Search

Buying low and selling high is the way to earn the best returns on your investments. This sounds easy enough, but in reality most investors go after what's hot at the moment. The fall of U.S. financials has spurred David Bonderman of the private equity fund Texas Pacific Group (TPG) to put the buy low strategy into action with a $7 billion investment in Washington Mutual (NYSE: WM ). Investors poised in a wait and hold position should weigh the risk of moving in too soon in search of the elusive bottom for financials.Initial InvestmentTPG's investment in the residential mortgage-laden bank WaMu was announced in early April of this year. At the time WaMu was trading below $12 per share as non-performing loans and credit related losses mounted in the financial services industry. The stock took a brief move north of $13 before continuing its downward decline below $5 per share.What Happened?TPG and an unnamed group of investors participated in the $7 billion investment. In exchange, TPG and the group of investors received 176 million shares of common stock at $8.75. That's not all. Additional preferred stock was converted to common stock treating TPG to 227 million shares and the other unnamed investors to 418 million shares. All of the investors have agreed to not sell any of its shares until the 18th month of the deal's anniversary.What's An Investor To Do?True, an investment at this point means that an investor is getting in below the break-even point for TPG shares, but the risks are high. WaMu reported $5.91 billion in loan losses and $2.17 billion in write offs of bad loans for the second quarter ending June 30. Paired with slow job creation, tighter credit restrictions and higher delinquency rates on existing loans, WaMu has a long road to travel to profitability. If you have an appetite for risk WaMu maybe an option, but for the crowd seeking more safety a specialty-finance exchange-traded fund may be more in line with your goals. (To learn more, check out Debt Reckoning and Analyzing A Bank's Financial Statements .)ETF AlternativeVanguard Financials ETF (AMEX: VFH ) delivers broad financial sector exposure for investors thinking of dollar-cost averaging their way in. If there's a large financial services firm that has written down debt, or reported negative earnings, more than likely it's in this ETF. Top holdings include Citigroup (NYSE: C ), Bank of America (NYSE: BAC ) and American International Group (NYSE: AIG ).Final ThoughtsMake sure you can swim before tangling with the big fish. TPG has price protections in place that would lower its $8.75 stock price to protect it from further dilution or a takeover of WaMu. If an individual investor buys in, the last time I checked his or her only protection would be to utilize options or setup a stop-loss order . Perhaps the best choice of all would be to simply choose an investment more suited to their risk appetite.For more on protecting your assets, read Forget The Stops, You've Got Options . At the time of writing Gregory S. Davis did not own shares in any of the companies mentioned in this article. [ABSTRACT FROM PUBLISHER]

The Yale University Endowment has become the standard to measure other endowment funds against for two reasons. First, the fund has returned 17.8% per year since inception in 1978. Second, the portfolio reported a 28% return for its fiscal year in 2007. One of its real estate investments that contributed to the positive returns is REIT Acadia Realty Trust (NYSE: AKR ). Investors who may have a negative outlook on real estate may find that down markets can reveal investment opportunities. In this article we're going to look at the Acacia Realty Trust in closer detail to see what has attracted Yale to the trust, and whether investors should buy in, too. (To learn how to use REITs as your gateway into real estate, read our related articles, The REIT Way and Basic Valuation Of A Real Estate Investment Trust (REIT) .)Brooklyn Right On TargetAcadia Realty Trust focuses on maintaining retail locations in densely populated and resource constrained areas in order to absorb consumer spending slowdowns. One high profile example is its CityPoint project in downtown Brooklyn. As a New York native, I was amazed and happy to see a Target spring out of nowhere in downtown Brooklyn situated near the corner of Flatbush Ave and Atlantic Ave. The location meets all qualifications of a densely populated area in need of traditional retail alternatives. While Acadia also owns shopping center properties in mid-West states like Illinois and Ohio, 85% of its properties are in urban areas in NYC, Northern New Jersey and Connecticut.ValuationAcadia revenues and net operating income for the first half of the year were down slightly from the previous year to $43.4 million and $29.8 million respectively. The decrease was mainly related to a decrease in residential operations revenue. Despite the near term revenue decrease, Acadia's total revenue and funds from operations have increased steadily over the past four years. At the end of last year revenue was up 6% to $101.5 million while FOF was up 10% to $44 million over the previous year. Relative CompetitionRamco-Gerhenson Properties Trust (NYSE: RPT ) and Pennsylvania Real Estate Investment Trust (NYSE: PEI ) are both retail REITs that are similar in size to Acadia. Ramco focuses on properties in the Mid-Atlantic, Mid-West and Southeastern states while the Pennsylvania fund focuses on the Northeast. Since the beginning of the year Ramco, has managed to stay in positive territory by returning nearly 6% to investors, while PEI is down about 30% for the year.Investment ApproachThe Yale Endowment currently owns more than two million shares of AKR. When Acadia Realty Trust traded between $26 and $29 in May of last year, the endowment began doing some light selling to take advantage of appreciation. Silence followed the sales, but earlier this year as Acadia fell below $24 the endowment began to buy in again. Not all at once, but rather buy rebuilding its position in the REIT over the course of a week. Final ThoughtsFor individual investors a dollar cost averaging strategy can be spread out buying over a longer period of time to take advantage of the up and down movements of a particular investment. Real estate may be the current market fall guy, but there is clearly still value in a diversified portfolio with a slice set aside for real assets.To learn more, read DCA: It Gets You In At The Bottom .At the time of writing Gregory S. Davis did not own shares in any of the companies mentioned in this article. [ABSTRACT FROM PUBLISHER]

Weekends that include dinner and a movie equal revenue for property owners like Entertainment Property Trust (NYSE: EPR ). I am a fan of real estate investment trusts (REITs) like these because they are designed to pass a majority their income to shareholders in the form of dividends . The next time you are waiting in line for a movie on a Friday night see if you can figure out which company holds the lease on your favorite theater, you could be staring at an investment opportunity you didn't expect. (To learn more about these investments, read The REIT Way and The Basics Of REIT Taxation .) MegaPlex Properties Entertainment Property Trusts generates the majority of its revenue from the 79 MegaPlex theater properties it owns. At the end of last year more than half of its theater prosperities were leased to AMC Theaters while the others were split between 20 different operators. Entertainment Property Trusts reported at the end of the second quarter that box office sales were up 5% over the same period a year ago. The 5% increase was equally split between an increase in traffic and an increase in ticket prices. Factors contributing to the traffic increase were higher fuel costs which kept people closer to home and a string of high box office earners including "Iron Man", "Indiana Jones and the Kingdom of the Crystal Skull" and "I Am Legend". Recent Performance Entertainment Property Trust's revenue was up 19% for the second quarter from the previous year to $68.8 million. This was led by rental revenue. For first six months of the year, revenue increased 24% to $134.6 million. Entertainment Property Trusts stock is up just over 23% since the beginning of the year. At the end of the second quarter Entertainment Property Trust reported 100% occupancy of its theater properties and 95% for non-theater properties. A comment on the expectation of flat revenue for the third quarter was given on the second-quarter earnings call due to the draw of the Olympics and the presidential campaign. Fellow REITS Other REITs that have preformed well over the same time frame include mall owner and operator Simon Property Group (NYSE: SPG ) and real estate owner/developer Cousins Propertied (NYSE: CUZ ). Final Thoughts It may not be a perfect hedge against rising oil prices, but its certainly an option that makes sense. Higher fuel cost may put long vacations and weekend excursions on hold, but a night out at the theater seems to continue to find a way into people's budgets, and will likely continue to benefit property owners like Entertainment Property Trust. To cut your personal energy bills, read Getting A Grip On The Cost Of Gas .At the time of writing Gregory S. Davis did not own shares in any of the companies mentioned in this article. [ABSTRACT FROM PUBLISHER]

One minute the demand for energy in emerging markets like China and rampant speculation in the futures market pushes oil above $145 per barrel, then you blink and oil prices have dropped below $120 per barrel and the S&P 500 begins to show signs of a recovery. Instead of trying to guess the direction of markets, investors can put their emotions aside and focus on lagging asset classes that are becoming beneficiaries of new money inflows.According to The Wall Street Journal, the PowerShares QQQQ Trust (Nasdaq: QQQQ ) was one of the top recipients of new investment from institutional investors this week. A review of its top three holdings in the QQQQ Trust makes the case for not ignoring technology. (To learn why coattailing the smart money can pay off, read Keeping An Eye On The Activities Of Insiders And Institutions .)Top Three QQQQ Holdings: Tried and True Familiar NamesiExcitementApple's (Nasdaq: AAPL ) products simply amaze and dazzle us. The launch of Apple's new iPhone 3G promises users an even faster and richer multi-touch, multi-application, multi-use experience. Its new ultra-thin MacBook Air and its existing iPod+iTunes combination are likely to be on the top of many back to school shopping lists if young adults don't already own them. Apple's ability to redefine mobile devices, computing and music access make it a well rounded option as the foundation of a diversified technology portfolio. Tech VeteranMicrosoft (Nasdaq: MSFT ) may be playing catch up to internet search king Google (Nasdaq: GOOG ) and locking horns with Apple over PC and media device dominance, but the Redmond, Washington based software provider is still heavily entrenched in the minds of customers as an innovator. Microsoft's Zune player, its Xbox 360, its Vista operating system and its intention to broadcast more than 3,500 hours of live and on-demand video of the 2008 Olympics are clear examples of the companies' ability to break into new arenas and create demand . (To learn more about demand and prices, check out Economics Basics .)Wireless GuruQualcomm (Nasdaq: QCOM ) has been the best performer among the group mentioned here rising nearly 45% over the past 12 months. Qualcomm's push into 3G and eventually 4G technology is capturing the imagination of its end users and investors. 3G technology enables a wider use of wireless devices to send and receive video calls and other broadband wireless data more efficiently. Qualcomm is setting the trend as a market leader in the licensing of its chipsets to original equipment manufactures and breaking new ground by developing innovative solutions to monitor the health of individuals who are on the go. Final Thoughts Commodities work well as a hedge against inflation, but so does a well diversified portfolio that includes exposure to asset classes that are currently out of the spotlight. When faced with uncertainty, remember that chasing today's winners can lead to a bitter future. While technology has cooled, a dollar cost averaging approach into a technology investment maybe the best method to keep balance in the face of volatility . To create your own dollar cost averaging strategy, check out DCA: It Gets You In At The Bottom .At the time of writing Gregory S. Davis did not own shares in any of the companies mentioned in this article. [ABSTRACT FROM PUBLISHER]

Bollywood giant Reliance ADA Group is offering $550 million to help acclaimed director Steven Spielberg and his DreamWorks SKG camp become independent of current parent company Viacom (NYSE: VIA ). DreamWorks SKG falls under Viacom's Paramount Pictures umbrella. Spielberg, who is credited for films including "Saving Private Ryan", "Raiders of the Lost Ark" and "Transformers", is in search of more independence and recognition for his film projects. A move by the DreamWorks camp could possibly leave Viacom without the drawing power of one of the world's most successful film makers. Reliance is a massive Indian conglomerate involved in everything from energy, to telecommunications and finance. It also likes to dabble in movies and produces many of the popular Bollywood films. Spielberg's possible departure could affect investor's media holdings. What Spielberg Means To Viacom Paramount Pictures reported $2.8 billion in feature film revenue for the first half of the year on the strength of Marvel's (NYSE: MVL ) "Iron Man" and "Indiana Jones and the Kingdom of the Crystal Skull" which was directed by Spielberg. The $2.8 billion contribution from Paramount represents roughly 40% of Viacom's revenue during the time period. If DreamWorks and Spielberg have a couple more Indian Jones-caliber movies on the shelf, Viacom may want to hold onto its hit maker. The most recent installment in the Indian Jones series has racked up worldwide box office sales of $740 million. (For more on predicting future sales, read our related article Great Expectations: Forecasting Sales Growth .) Animation Not Part of the Package DreamWorks Animation SKG (NYSE: DWA ) is a separate entity from the DreamWorks SKG group that delivered Indiana Jones. The animation entity, which produced family friendly features including "Shrek", "Shark Tales" and the recent "Kung Fu Panda" is not part of the equity deal being offered by Reliance. Tough Climate Like other media companies including Disney (NYSE: DIS ), News Corp. (NYSE: NWS ) and GE Universal (NYSE: GE ), Viacom has also felt the effects of the difficult economic climate. Viacom's advertising revenue has been down for the year as companies are looking for ways to trim expenses. Viacom has also began to lose popular support with internet users after initiating a lawsuit against Google (Nasdaq: GOOG ), the parent company of YouTube, for unauthorized distribution of video content. Final Thoughts The fall of the credit markets has brought new players to the table with the means to finance movie ventures and lure away top tier talent. Judging by its financial statements, Viacom has been able to shoulder the downturn in the economy , but traders on the street have sent shares of Viacom into reverse. Apparently winning at the box office does not equate to winning positive sentiment from investors. If Spielberg ultimately decides to leave, Viacom will be hard pressed to replace him. For related reading, check out Megatrends For Maximum Profits . At the time of writing Gregory S. Davis did not own shares in any of the companies mentioned in this article. [ABSTRACT FROM PUBLISHER]

It's common knowledge that U.S. consumption is a driving force for the goods imported from nations like China, Mexico and Canada, but far less attention is given to the fact that U.S. exports continue to grow, particularly to this year's Olympic host China. Given the growing trade figures between raw materials suppliers, manufactures and consumers, the shipping lanes around the world should continue to be filled with cargo in the belly of drybulk shippers. In this article I'll explore how a couple statistics and some fact finding make choosing a bulk shipper much easier.General ComparisonNew York based Eagle Bulk Shipping (Nasdaq: EGLE ) transports dry bulk cargo including iron ore, coal, grain, cement and fertilizer through its subsidiaries . Eagle owns and operates 15 Supramax class vessels and three additional Handymax dry bulk vessels. With 35 new vessels on order in Japan and China, Eagle is expecting a total of 53 vessels by 2012 for total shipping capacity of 2.9 million dwt (deadweight tons).Greece based DryShips (Nasdaq: DRYS ) is a holding company which also carries the same drybulk commodities through its subsidiaries as Eagle, but its capacity is much greater. Its fleet of 46 dry bulk carriers includes five Capesize, 31 Panamax and two Supermax vessels, giving it a current capacity of 4.2 million dwt. Dryships also has eight new carries on order.DividendsShipping company stocks are traditionally known for having high dividend yields . Eagle carries on the tradition with a current yield of 7.5%, but DryShips low yield of 1.20% is a break from the norm. Genco Shipping & Trading (NYSE: GNK ) is another trend-following drybulk carrier with a 7% dividend yield.Valuation Value investors can use the PEG ratio to compare companies in the same industry. A PEG ratio below 1 is a strong signal for potential future growth and a complimentary low price-to-sales ratio (P/S) adds more validity to the argument. Eagle has a PEG ratio of 0.45 and a P/S of 9.6, while DryShips has an even lower PEG ratio of 0.05 and a comparatively lower P/S ratio of 3.8. Eagle's higher P/S ratio suggests that investors are paying more per share for each dollar of revenue generated. Bermuda-based Excel Maritime Carriers (NYSE: EXM ) is a smaller drybulk carrier with an equally low PEG ratio of 0.24 and a P/S ratio of 2.9. (Read all about value investing and other strategies in Stock-Picking Strategies .)Market RiskTaking a look at beta , a measure of market risk, versus returns gives investors another viewpoint. DryShips' current beta of 2.78 and its return of 12% over the past 12 months illustrate the marriage between risk and return. A beta of 1 suggests that a particular stock rises and falls with the overall stock market. A beta above 1 increases the opportunity or risk of outperforming or underperforming the market. Eagle's current beta of 1.14 suggests lower volatility in relation to market swings. Eagle returned about 5.5% to investors over the same previous 12-month period.Final ThoughtsExcel Maritime with a beta of 2.25 returned 2% over the last 12 months, indicating that one valuation metric is not enough to measure the potential returns of an investment. Rather, investors are better off beginning with an investment theme followed by the use of a couple valuation metrics when comparing companies in the same industry that look more alike than not. For more on finding the right investment theme for you, check out Beta: Gauging Price Fluctuations and Personalizing Risk Tolerance .At the time of publication Gregory S. Davis did not own shares in any of the companies mentioned. Personalizing Risk Tolerance [ABSTRACT FROM PUBLISHER]

As the weak U.S. dollar makes foreign market securities more appealing, the Mexican peso has been trading near six-year highs. After the U.S. stock market hit its peak last October, the iShares MSCI Mexico Index (AMEX: EWW ) carried forward as a stronghold for investors seeking Latin American exposure. Although Europe, Australia and the Far East (EAFE) may be the first place investors turn to for international exposure, a tour south of the border may offer additional diversification to absorb market declines. ETF Index Comparison Exchange-Traded Fund YTD Return* One-Year Return* iShares MSCI EAFE Index (AMEX: EFA ) -10.86% -11.10% iShares MSCI Mexico Index (AMEX: EWW ) 2.66% -4.96% SPDRS (AMEX: SPY ) -12.06% -13.65% *As of June 30, 2008 [ABSTRACT FROM PUBLISHER]

State Street (NYSE: STT ) is a leader in providing financial services including asset management, trade settlement and client reporting to institutional investors like state pension plans. Earlier this week, the Massachusetts Pension Reserves Investment Management Board (MassPRIM) decided to move approximately $720 million worth of assets from existing money managers into State Street's Global Russell 3000 index portfolio. The reallocation of assets should make investors curious about the potential of State Street Global as an investment and watchful of how large money managers are repositioning their portfolios in an attempt to improve future returns. (To learn more about the story, read " MassPRIM axes Leg Mason, 4 Others ".)Second Quarter SnapshotState Street reported record revenue of $2.7 billion for the second quarter of the year. The record revenue was driven primarily by its acquisition of Investors Financial Services Corporation, increases in securities finance fees (generated from spreads on securities on loan) and net interest revenue. Although State Street's assets under management did drop slightly to $1.89 trillion in comparison to the same period a year ago, institutional money managers are still turning to the Boston-based financial services provider. At the end of July Lazard Asset Management selected State Street to handle investment management operations of its $134.1 billion in assets.New Investment DirectionThe assets reallocated to State Street by MassPRIM were part of a larger move of a total $1.8 billion reallocated to new money managers focused on portable alpha strategies like BlackRock's (NYSE: BLK ) Alternative Asset Management group. Both the investment in the State Street Global Russell 3000 index and the funds flowing into portable alpha strategies are meant to move the pension fund away from active asset management in favor of indexes and other investment vehicles that allow for more diversification. For individual investors the implication is to consider adding exchange traded funds (ETFs) that track indexes or non-correlated asset classes in order to operate like institutional money managers. (To learn why active management may not be worth the price tag, check out Words From The Wise On Active Management .)CompetitionSimilar institutional financial services are provided by the Bank of New York Mellon Corporation (NYSE: BK ) and Northern Trust Corporation (Nasdaq: NTRS ). Last year State Street generated total revenue of $9.97 billion while BNY Mellon and Northern Trust reported $14.5 billion and $4 billion respectively. The operating margins for each were 34% for State Street, 33% for BNY Mellon and 35% for Northern Trust.Final ThoughtsState Street's stock is up about 13% over the last 30 days, due to a higher earnings outlook for the year. If more large institutions continue to outsource their asset management operations or adopt the passive approach for their asset management methodology State Street may be a primary beneficiary of assets in search of new life. To learn what effect institutional investors have on the stock market, see The Market Participant Playbook .At the time of writing Greg Davis did not own shares in any of the companies mentioned in this article. [ABSTRACT FROM PUBLISHER]

Covanta (NYSE: CVA ) is hoping to profit from the scramble for renewable energy by converting trash that would otherwise sit in landfills into electricity. Investors building their alternative energy portfolio should consider adding energy-from-waste (EFW) players since future legislation and international acceptance could put companies like Covanta and Waste Management (NYSE: WMI ) at the top of the heap.Strong Second Quarter from CovantaCovanta is more of a pure play in the EFW space with operations setup in the Americas, Europe and Asia. Covanta's revenue for the second quarter ending June 30 was up 19% from the same period a year ago to $423 million. For the first six months of the year, Covanta's revenue was up more than 18% to $812 million. The increase was led by its electricity and steam sales. Since the beginning of the year, Covanta stock has fallen into negative territory, but over the past year its stock is up more than 23%. Waste Management Hobbled by SlowdownWaste Management generates most of its revenue from trash collections and landfill operations, but it also has waste-to-energy technology. Its primary renewable focus has been on transforming methane gas emitted from landfills into energy. Waste Management reported a 3.9% increase in revenue for the second quarter over the prior year to $3.5 billion. Higher fuels costs and increased competition have been difficult challenges for Waste Management to overcome. A slow down in construction and the completion of landfill operations contracts with municipalities has also hindered revenue growth in its waste-to-energy business for the first half of the year. Insider Selling and Pending LegislationReal Estate entrepreneur Samuel Zell and a related trust sold 7 million shares of Covanta at the end of July. Although it's a large transaction public records show that Zell still owns more than 19 million shares and continues to be a Covanta board director. (To learn more, read Insider Selling Isn't Always A Bad Sign .)Tax credits for producing energy from municipal solid waste have been passed by Congress, but a decision from the Senate is pending and may close before the end of the year. If statewide mandates are put into place with specific language detailing the amount of waste that must be converted to energy, these players could be in a great position to benefit.Final ThoughtsWith each bag of trash investors throw away, they should consider that one day an EFW player may have a contract with their municipality to turn this waste into the energy necessary to power their home. Trash is proving not only to be another man's treasure, but also another man's power. To learn how innovations in energy and consumption relate to investing, read For Companies, Green Is The New Black and our Green Investing Feature .At the time of writing Gregory S. Davis did not own shares in any of the companies mentioned in this article. [ABSTRACT FROM PUBLISHER]

If you type any of the words "annoying", "worst" or "terrible" into your internet search bar combined with the phrase "corporate mascot", you're bound to run into Aflac's (NYSE: AFL ) ubiquitous quacking duck. The little white duck with the one-word vocabulary is a fixture in virtually every top-10 list of most annoying commercial characters. Some might see this as a bad sign, but there is no denying that Aflac has managed to parlay a simple and cheap concept into some serious name recognition. Now Aflac has decided to increase its visibility by attaching its name to America's fastest growing sport, NASCAR. Aflac's Push into NASCAR Aflac's NASCAR driver Carl Edwards is among the point leaders for the 2008 racing season. His performance on the track is reminiscent of the company's persistent push to become the primary provider of financial security for its policyholders. As a dominant provider of life insurance products Aflac's focus on advertising in the U.S. and its strong presence in Japan make it an insurer worthy of investors' attention. Aflac has crashed its way into Nascar over the past 18 months. It began by sponsoring eight races in the NASCAR Nextel Cup Series and Busch Series last year and followed up in May 2008 by becoming the exclusive supplemental insurance partner of NASCAR through 2010. If nothing else, Aflac has guaranteed that millions of the country's racing fans will be unable to escape hearing and seeing the Aflac name at upcoming races. In addition to NASCAR other large U.S.-based Aflac customers include Valero Energy (NYSE: VLO ), American Express (NYSE: AXP ) and Wal-Mart (NYSE: WMT ). The Benefits of International Exposure Aflac revenues increased more than 15% for the second quarter to $4.3 billion over the same period a year ago. Aflac's U.S. revenues totaled $1.2 billion representing less than one-third of Aflac's revenue during the quarter. Translation exposure , a stronger Japanese yen versus the sluggish U.S. dollar, helped to boost revenue. Aflac notes that it uses an average conversion rate when reporting yen denominated revenue, so investors should not necessarily rely on Japanese revenue as a pure sign of business growth. (For more on the effects of exchange rates, see Taking Advantage Of A Weak U.S. Dollar .) Valuation Aflac has a PEG ratio below 1 at 0.95 and a low price-to-sales (P/S) ratio of 1.70. Value investors often seek out companies with a PEG ratio below 1 as a sign of an undervalued stock. PEG is a ratio used to determine the expected growth over the next five years in relation to its earnings. The P/S ratio is another way for investors to evaluate how much their paying for a stock in relation to revenues generated by the company. For both valuation ratios lower numbers generally equate to more attractive investment options. Other accident and health insurers with equally low PEG ratios include Assurant Inc. (NYSE: AIZ ) with 0.82 and StanCorp Financial Group (NYSE: SFG ) with 0.86. (For a detailed explanation of value investing, check out Stock-Picking Strategies: Value Investing .) Final Thoughts Insurance typically comes to the front of people's minds once they really need it. Aflac is working to be the insurer customers turn to before unforeseen life events take place. With its memorable white duck quacking away in television commercials and its popularity as a trusted insurer in Japan, Aflac's focus on protecting its customers is unlikely to go unnoticed. At the time of writing Greg Davis did not own shares in any of the companies mentioned in this article. [ABSTRACT FROM PUBLISHER]

On mornings when I'm preparing to wear the classic banking style white shirt, more often than not the T-shirt underneath happens to be from Hanesbrands (NYSE: HBI ). I choose Hanes because the shirt breathes well and is exceptionally comfortable. As a believer in investing where you spend your dollars, Hanes deserves a review from me and from investors who may be unaware that Hanes has them covered.Hanes Stained By Falling SalesGiven the problems in retail, it's not surprising that Hanes experienced falling sales during the second quarter. With revenue of $1.1 billion for the second quarter, total revenue for the first six months of the year reached $2.1 billion, down 4.7% from the same period a year ago. Hanes reported an operating profit of $120 million for an operating margin of 10.4%. This was nearly identical to the 10% operating margin reported for the same period a year ago. The decline in revenue led to a one-day five- point drop in Hanes stock price at the end of July.Hanes reported higher inventories during the second quarter partly in response to continued concerns over the cost of raw materials including cotton, oil, freight and currency. Hanes has been reluctant to raise prices for its apparel, but if commodity prices do not abate, the decision will have to be implemented. (For related reading, check out Measuring Company Efficiency .)Looking Forward To Q3A later start for school means that Hanes will have the opportunity to include revenue from back-to-school shopping during the third quarter. The missed revenue was expected to fall in the second quarter. The third quarter also puts Hanes closer to the crown jewel for retailers, the holiday shopping season.In search of cost cutting measures Hanes opened two sewing plants in Vietnam and one in Thailand bringing its total number of plants in Asia up to four. Ramping up production in larger plants in Central America and the Dominican Republic are also meant to limit the costs of producing and transporting Hanes apparel.Apparel RetailersVF Corp.'s (NYSE: VFC ) stock has proved to be more resilient since the beginning of the year, rising over 6% year to date while Hanes has fallen nearly 18%. VF is the company behind several popular brands including Wrangler, Lee Jeans, Vans, North Face and Eastpak. The company reported 11% growth in revenue up to $1.67 billion for the second quarter driven largely by sales from its outdoor division. Its North Face brand revenues increased 40% while its Vans revenues also increased 14%. Polo Ralph Lauren (NYSE: RL ) is another apparel retailer to consider since its stock is down less the 5% year to date while the S&P 500 is down nearly 16%.Final ThoughtsA dollar-cost averaging approach may be the best option for investors who have an apparel investment in mind with no idea of when to actually buy in. I cannot predict the future, but I do know that buying quality at a discount is the best way to make it through a volatile market.For more on this strategy, read Dollar-Cost Averaging Pays .At the time of writing Greg Davis did not own shares in any of the companies mentioned in this article. [ABSTRACT FROM PUBLISHER]

Healthcare is a hot sector for investors to follow given the growing needs of 77 million baby boomers and its prominent position in the ongoing U.S. presidential race. However, strong returns on investments in biotechnology from cancer fighters like Celgene (Nasdaq: CELG ), versus market lagging returns from healthcare plan providers like Humana (NYSE: HUM ) reveal that all healthcare investment options are not the same.Before selecting a fund or investment with the healthcare label attached, investors should take the time to determine which stocks are most likely to boost portfolio health.Fidelity Select Medical Delivery (Nasdaq:FSHCX) is a specialty healthcare fund, and it's down about 25% since the beginning of the year. The largest market underperformers in the fund's top 10 holdings include: [ABSTRACT FROM PUBLISHER]

The Children's Investment Fund (TCI) is a bit of an enigma. The U.K.-based hedge fund has a reputation for ruthless shareholder activism and it has returned about 40% for its individual investors since inception, yet this harsh exterior is softened by a charitable foundation - quite literally. A portion of the fees the fund collects from investors goes toward the Children's Investment Fund Foundation, a non-profit organization dedicated to fighting AIDS in Africa and various other activities designed to help the lives of children. Activist investor Christopher Cooper-Hohn, manager of TCI, has been at work buying large shares of publicly traded companies in order to change management and drive shareholder value. Investors who believe in this give-and-take philosophy of activist investors may be able to follow TCI's lead by choosing investments on the hedge fund's hit list. (To learn more about shareholder activists, read Activist Hedge Funds and Can You Invest Like Carl Icahn? ) A select few of TCI's holdings are listed below. Let's have a look at how they have faired under the fund's watchful gaze. [ABSTRACT FROM PUBLISHER]

Solar power may seem like the ultimate place for investors to invest based on high-flying stock returns from companies like First Solar (Nasdaq: FSLR ) last year, but most investors like a menu of green options. The First Trust Nasdaq Clean Edge US Liquid Series ETF (AMEX: QCLN ) is comprised of U.S. companies that manufacture and install clean energy technology related to solar power, biofuels, batteries and other green sources. As more people become energy conscious, this exchange-traded fund (ETF) is likely holding winners investors will want to follow. (For more on investing in sustainable businesses or ETFs, check out Clean Or Green Technology Investing or Pump Up Your Portfolio With ETFs .) [ABSTRACT FROM PUBLISHER]

Microfinance , once the providence of small regional lenders and NGOs, is now a growing trend for some of the world's largest and most powerful corporations. The small lenders who began lending money to help poor people in underdeveloped countries to start or expand a business, have been joined by larger conglomerates like General Electric (NYSE: GE ) and investment banks like CitiGroup (NYSE: C ). Of course, this move has been met with skepticism. What does GE have to gain by financing a $100 loan to someone in Tanzania or Haiti?It's important for investors to understand where small and large institutions are branching out into the world and then decide if microfinance fits into their asset allocation mix.Demand for MicrolendingDeutsbank Bank (NYSE: DB ) estimates the global demand for microlending to be $250 billion, while only a fraction of that amount is currently being met. Last month Citi Microfinance extended a $10 million credit facility to ASA, a leading microfinance lender based in Bangladesh. ASA is recognized as one of the world's leading microfinance lenders by offering favorably low rates of interest for borrowers and relatively high rates of return on assets for lenders.GE Money in Frontier MarketsEarlier this month GE Money made a $1.5 million three-year commitment to help FINCA's Village Banking , one of the largest providers of basic financial services to the poor. The goal it to reach 1 million of the world's lowest income entrepreneurs by 2010. Early target regions for funding include the Middle East, Africa and Asia. The loans typically range from $50 to $100 in size and are repaid over the course of four months. Barclays in UgandaBarclays Bank (NYSE: BCS ), in cooperation with US NGO Care International, is funding the expansion of microfinance lenders in Katine, Uganda. The Katine Project , the formal name of the lending program, aims to improve income levels, graduate successful borrowers to commercial loan status and ultimately create new customers. With only 4% of Africans holding bank accounts, the opportunity for Barclays to grow along with the country and the continent is tremendous.Conflicts of InterestThe intentions of institutions moving into microlending strictly for the sake of making a profit versus making a difference is being debated. Exorbitantly high interest rates on some loans draw red flags, while issuers of the high interest rate loans counter with a list of risks taken by the lenders to provide the loans often without the backing of any collateral from the borrowers. It's a sad state of affairs when one hopes the big companies are getting into microfinance for publicity, but that may be preferable to darker, more exploitive motives. (For related reading, check out The Green Marketing Machine .)Final ThoughtsOn an individual level people are using nonprofits like Kiva to select entrepreneurs from around the world in order to loan money directly to them. Individual microlending does come with the risk of non-repayment. For investors who are giving for the sake of giving, the investment can be worth the risk when you consider the potential aid the money will provide. As larger institutions branch into non-traditional lending spaces, individual investors may choose to research their own microfinance opportunity suitable for their own microlending desires.For more on alternative lending, check out our related article Peer-To-Peer Lending Opens Doors For Lenders/Borrowers .At the time of writing Gregory S. Davis did not own shares in any of the companies mentioned in this article. [ABSTRACT FROM PUBLISHER]

Gas prices have seen a brief reprieve from their northward ascent. A barrel of crude is down to $123 from its record pricing near $145. The National Average for a gallon of regular unleaded is down to $3.96 from $4.07 last month. While not a major decline, prices may be even lower depending on where you live. The falling prices have arrived just ahead of the back-to-school shopping season. Investors may only need to ask friends or themselves where their headed for children's apparel to find a potential "break in gas prices" investment. TJ Maxx Outpaces Wal-MartI'm sure that Wal-Mart (NYSE: WMT ) and Target (NYSE: TGT ) may come to mind immediately, but investors should also consider the low price clothing and housewares retailer TJX Companies (NYSE: TJX ). TJX Companies sell its goods primarily through TJ Maxx, Marshalls, A.J. Wright, and HomeGoods stores in the U.S. TJX also has retail locations in Canada and Europe. The underperforming Bob's Stores is another casual clothing provider under the TJX brand that may be sold in the near future.Since the beginning of the year TJX is up nearly 16% trailing only the approximately 20% return of Wal-Mart. Over the previous three years, a different story emerges with TJX returning 36% to investors while Wal-Mart returned just 14%.ValuationFrom a valuation standpoint TJX offers a low price-to-earnings growth (PEG) ratio of 1.03 and an even lower price-to-sales (P/S) ratio of 0.73. The PEG ratio is a measure of the expected five-year growth rate of earnings and the P/S ratio is the relative value of the stock price to current revenues. Valuation ratios near 1 or below are strong signals of value opportunities. Competitors with equally impressive valuation numbers include Kohl's (NYSE: KSS ), Macy's (NYSE: M ) and Target, but TJX has proved to be the most resilient in response to rising oil prices over the past year.All together the TJX companies generated revenue of $18.9 billion last year with an operating margin of 6.72%. In comparison, Kohl's generated revenue of $16.5 billion with an operating margin of 10.47%. (To learn more about this valuable calculation, read Analyzing Operating Margins .)For TJX's first quarter ending April of 2008 revenue increased 6% from the previous year to $4.4 billion and its all-important same-store-sales figures increased 3%. Notably, half of the same store sales increase was related to favorable currency exchange rates. Strong sales from its international retail locations were responsible for the other half of its positive returns.Final ThoughtsThe average price for a gallon of regular gas a year ago at this time was $2.90. An investment in TJX Companies a year ago would have returned nearly 20%. My initial thoughts did not lead me to think of an apparel and housewares retailer as an oil inflation hedge, but the numbers have helped me draw an entirely different conclusion. Happy Shopping! Pick out your next investment on your next trip to the mall! To learn more, read Analyzing Retail Stocks .At the time of writing Gregory S. Davis did not own shares in any of the companies mentioned in this article. [ABSTRACT FROM PUBLISHER]

There is a new world of investment opportunity lying beyond the usual international options that have become all too familiar. Investors have been inundated with information about emerging markets like Brazil, Russia, India and China , while future bright spots including the Middle East, Nigeria and Vietnam have been largely ignored. Asset management firms like T.Rowe Price (Nasdaq: TROW ) and Merrill Lynch (NYSE: MER ) are creating funds and indexes covering these forgotten territories.What are Frontier Markets?Frontier markets are countries or regions where political instability and economic security have lingered for decades. Interest in frontier markets is tied to their potential for infrastructure development, commerce and modernization, which are the same qualities that attracted investors to the emerging market several years ago. The growth potential for the frontier markets also presents an opportunity for investors to participate in equities that are non- correlated to U.S. markets. Real GDP Paints the PictureDespite having that largest economy in the world at $14 trillion, the U.S.'s real GDP dragged at 2.2% for 2007. The outlook for the U.S. GDP, which is largely driven by the services it provides, is not expected to exceed 2.5% over the next 4-5 years. Meanwhile oil-rich countries like Nigeria reported real GDP of 6.2% last year with an expectation of continued growth at the same rate or higher over the next few years. (To learn more on real GDP, read Macroeconomic Analysis .)Frontier Market FundsIn September of last year T. Rowe Price introduced its T.Rowe Price Africa and Middle East Fund (TRAMX). The fund was performing well above the performance of the S&P 500 and the MSCI EAFE Index in June when oil prices were setting records near $145. Since oils recent pullback, the fund is basically flat for the year. TRAMX is composed of mostly financial services and industrial companies in Qatar, the United Arab Emirates, Egypt and South Africa.In March, Merrill Lynch launched a Frontier Index composed of 50 stocks from 17 countries in Europe, the Middle East, Africa and Asia.In June ETF provider Claymore Securities launched the first frontier ETF named the Claymore/BNY Mellon Frontier Markets ETF (NYSE: FRN ). FRN focuses on stocks in Eastern Europe, Asia, Africa and another important region that we have not yet mentioned, Latin America.ConclusionThe social, religious, political and economic risks of investing in frontier markets are many, but the growth story and potential of these regions cannot be denied. I'm not recommending you jump right in and invest, but if you didn't know which rising economies were on the investment horizon at least now you've been exposed to the frontiers beyond the usual emerging markets.Find out how these worldly offerings can spice up your portfolio in our article Go International With Foreign Index Funds .At the time of writing Gregory S. Davis did not own shares in any of the companies mentioned in this article. [ABSTRACT FROM PUBLISHER]

Uncertainty is all around us. The housing market in most U.S. states is declining; the stock market is down 500 points one week then up 350 points the next, and elevated commodities prices have investors wondering if they've peaked or are poised for further gains. This uncertainty equals business for asset management firms like BlackRock (NYSE: BLK ) that offer institutions and individuals a wide range of investment options and advisory services. Investors building a portfolio of companies who are strong in providing asset management services should not overlook the following.Merrill Won't SellBlackRock has nearly $1.4 trillion in assets under management (AUM). For the first three months of the year revenue increased 29% to $1.3 billion over the same period a year ago. On a GAAP basis, BlackRock's operating margin was up 3% to 30%. These numbers help explain Merrill Lynch's (NYSE: MER ) decision not to sell off its 49% stake in the investment advisory firm. Merrill recently sold off its Bloomberg business to help mitigate its exposure to credit related write downs .Alternative Investments Growing Notably, BlackRock's alternative investments business doubled in size to $73 billion from the previous year, making it the fastest growing segment of the firm. Part of the growth was attributable to BlackRock's acquisition of Quellos Group, a hedge fund of funds , last year. While alternative investments still represent less than 6% of BlackRock's total AUM, this business segment is likely to continue growing as more institutional investors are seeking out this non-correlated asset class. Having a diverse basket of investment options like alternative investments is key for BlackRock's future growth. (To learn about FoF investments, check out Fund Of Funds - High Society For The Little Guy .)Asset Manager to ConsiderBlackRock's stock recently recovered from a 20% decline in value. Investors looking for an asset manager at a better bargain price should consider Legg Mason (NYSE: LM ). Trading near $40 per share, Legg Mason is below its current book value suggesting a discount to its fair market value. Although Legg Mason's AUM fell less than 2% to $950 billion at the end of its fiscal year in March, revenue rose almost 7% to $4.6 billion. Legg Mason was able to increase revenues by generating additional fees from its fixed income business line Western Asset Management, its mutual fund provider Royce & Associates, and its funds of hedge funds management firm Permal Group. For investors with a low risk tolerance, be advised that Legg Mason has lost nearly 50% of its value since the beginning of 2008.Final ThoughtsWhen the markets are on the rise, everyone offering advice appears to have the golden touch. It's the firms with the widest range of product offerings and services who will win earn the most fees and survive the present storm. [ABSTRACT FROM PUBLISHER]

Weather is big business, not only for insurers that provide protection from the aftermath of a storm, but also for services that can forecast or offer protection against unforeseen occurrences. On July 6, General Electric's (NYSE: GE ) subsidiary, NBC, agreed to pay an estimated $3.5 billion to buy the Weather Channel, which also includes Weather.com. Accurate weather predictions have value not only for planning weddings and picnics, but also for investors and the business world. Let's take a look at how weather forecasts impact business activity.Weather Forecasting Service ProviderWeather Trends International was recently profiled on the ABC network for the weather forecasting services it provides to well-known clients, including retailer Wal-Mart (NYSE: WMT ), clothing manufacturer VF Corp. (NYSE: VFC ) and the investment banking firm Citigroup (NYSE: C ). Weather intelligence allows companies to time marketing events and product offerings, and to better estimate future orders based on variations in temperature, rainfall and other factors. For this service, the companies pay an undisclosed fee. The return on investment has turned Weather Trends' users into loyal clients. Individuals can also use Weather Trends' free service to forecast weather conditions one year ahead for events such as weddings or vacations. Banking on the WeatherWeather derivatives are another reason why predicting the weather has become a business activity. These financial instruments work like an insurance policy against poor market conditions. For example, suppose that a gas utility company pays a premium to a weather derivatives broker like TFS Energy LLC to protect itself from financial losses due to an unusually warm winter. If the weather proves to be warmer than a predetermined benchmark, the utility receives a payment based on the value of the contract purchased. If the weather turns out to be normal, the derivatives broker keeps the premium. In this case, the utility company protects itself by ensuring a certain level of income over the winter - if it's warm, the income will come from the derivative, if it's cold, it will come from customers. (To learn more, read Introduction To Weather Derivatives .)The $32 billion weather derivatives market is driven by banks, utilities and hedge funds . In June, the Weather Risk Management Association out of Washington, D.C., reported a growing use of weather derivatives from India, Latin America and Southeast Asia. The World Bank is also proposing to use weather derivatives to reduce the threat of drought in developing countries. If a tragic event occurred, the World Banks client country would receive a payout from the bank. The Chicago Mercantile Exchange (Nasdaq: CME ) is home to the majority of the weather derivatives traded. Banks with weather trading operations include Merrill Lynch (NYSE: MER ) and Credit Suisse Group (NYSE: CS ).Farmer's AlmanacA favorite read among commodities traders who want to get a leg up on future weather conditions is the Farmer's Almanac. Weather forecasts for the year are critical to farmers, and futures traders and investors who are eager to determine how an unusually wet or dry season will affect crop prices may look for answers here.ConclusionPredicting the weather is not an exact science; in fact, none of the forecasting services mentioned predicted the recent flooding in the Midwestern U.S., but business interest in the weather should continue to grow. Even without the 100% guarantee weather forecasting service buyers would prefer, it appears that walking into a dark room with a flashlight is better than walking in blindfolded. At the time of writing Gregory S. Davis did not own shares in any of the companies mentioned in this article. [ABSTRACT FROM PUBLISHER]

Rebalancing your portfolio is just as important as having the right asset allocation. If you've been holding commodities or commodity-related stocks, now may be the time to take profits and refocus on assets that are lagging. It's not a matter of market timing for investors, but rather a strategy built on trimming winners and rebalancing to take advantage of the discounted laggards. (For more information o keeping your portfolio efficient, read our related article Rebalance Your Portfolio To Stay On Track .) Identify Recent Winners Investments in energy have handily outperformed the overall market in 2008. The PowerShares Oil ETF (AMEX: DBO ) and the PowerShares Energy (AMEX: DBE ) are both up over 40% since the beginning of the year. DBO holds oil futures contracts while DBE is a more diversified holding nearly equal holdings of heating, crude, and gasoline futures contracts. Whether driven by speculation or accurate demand expectations both ETFs have benefited from oil futures prices rising above $145 in July. (To learn more about futures contracts, read The Barnyard Basics Of Derivatives .) The Pullback Oils strong upward momentum set the stage for its recent pullback near $130 dollars per barrel. Since market timing is nearly impossible, investors may be better off establishing rebalancing routines either by performance or time to trim portfolio winners. Reallocating by Performance Let's say you have a 15% return goal in mind for your investment. Once the 15% threshold is reached an investor could simply sell shares equal to the amount of money gained over the initial investment and reallocate the funds to faltering asset. This strategy allows the investor to continue to benefit from the initial investment position, purchase falling assets at a discount, while offering protection from a reversal in the form of profits generated from the investment gain. Retirement accounts like an IRA or a 401(k) are the best places for this strategy in terms of minimizing your tax liability from capital gains . (To learn how to minimize the impact of capital-gains tax, see A Long-Term Mindset Meets Dreaded Capital-Gains Tax .) Reallocating by Time An investor could make a commitment to review and rebalance his or her portfolio on a quarterly, semi-annual or an annual basis. For example, an investor with a medium risk tolerance may have composed a 50% stock, 40% fixed income and 10% natural resources (energy) portfolio in January. On a semi-annual schedule, once June arrives if the energy positions have grown to become larger than a 10% portion of the entire portfolio, shares of energy positions would be sold and the earnings would be reallocated to the stock and fixed income buckets. This strategy allows time to dictate when to rebalance rather than performance and can often be setup when opening your investment account. The TDAX Independence 2040 (AMEX: TDV ) and the TDAX Independence 2010 (AMEX: TDD ) are two relatively small target-date ETFs that employ the reallocation by time principle to help investors underlying investments take on less risk as they approach retirement. (To learn more about target-date funds, check out The Pros And Cons Of Life-Cycle Funds .) Conclusion Rebalancing is a great way for investors to stay in tune with overall market activity and improve returns by capturing gains and reinvesting in laggards. If rebalancing is not for you, know that mutual funds and now ETFs are available to do the job for you. At the time of writing Gregory S. Davis did not own shares in any of the companies mentioned in this article. [ABSTRACT FROM PUBLISHER]

Architectural design firm Dynamic Architecture is determined to build one of the most innovative skyscrapers ever conceived. The vision entails an 80-story skyscraper with individual apartments on each floor that can rotate 360 degrees on an axis offering a full panoramic view of the buildings surroundings in Dubai. The design incorporates horizontally mounted wind turbines between each floor. The 79 turbines are expected to generate enough power for the entire building. Currently only a handful of publicly traded companies in the U.S. make wind turbines for investors to choose from for their wind energy investment. Siemens SnapshotGermany's Siemens (NYSE: SI ) offers on-shore and off-shore wind generation capabilities. With more than 6,000 installations, Siemens reputation in wind power generation is solid. In the past six months just within the U.S., Siemens received large wind turbine orders with a combined value of more than $2.4 billion from FPL Energy (NYSE: FPL ) of Florida, Portland General Electric (NYSE: POR ) of Oregon and two wind farms in Washington.To keep pace with new orders Siemens is having to expanding existing and create new facilities in the U.S., leading to the creation of "green collar" jobs. Siemens is also conducting a two-year study on direct drive (DD) technology on a test turbine in Denmark. The DD technology is meant to cut down on maintenance cost of its existing turbines with gearboxes. (Whether you want funds or stocks, find out how to evaluate planet-friendly portfolio picks in Evaluating Green Equity Investments .)GE SnapshotGeneral Electric (NYSE: GE ) is the world largest wind turbine maker, with more than 8,000 installations. GE offers an array of wind turbines ideally suited for locations short on space as wells as larger turbines for offshore farms with rotor diameters of 341 feet. At the beginning of this year American Wind Energy Association noted that GE turbines were responsible for nearly half of the 5 gigawatts of new wind energy capacity brought on line in the U.S. in 2007. Demand for GE's turbines has placed pressure on its wind-blade-components suppliers who are also being driven to expand production creating additional work for new hires.Wind Power Diversification Made EasyFor instant diversification investors could also perform due diligence on the First Trust Global Wind Energy EFT (AMEX: FAN ). The exchange-traded fund debuted in June and tracks the International Securities Exchange Global Wind Energy Index. The index is composed of companies in multiple countries including Germany, Spain and Denmark directly or partially related to generating wind energy. ConclusionWind power is growing in popularity with utilities, builders and investors. It is a renewable energy source that continues to become a larger component of meeting global energy demand with the added benefit of adding jobs to the workforce. The choices for investment in the U.S. are few, but the opportunity wind power presents is undeniable.For further reading, and to put a little green in you wallet, read our related article Top 10 Green Industries .At the time of writing Gregory S. Davis did not own shares in any of the companies mentioned in this article. [ABSTRACT FROM PUBLISHER]