Archive for November, 2015
Do you receive monthly payments from a structured annuity settlement that you acquired from a lawsuit, lottery payments, or an inheritance? If so, you’ve probably seen advertisements on tv that entice you to cash in structured settlement payments any time you want a little more spending money– to take a nice vacation, to buy Christmas presents, or to make a luxury purchase, such as a car that you don’t need. If you were to calculate the amount of money you would lose when you cash in structured settlement payments to make a purchase that doesn’t add value to your financial well-being, you’ll probably realize the cost of selling your structured settlement will be far greater than the purchase was w
It’s not secret that the American economy has seen better days. The 76% of average citizens who live paycheck to paycheck can vouch for that. Today, 27% of Americans don’t have any savings, over 40% of households spend more than they earn, and the credit card debt balloon has been inflating rapidly with a net increase of $57.1 billion of new credit card debt last year (2014).
While the situation may seem dire, there are ways that some Americans invest and save their money that can secure their financial futures. Some people receive a structured settlement as the result of either a lawsuit or lottery earnings. These additional earnings can be used in several ways, but if you’re receiving a structured settlement, there are some things you should know and consider.
Lump Sums vs. Structured Settlem
At a time when the emergence of new and innovative companies is back on the rise after the recent financial crisis, these young businesses must compete in a flooded marketplace. Besides creating interesting and original products and services, having the ability to grow is one of the most effective methods for gaining an advantage over competition.
In order to thrive, one of the most effective methods is to use an initial public offering (IPO). The term initial public offering began to slip into everyday speech as of the booming stock market of the late 1990s, when the sale of stocks and shares were flowing like water. In an IPO filing, a company will sell off a small portion of their company at a lower than average price in order for buyers to invest in their business.
The majority of people who take advantage of these early sales of stock are involved in a hedge fund or investment bank. By using hedge fund prime brokers to coordinate the transaction, the buyers will accumulate as much stock as they believe will be the most profitable without putting too much stake in the IPO company.
These institutional investors benefit from buying large quantities of stock from these IPOs by gaining more value on their shares as the IPO company generates more revenue and increases its net worth. The companies executing the IPO benefit from these investment banks by receiving up to triple-digit gains just on the first day of trading. All of these funds can then be used to expand the company to a point that will substantially improve productivity and reach.
One of the major tricks involved in an IPO, is knowing when you are more likely to receive the most interest from investors. As a general rule, when a market is doing well, companies with products or services pertaining to the market will have a successful IPO as well. For example, if SandP 500 is projected to go up double digits in the next year, any corresponding IPOs will likely be up and may even out perform that benchmark.
To find success in an exceedingly competitive marketplace, an IPO company can generate a lot of capital from investors. The trick will be knowing when to do so.