Money | WhereDoesAllMyMoneyGo.com

Iceland's Smoke Monster

Posted by Preet on Apr 19, 2010 | 0 comments

While sad, it is worth pointing out that the volcanic ash emanating from Iceland is highlighting how some people are balanced on a knife’s edge when it comes to their finances. I have read stories of how some people (who until now have been stranded a maximum of 5 days) can no longer afford to stay in hotels while stranded and have taken to sleeping in the terminals, streets, or what have you. I realize that hotels can be more expensive in Europe than here, but regardless there are some issues here. For those that have travel insurance or are covered under their credit card’s travel interruption features, they should be getting their money back. So if they...

Changes And Facebook Fan Pages

Posted by Preet on Apr 18, 2010 | 0 comments

It’s been two weeks without a Lap Of The Blogs. I’ve been busy with filming some stuff for the W Network and regular programming will resume this week. In the meantime I’m going to be making a few changes in preparation for a bit of a change to my online persona. Don’t worry, nothing drastic… 1. Facebook Fan Page for the WhereDoesAllMyMoneyGo.com I have a personal facebook page but I only accept friend requests from people I know for privacy reasons. I’m sure I also have friends on facebook who couldn’t give a rats ass about the NAV decay in leveraged ETFs. Therefore I will be removing the blog feed from my private facebook page...

iPad Review

Posted by Preet on Apr 13, 2010 | 7 comments

So the cat’s out of the bag: there is no iPhone Macro. I indeed purchased an iPad. Here is my review after having used it for the last few days. iPad Models There are six models to choose from, but the only factors of differentiation are memory size (16GB, 32GB, 64GB) and whether or not it has WiFi or WiFi + 3G. 3G just refers to the ability to connect to the internet when you are not in the range of a wireless network. Here are the prices in the US: It should also be pointed out that if you want to take advantage of 3G services, you have to subscribe to a plan. Currently the only plans available are $14.99/month for 250MB of data or $29.99/month for unlimited...

Mentally Spending Your Next Raise Before You Actually Get It

Posted by Preet on Apr 4, 2010 | 2 comments

One thing I’ve noticed with some people is that they get progressively more stressed about money the older they are. That should come as no surprise. But it’s also no surprise that people tend to earn more and more money as they get older too. So shouldn’t things get less stressful? One (of the many reasons) for this phenomenon is the tendency for people to mentally spend future increases in income ahead of time, which is similar to how people will tend to spend exactly what they earn now (if not more). If you earn $50,000 (after tax) and you spend $50,000 after tax and you know that you are getting a $5,000 raise in the next three months how likely are...

Is Your Brokerage's Bond Desk a Profit Centre?

Posted by Preet on Mar 30, 2010 | 5 comments

Not a question a lot of people ask, but it’s an important one. As an investor, if you buy a bond from your advisor or discount broker you see the price you are offered, but how far off is that from the price the brokerage paid to get it for you? Bond desks can either be run as profit centres or not. When I was at ScotiaMcLeod and I wanted to buy a bond for a client, I would call up the bond desk downtown and get the price for what was in inventory and it was nice to know that our bond desk was NOT run as a profit centre. Ultimately it means the client gets a better price and therefore a better return on their money. Some bond desks, however, are run as profit...

Buying ADRs to Avoid Stamp Duty

Posted by Preet on Mar 29, 2010 | 0 comments

Coincidentally, I was talking to the portfolio manager of our index funds today and part of the conversation was surrounding tracking error and the use of ADRs and GDRs. In a post from last week I had mentioned how using ADRs and GDRs could be a source of tracking error, but there is more to that conversation lest you think you should always avoid depositary receipts. One reason is political risk. For example, our global and emerging markets index funds try to hold the direct stocks on their foreign exchanges as much as possible, but for the case of Russian stocks there is enough concern that getting your money out of the Russian stock exchange might not always be...

Leverage Part 2: The Dark Side!

Posted by Preet on Aug 1, 2007 | 0 comments

So now that you are all hot and bothered about getting an investment loan (aka leverage), let me take you down a notch! (Trust me, it’s for your own good…) :) Okay, so let’s now say that Greg, who if you remember had learned that he would be $2,000 ahead by getting a loan, decides to calculate a few “what-if” scenarios… 1. What if the investment only earns 6%? In this case, the investment’s rate of return and the interest on the loan are equal. How much does Greg have at the end of 10 years? In this case the leverage will leave him with just $13,487 at the end of the 10 years. If he had made the annual savings of $1,000 into...