Do you have kids? Do you have plans for your kids to go to college one day? Have you looked at how much college is going to cost you for just one kid? College is a big investment, but it is a good one. If you begin planning for this huge expense when your kids are young, you won't take much of a hit when the day comes that your teen packs his or her bags and heads off to start a new life at school. This blog will provide you with several ideas and tips that can help you find ways to plan for your kids' college tuition.
When trying to decide what to pour into your mutual fund, you will need to be cautious with bubble sectors such as the tech sector. But these types of sectors can still generate high returns if you have good timing. There are a few factors you will need to consider before adding tech to your mutual fund.
The Technology Sector Can Have High Minimum Investments
Investing in the tech sector can be very expensive, with minimum investments often at $100,000. Therefore, you will want to invest in this sector only if you have enough capital to work with to also keep your portfolio diversified.
There Has Already Been A Terrible Tech Bubble
One of the common concerns about the tech industry is the bubble of the 1990s. However, the current tech sector does not look like the bubble that caused the DotCom crash. Today, if the tech sector does crash, mutual funds will only be hurt mildly, because only a small portion of the capital is appropriated to venture capital.
The early stage venture capitalists and angel investors may still make a profit, because companies that are forced to take write-downs will still generate a profit. The late-stage venture capitalists will be the ones that will be the most likely to be hurt.
Ways You Can Identify a Tech Bubble
If you are concerned about whether the technology sector is turning into a bubble, look for a very rapid price growth and high valuation. Also, if there is very high investor demand, even the newest tech companies will be trying to go public to take advantage of the very high investor demand.
Considering the Fundamentals
Tech bubbles are usually driven by considerable and unrealistic hype. A new innovation generates excitement and a surge of investments. Despite optimistic predictions, the fundamentals for the companies will seem poor. Fundamentals refer to the valuation of a company. The fundamentals include assets, liabilities, revenue, earnings and growth. An analysis of these factors is the key to determining if the technology sector is currently worth adding to a mutual fund.
Even if there is a bubble, there is no guarantee that it will burst. Sometimes, the bubble simply deflates because investors lose interest in these investments and the sector is gradually reduced to a normal level. If you are still unsure about whether you would like to invest in the tech sector, meet with a high yield investment adviser specialized in high risk investments and the tech sector.Share
30 October 2015