What is a DCD on an FX (foreign exchange)?
What is a DCD on an FX (foreign exchange) & what does it mean?Answers: Dual Currency Deposit (DCD)
A Dual Currency Deposit provides a difficult yield than a run of the mill money market deposit and may apply for clients who have assets or regular flows within two or more currencies, and are willing to risk a potential loss of property.
What does it expect when volume drops on a stock?
How significant is it, when for a stock, volume drops drastically? Example is AAPL, which has sropped to below 1 M, when average is 50M. Does it anticipate that the stock is likely to team leader south even more? Does it mean that within is very little interest contained by the stock?Answers: It depends on what is happening on the underlying.
Example:
Volume can travel up during what is known as a "consolidation" spell, where empire are getting rid of their shares all at once, and sometimes the family who want the stock are taking advantage of it and buying it at like peas in a pod time. This will in turn disappear the stock price temporarily.
It basically mechanism the number of shares being traded is low. This can enjoy huge impact on the price of a stock. It doesn't mean it is going south, however. Stock volume can cash, perfectly crude as interest in them can varie depending on what is going on near the company.
Are any or adjectives of these large risk? FGP, PVX,FRIZX. I want VERY conservative, my finanacial advisor put me?
put me in these and I don't know how to compare their risks. Can anyone assist me?Answers: First off, I would ask you to review what you typed as FRIZX does not exist. If you would post the corrected symbol, or the full dub, I will look at that as well.
Basically, I would not consider these companies to be markedly conservative. In actuality, if you are looking for a very conservative portfolio, you should not be surrounded by stocks at all, you should be contained by bonds and money market accounts. Even if you be in stocks, you should be surrounded by mutual funds and not individual stocks, as mutual funds increase diversification and reduce risk. The entry I am concerned about beside the two oil companies you timetabled, FGP and PVX is the dividend yield. I would assume you be put in these because of the glorious yield, which can be a signal of a conservative investment. However, I am concerned roughly speaking where these dividends are coming from, especially near PVX. Basically, I looked at the Statement of Cash Flows to determine where the dividend be coming from, and the answer is a bit alarming. Below are the numbers:
Operating Cash Flow: 355 Mil
Investing Cash Flow: (563 Mil)
Dividend: (248 Mil)
Stock: 337 Mil
Borrowing: 100 Mil
Basically, when you run the numbers, PVX paid its dividend to shareholders from funds it raise from issuing stock and borrowing money. If the Investing Cash Flow was used to boost production and increase Operating Cash Flow, it would not be much of a concern, but I hold not studied the Company and do not know what the investment went to. It with the sole purpose concerns me that from 2004-2006, the dividend was at least possible partially compensated on borrowed money, or through issuing stock. That means the Company is taking on debt, or diluting shareholder merit, and not even doing it in a behaviour that will be profitable for shareholders in the long-run.
As for FGP, during 2007, the Company have Operating Cash Flow of approximately $118 million, while it paid $127 million within dividends, meaning that it have to borrow $9 million, or use $9 million in bread that it had on paw to meet the dividend requirement. This would be a concern to me as a shareholder, as it mechanism the Company should lower its dividend by at least 7.1%, to $1.85 per share, at which point its dividend would equal its operating income. Even at that point, the Company would hold to borrow money to pay for any funds expenditures for maintenance or growth. Basically, I would not consider this Company to be thoroughly conservative, as the dividend could potentially be at risk, should the Company continue to fall through to fund its dividend, in full, by operating dosh flows.
I would definitely rouse you to talk to your advisor in the order of the companies, and why he/she believes the dividends are secure, as former times financial statements speak otherwise. Even more importantly, why he/she thinks the companies are safe and sound investments, as if they continue to hold to borrow funds to meet their obligation, they will be stuck with huge interest and principal payments sometime surrounded by the future, which could severely restrict their financial flexibility.
Take this information for what it's worth, as I hold not studied the companies, and my response is based solely on a surface look of the financial statements. It might, at the smallest, give you some facts to present to your advisor. Basically, contained by saying that you want remarkably conservative allocation, I would encourage you to push your advisor to provide you a rock-solid use as to why these companies are, otherwise, you should be primarily invested in money flea market accounts, where your principal's downside risk is protected. Of course, that vehicle you have to sacrafice the 8-12% dividends that you are currently delivery for 2-4% interest payments.
Feel free to edit your sound out with the proper information for the FRIZX symbol that you scheduled, and I will try to find it, as it did not show up in my previous search.
Just some thoughts, I hope they helped.
Best of luck!
Brendan Prewitt
Additional Details:
I still own the feeling that your advisor is not truly aware of your risk tolerance, which sounds extremely low. If you enjoy made this very clear to him/her, later it may be time to consider finding a new advisor, as he/she does not seem to be to be listening to your requests. FRIAX is strictly conservative, however, given that you want nearly total preservation of your capital, this fund does not accomplish what you want. It have a 6% yield, and an average annual return of something like 13%, however, it invests in equity, along near below investment grade debt. The fund is allowed to invest up to 100% of the portfolio into below investment level, junk debt, which is not what you want as a protected investment. If you do invest in bond funds, you will want funds that solely hold investment grade, large quality debt, which is BBB to AAA rate debt. However, given the current price levels of bonds, in that is a fairly high-ranking risk of loss of capital (at lowest some), when the market improve and bond prices move lower. Given what you've said, I really think you should verbalize to your advisor, and let him/her know that you are not comfortable beside the risk of loss, and that you would prefer very out of harm`s way investments with little risk to your principal, as your current allocation is anything but that. FRIAX is composed of in the order of 39% stock, and 45% debt (the remainder in currency and other investments). A truly conservative allocation would be only within bonds and money market funds, near preference given to money marketplace funds. I would definitely instil you to pressure your advisor to explain how your portfolio meets your requirements, as from what I infer, it does not fully do so. You have to remember that your advisor will be compensated whether he/she makes or loses your money, so you own to be aggressive and make him/her watchfulness about your investments as much as you do, which usually involves human being a bit overbearing and asking a lot of question as to why the investments you are in are correct for you. Feel free to e-mail me at nycigllc(a)yahoo.com if you own any other questions about this. I hope this helps some.
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cheers