hire a financial advisor/professional to manage your money… your investments are not protected from the massive loss of wealth that will occur when the next and all future bubbles bursts.
In this article, I’ll focus on:
Why a Buy-and-Hold strategy is dead in today’s “New Age” of investing.
Why protecting your wealth must be your #1 priority.
The “New Age of Investment Bubbles”
1995 ushered in a whole new era of investing that the vast majority of today’s investors have yet to recognize and adapt to. Investors have been mislead into believing that what worked in the years prior to 1995, is still relevant in this “New Age” of short-term irrational speculation, or gambling, or chasing what’s “hot.”
This “New Age” is built on investment bubbles that burst wiping out trillions of dollars of investor wealth and making it impossible for investors to ever realize their lifetime wealth potential.
If you’re not familiar with the S&P 500 index, the most widely held and measured stock index over time, I recommend you check out the link below to get a quick visual representation and historical perspective. I’m confident you too will agree that 1995 was a year something dramatically changed and altered the landscape of investing.
Please don’t be mislead or fooled by a financial advisor, your parents, or friends that what has worked in the past, will work in this “New Age of Investment Bubbles.” It certainly didn’t stop the massive loss of investor wealth during the Tech and Housing bubbles when those bubbles burst, and there’s no reason to think this “New Age” is going to change anytime soon as it has enriched and built massive amounts of wealth for Wall Street, investment banks, the financial services industry and all those working in them… just not for we the “average investor.”
Why Buy-&-Hold Is DEAD!
Buy-and-Hold is… no was… a great long-term strategy prior to 1995 when markets were rational, as it was easy to manage, it removed all emotions from investing, and had a proven track record of success over many decades. This strategy however, is no longer relevant or prudent in today’s “New Age” and a little math and the S&P 500 are all that are needed to prove why Buy-and-Hold is dead!
As a Buy-and-Hold investor, you’re taught that to build long-term wealth you only need to stay invested in the markets 100% of the time so you capture all the upside potential during extended Bull Markets, while weathering the downside of Bear Markets. Let’s see how this strategy has worked in this “New Age.”
If you started with $100,000 invested in the S&P 500 at the beginning of the Tech Bubble on January 1, 1995 and stayed invested 100% of the time, your investment would have gained 115% during its Bull Market and weathered a loss of 50.8% during its Bear Market. At the end of the Tech Bubble, your initial $ 100,000 investment would have grown to $105,780, nothing to write home about after 7 years.
The Housing Bubble immediately followed and its Bull Market gained 105%, or just barely enough to recover the 50.8% loss. When the Housing Bubble burst however, the loss was 56.8% and thus your initial $ 100,000 investment as a Buy-and-Hold investor, would now be worth $ 93,679 after 14 years for an annual rate of return of -0.46%.
This is the exact reason why so many Baby-boomers are having to consider delaying retirement, supplementing their retirement income with a second job, or even worse, taking greater risk with their investments in a futile attempt to earn greater return in this “New Age.”
Consider the Current Bubble we’re in. As of February 28, 2014, the S&P 500 had gained 175% during our current Bull Market, increasing the value of your $ 93,679, to $ 257,617 for an annual rate of return of 5.06% since 1995. But don’t forget, all bubbles burst and today’s Current Bubble is no exception. Assuming our Current Bubble will follow the trend of the Tech and Housing Bubbles, it’s not hard to fathom a 50% loss. Based on such a loss, your initial $ 100,000 investment will be worth $ 128,808 after approximately 21 years, and that $28,808 gain in wealth would equate to an annual rate of return of 1.21% in this “New Age of Investment Bubbles.”
No investor will ever build long-term wealth at that rate of return!
RIP Buy-and Hold… or till we meet again!
What’s An Investor To Do In This “New Age” To Build Wealth?
Investors must recognize the biggest challenge and most important factor to building long-term wealth in this “New Age,” is in how to protect the value of their investments from the massive loss of wealth when bubbles burst. Protecting wealth must be an investor’s #1 priority if they ever want to build long-term wealth.
Protecting wealth today requires a unique approach that minimizes these massive and devastating losses of wealth when bubbles burst. To do such, investors must simply learn when it’s prudent to get out of the market when a major market meltdown is occurring by moving their investment(s) to the safety of cash or a cash-equivalent position. This is not difficult to achieve but it cannot be accomplished with any degree of success by guessing when to get out of the market, counting on your emotions to tell you when you’ve lost enough money and it’s time to get out, or by listening to friends and/or co-workers.
The only way an investor can successfully protect their wealth in today’s “New Age of Investment Bubbles” is by integrating a simple, yet highly disciplined strategy that leverages pre-determined entry and exit triggers or indicators.
Pre-determined entry and exit triggers work like this. Once a bubble burst, a pre-determined exit trigger would tell an investor shortly after the meltdown has begun to sell their investment(s) and move their money to cash or a cash equivalent investment, and once the meltdown is over and the markets have begun to recover, a pre-determined entry trigger would tell the investor it’s safe and prudent to buy back into their investments so they capture the upside potential of the new Bull Market so they can build wealth.
Academic studies prove a strategy of this type removes the guesswork, emotions, and noise for investors in trying to time the markets, reduces overall portfolio risk and volatility, protects wealth from the massive market meltdowns when bubbles burst, and ultimately, provides the added benefit of improved annual rates of return.
How does a strategy using pre-determined triggers compare against a Buy-and-Hold investor in today’s “New Age?”
Let’s assume a worst case scenario that after a bubble burst, a pre-determined exit trigger gets an investor out of the markets after a loss of 25%, and gets an investor back in after the markets have gone back up at least 25%. In essence, our entry trigger lags a market recovery and misses out on the first 25% of gains during a Bull Market, but our exit trigger minimizes the overall market losses when a bubble burst or during Bear Markets.
After the Tech Bubble, an investor integrating a pre-determined trigger strategy would have seen their wealth grow to $ 142,500 versus the $ 105,780 for the Buy-and-Hold investor. After the Housing Bubble, the investor using triggers saw their wealth grow to $ 192,375 versus $ 93, 679 for the Buy-and-Hold investor, and after the Current Bubble bursts, $ 360,702 versus $ 128,808. The $360,702 amount of wealth for the investor using triggers would have realized an annual rate of return of 6.30%, versus 1.21% for a Buy-and-Hold investor.
To see the detailed comparison of a Buy-and-Hold investor versus an investor using pre-determined triggers, please check out the link below.
What’s important for investors to understand in the examples above are not the absolute numbers, but the power of using pre-determined triggers with their investments to build and protect wealth in this “New Age of Investment Bubbles.”
A Guide on Successful Product Creation and Internet Marketing
Product creation in Internet marketing is getting stiffer and stiffer nowadays owing to tough competition between Internet-based businesses. Putting up a new product requires plenty of brainpower and finances along with an ability to take risk. With that, even if you have the product well-set already, you have to position it strategically in the Internet landscape for others to notice. You should get the interest of Web users and turn them to actual customers. Aside from the usual physical products, many different products that thrive well on Internet marketing include E-books, membership sites, and video lectures.
The long and difficult process of product creation begins with ideas. They are easy to get – compared to the effort that comes with analyzing the market for that idea. Before the idea turns to a product, businesses often spend money, even amounting to millions of dollars, to ensure the success of the new product that emerges from an idea. Businesses undertake many types of market research and surveys before releasing their products to the public. Now, you may think that because your business is small, you can’t afford research or you don’t have to do research; you can and you should. The Internet allows you to disseminate materials needed for your market study to many people at once without your having to spend a cent.
It is a common maxim in business: Look at your destination first before mapping out your journey. So what are the goals you intend to accomplish with your product creation ventures? The everyday travails of your business may make you forget the end in sight. On the other hand, prepare to entertain new developments that come to your mind in your product creation. Your conception of a product may have started this way, but a few tweaks here and there along with some market research results and it ends up another way. Take it as the result of a creative process, not as a failure to reach your goal. After all, your product creation activities are intertwined with a long-term goal that you should strive to sustain at your utmost: profit generation. So if your less profitable initial idea evolves to a more profitable product, be thankful!
With your product made up already, start doing some aggressive Internet marketing. A product purchase typically comes after more than five times a customer is exposed to an informative call-to-buy message. Thus it is important to get the contact details, like the e-mail address, of potential customers who are on the brink of a sale. Use the results of your market research to determine the demographics to which you should concentrate your marketing efforts.
With consistent product creation, you can make an inventory of your products that you can market in due time. Just keep making products – the moment you succeed in making and marketing a product, customers are surely wanting more from you, so give it to them. Keep them on your side through constant product creation.