Original Post ” Buy Low, Sell High? Easy if you know how”                                           By Mitch Tuchman

Markets are interesting beasts. In a sense, they are purest form of capitalism, a space where all that matters is transactions.

According to investment researchers, the sheer mass of buying and selling going on in our capital markets means that prices reflect, all the time, the actual value of the underlying companies.

People take issue with that idea, and I understand why. Stocks sometimes are bid way down or way up, depending on the emotions of shareholders. That’s a powerful force.

It’s also an utterly unpredictable one. There’s no reason a stock you bought has to go up or a stock you hold can’t continue to go down. You might disagree with the direction of your holdings, but the fact remains that prices are set by others.

Priced in the moment

And that, in the simplest, non-mathematical terms, is what Modern Portfolio Theory is all about. Prices are accurate because there is no alternative universe in which the valuation of a company is different from the minute-to-minute tick of its stock price.

You can be given stock, perhaps, as compensation, or earn it through a company program. You might inherit it free of taxes. You could, potentially, trade stock in one firm for shares in another, as companies sometimes do in order to merge.

But if you have to buy or sell in an exchange, the price is the price at the moment you decide to get in or out, end of story. Whatever happens next won’t change the price you paid, and that price was in fact the “value” of the company at that moment in time.

So how to do what all investors want to do, which is to buy low and sell high? It’s disarmingly easy.

Automate it!

First, own a portfolio of investments, one which includes stocks, bonds, real estate, commodities and foreign equities and debt.

Next, make sure the portfolio accurately reflects your ability to withstand the ups and downs of the markets. You don’t want to be scared out of an investment for no reason.

Finally, let the market does it’s magic. As some assets rise in value, you sell off a portion of them to buy those that have declined.

You can keep track by measuring the percentages: If you expect to be 60% stocks and 40% bonds, but the balance right now is more like 65/35, you sell the extra in stocks and buy bonds till you’re back in a 60/40 balance.

That’s selling high and buying low, automatically, and it’s the path to a better, more reliable long-term return.

SOURCE: Forbes

By Stephanie Powers | November 20, 2009 AAA |

The world carefully monitors the price of gold because of its association with banking and monetary systems around the world. Aside from using gold as money, humans have fashioned it into decorations since at least 4000 B.C. But gold has many unique properties that make it useful for other applications. With spot gold prices currently over $1100, let’s take a look at some uses of this precious metal. (For info on gold investing, check out Getting Into The Gold Market and 8 Reasons To Own Gold.)

1. Pharmaceuticals
Credited with curing or warding off everything from smallpox to measles, for centuries, the Chinese have used gold as a vaccine.
Gold was a common treatment for rheumatoid arthritis from the late 1920s until the 1990s. According to the JohnsHopkinsArthritisCenter, gold flakes were injected into muscles, into the veins and even given orally. Though gold could sometimes be an effective treatment, it is unclear exactly how it improves the patient’s condition. New treatments with fewer side effects are now preferred.

One of the most exciting uses of gold in medicine is precision delivery of medication to fight cancer. Microscopic gold covered “medicine bullets” are fired at targeted cells then activated to release their load.

2. Implants
Most people associate gold body parts with gold fillings or caps on teeth. It can also be used in medical implants from stents to pace makers because it is resistant to bacteria and deterioration.

3. Health Supplement
The Japanese originated the tradition of ingesting thin films of gold in beverages and food as a sort of “vitamin”. In India and Egypt, it is taken as a powder or a tablet.

4. Beauty Regime
Chinese beauty product manufacturer Umo, offers massage cream, facials, and other products containing gold. Check out their website for the entire line: http://www.umosen.com/en/products.html.

5. Conductor / Connector
Gold’s ability to conduct electricity and facilitate connectivity has been known for decades. Since the 1930s it has been used in telecommunications equipment from fuses to switches. Just about anything electronic contains gold circuits. The microchips in cell computers, cell phones, even that little locator chip embedded under your pet’s skin contains gold. It is common to find 24 ct gold plated electrical adapters and plugs for audio and video cables.

6. Imaging
Photos printed in gold produce high quality lasting images. New technology uses gold ink in ink jet printing. High quality compact disks coated in gold resist scratches and last longer.

7. Chemical Cleansers
Used as a chemical catalyst, tiny gold particles are used in industrial settings to provide a cleaning mechanism for chemical reactions. It is important for pollution control, energy production and food production.

8. Sun Block
Astronauts wear gold coated visors in space, not as a fashion statement, but to protect their eyes from dangerous sun rays. Gold covers many parts of space crafts and modules to deflect harmful radiation.
The windows of entire buildings, like the RoyalBankPlaza building in Toronto, are coated in gold to reflect light and decrease utility bills.

9. Industrial
The ability to conduct heat, add strength, and reflect light, makes gold a popular industrial element. Gold is used for everything from coatings to lubricants to moldings in manufacturing.
A recent search for gold plated auction items on Ebay.com turned up 38,302 items, mostly jewelry & crafts. Also found were: musical instruments and curling irons. In addition to plating, gold can be found as a glaze, thin leaf, and liquid. In its solid form coins, jewelry and sculpture are prominent. (For more on gold, read The Midas Touch For Gold Investors and Does It Still Pay To Invest In Gold?)

SOURCE: Investopedia