Your Questions About Successful Trading Companies

Robert asks…

How can I make profits from the stock market?

I am the person who is interested in making the proftis from the investment of the stock market. Could you kindly provide some tips to me to be successful and profitable?

John answers:

Stay away from trying to buy and sell daily. You will end up losing a lot of money to commissions. Strong companies that you have heard of usually stay around so you won’t lose all your money, but will have slightly lower returns. Mutual funds usually have decent returns and less risk.

I have been buying mutual funds and not trading. The balance has continued to grow.

Steven asks…

What Happens to the share of a company that has filed for Chapter 11?

I have 1000 shares of Circuit City CCTYQ trading at 20 cents. What happens if I don’t sell them. If another retailer buys the company, can the stock go up.
Thanks

John answers:

Chapter 11 bankruptcy can also be called rehabilitation bankruptcy. It allows the firm the opportunity to reorganize its debt and to try to re-emerge as a healthy organization. What this means is that the firm will contact its creditors in an attempt to change the terms on loans such as the interest rate and dollar value of payments. Chapter 11 requires that a trustee be appointed. The trustee supervises the assets of the debtor and allows business to continue. It’s important to note that debt is not absolved in chapter 11: the restructuring only changes the terms of the debt, and the firm must continue to pay it back through future earnings.

If a company is successful in chapter 11, it will typically be expected to continue operating in an efficient manner with its newly structured debt. If it is not successful, then it will file for chapter 7 and liquidate.

In both instances, common shareholders will most likely see little (if any) return on their investments.

Maria asks…

What are some jobs one can do while staying home with their small children?

I would like to stay home with my 4 and 1 year old but would still like to earn an income while I do that? Anyone have experience with anything and been successful with it?

John answers:

An excellent source for finding a legitimate home-based business is to check out Direct Selling Association (DSA) at http://www.dsa.org. DSA is the national trade association of the leading firms that manufacture and distribute goods and services sold directly to consumers.

My advice is to go where the money is and that is travel. Travel is a $7.1 billion industry and growing every day. A Baby Boomer is retiring every 8 seconds and the first thing they want to do is travel. The average family in the United States spends $4,200 annually on travel. This is why my wife and I started our own online travel business. We’ve looked for years for a home based business and this is the first thing that made sense to us. The best part is that it sells itself. All you have to do is tell people about it. The industry commissions are already built in. You can also learn to save thousands on your taxes and travel wholesale instead of retail. The company that we work through is publicly traded, SEC regulated, has a $6,000 guarantee, and even offers health insurance. They even send their top agents on a cruise to the Bahamas. No one else does this. We love this business!

William asks…

Has anyone ever sold an Enigin product in the entire world? Is Enigin a real opportunity or a scam?

Are Enigin partners successfully selling products? Enigin Partners pay 16,000 British Pounds to join the Enigin opportunity, so I hope someone out there is making successful sales. We have not heard of any in over 2 years and the partners cannot seem to get their money back from Enigin, according to the LMP forum. Imagine losing 16,000 British Pounds for nothing!

John answers:

Yes, it would appear that some are very successful at selling products, I have spoken to several of their distributors who have made profitable sales even though they were new to the business. I don’t know where you got the figure of 16,000 British pounds from. Where does it say that in their literature? As for the last 2 years if you check Companies House in the UK you will find the Company has not even existed that long.

If we want to avoid getting the dubious reputation of being Internet Trolls – let’s get our facts right before we shoot from the hip!

You refer to them as a ‘scam’, that suggests you must have evidence they are guilty of fraud which is a criminal offense in the UK. Have they sent you information that is ‘fraudulent’? If so post it here because they can be closed down by the Department of Trade and Industry, especially because they are a Public Limited Company (PLC). The Directors of a PLC are much more vulnerable and their accounts are more rigorously audited. On the flip side if you are wrong you could be personally liable to criminal proceedings – so we need to be careful!

According to their published first years accounts they have been trading circa one year! It can take a new company several years to get established in a ‘normal’ market let alone the present financial meltdown. Do you know if they are still as financially sound as they were in March 08? They look incredibly slick, do they have lot’s of experience or big backers?

Do you have any personal experience to advise me if the economic climate is effecting people for good or bad in this business right now?

I have checked the LMP forum you refer to and can’t find anything about their partners not getting their money back!!! I thought the LMP forum was for ‘technical questions’ on motor controllers anyway. Do you have postings on the LMP forum, if so what is your pseudonym?

I am keen to know what in your opinion constitutes a ‘real opportunity’?

I have just done a google to find out what percentage of new businesses actually succeed (regardless of the industry they are in) and it seems lot’s of wannabe business owners fail. Why do you think this is the case?

Personally, I think there is truth in the old adage that a ‘fool and his money soon part’. Anyone with any common sense should way up all the options carefully before jumping in. Starting a new business is ‘high risk’, it is not like buying an established business, but that could set you back hundreds of thousands, possibly millions of pounds.

I have a wide circle of business contacts who have been making a living, some making a fortune, in the energy management business. The difference is; the successful ones work really hard, they are too busy to trawl Internet forums so you won’t see many posting from them and they are prepared to take a long term view of their business. They are not stupid enough to believe in “get rich quick schemes”, are you?

Yours truly,
Anthony B

Lisa asks…

What happens to shares when a merger happens?

If 2 companies merge and i have shares in one – what could happen? Except the obvious of share prices going wither up or down – is there any extra dividends paid out or the such like – do shares predominatly go up or down after a merger?

John answers:

It depends on the nature of the deal. A “cash-and-shares” offer will give the shareholders of one company a cash payout along with shares in the merged company, although typically your holding in the new company would then be worth less than your holding in the original company.

Many company amalgamations are not very successful, at least at first, and shares do tend to go down shortly after such a deal. Also, as almost all mergers are really a takeover of one company by another, speculative trading means that the takeover target’s shares are quite overpriced by the time of the deal, so it may be a good time to sell.

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