Ecobank to open subsidiary in France Thursday, Jun 18 2009

Ecobank Group, the Pan African bank is planning to open a subsidiary in France and new subsidiaries in Africa this year.
The planned subsidiary in France will be the first to be opened outside the African continent.
Mr. Arnold Ekpe, chief executive officer of the group stated this in Lagos yesterday while addressing senior officials of the Nigerian Stock Exchange (NSE) and dealing members of the NSE at facts behind the figures programme.
He said “In 2009, we intend to open five new subsidiaries including a subsidiary in France,” adding that this will bring the total number of countries in which the bank is present to 30.”
He said those are countries for which licenses had previously been obtained, remarking that with the exception of two other countries of strategic importance, the bank’s geographical expansion is coming to an end.
He said 2009 would be a year of consolidation for the group, during which it intended to focus on improving the performance of its existing businesses, adding that as the new affiliates begin to mature and as less funding is required for expansion, they shall begin to see a significant improvement in the performance and profitability of the group.
He said as a listed company, Ecobank would ultimately like to be considered as a preferred investment destination that offers superior, diversified and stable returns.
“We are entering a new phase for the Ecobank group: as our geographical expansion comes to an end, we shall increasingly focus on improving customer service, efficiency, productivity and performance, with the unchanged objective of building a world class pan-African bank,” Ekpe said.
In 2008, revenues grew by 52 per cent to $826 million as a result of a growth in business volumes. The bank recorded significant growth in deposits, branch network, net interest revenues and fees and commissions.
Revenues in the African region experienced substantial growth. For instance, the bank’s business in Nigeria grew by 55 per cent, the UEMOA region, comprising affiliates in French speaking West Africa grew by 44 per cent..
Other operations in the West African Monetary Zone (less Nigeria) also performed well, growing by 44 per cent during the year while Central Africa operations grew by 72 per cent while the newly established eastern and southern Africa operations grew by 556 per cent.
Overall, gross revenues (excluding interest expense) increased to $1,156 million but profit before tax dropped by 15 per cent to $ 162 million.
Ecobank’s efficiency ratio deteriorated to 67 per cent from 61 per cent because of its continued heavy investment in expansion in more countries and branch network.
It also continued investment in improving technology and processes and in strengthening the capital base of its affiliates.
On the whole the group invested $110 million in this manner and its value added, after these investments, was $586 million against $524 million in 2007.

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Central bank rate decisions to move European stocks Tuesday, Apr 8 2008

Interest rate decisions from the European Central Bank and the Bank of England may move European stock markets next week. Investors will also be watching earnings from Signet Group Plc, the world’s largest jewelry store owner.
The Dow Jones Stoxx 600 Index climbed 3.7 per cent this week as of 2:50 p.m. in London. The Stoxx 50 added 4.5 per cent this week, while the Euro Stoxx 50, a benchmark for nations sharing the euro, gained 3.8 per cent.
The ECB will announce its rate decision on April 10. The ECB left its key rate at a six-year high of four per cent last meeting to curb inflation, which accelerated to 3.5 per cent in March, the fastest pace in almost 16 years. The BOE will announce on April 10 any change to interest rates in the U.K.
“Economic decisions and data will be significant next week,” said Keith Bowman, an analyst at Hargreaves Lansdown Plc in Bristol, England. “A growing number of economists believe that the ECB will eventually be forced to cut rates in order to head off a slowdown in economic activity.”
The ECB will keep interest rates unchanged, according to a group of economists surveyed by Bloomberg. In the U.K. interest rates will be cut by 25 basis points to five per cent, according to a Bloomberg survey of economists.
Signet will announce net income of $212.2 million on April 9, according a Bloomberg survey of six analysts.
“Key issues going forward are the success of repricing initiatives in the U.S.,” London-based UBS AG analyst Andrew Hughes wrote in a note to clients last Friday.
Banco Espanol de Credito SA, a retail unit Banco Santander SA, also known as Banesto, will announce earnings on April 9. Full-year net income will be 858 million euros ($1.35 billion), according to a Bloomberg survey of 22 analysts.
Updates of traffic figures from the airline industry will also be expected next week. Deutsche Lufthansa AG, Europe’s second-largest airline, will announce its March traffic volumes on April 9 and EasyJet Plc, Europe’s second-biggest discount airline, will provide this information on April 7.
European markets will also focus on the minutes from the U.S. Federal Open Market Committee’s March meeting when it cut the benchmark interest rate to 2.25 per cent and said the “outlook for economic activity has weakened further.”

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8 Rules to Trade the US Market to Perfection Friday, Mar 28 2008

People often ask questions about short term trading.  They want to know all about day trading, and they are also curious about “swing trading”, which is defined by Investopedia.com as holding an investment position from one to four days.  The most common questions are:

How do you get started?  How do you know what to trade?  Can you really make money at it?  Is short term trading very risky?   Do you know anyone who actually does it for a living?

The prospect of maybe quitting one’s day job in order to trade for a living is a fantasy that many people have, but few ever realize.   Some tried it during the late 1990’s, did well for awhile, but then lost their shirts in the 2000-2002 tech melt down.  Others daydream about maybe trying it one day in retirement, but they worry about losing their savings, and not being able to replace those funds at an advanced age.

This is the story of Ben, a trader who thus far has successfully turned his retirement dream into reality.  He has been swing trading for several months now, and recently began to specialize in trading the Ultrashort QQQ Pro Shares, (symbol QID), which is the exchange traded fund, or ETF, that double shorts the NASDAQ 100.  The QID is extremely volatile, because it moves twice as much, and in the opposite direction, from the NASDAQ 100.  On a day when the NASDAQ 100 falls 2%, the QID will be up about 4%.  When the NASDAQ 100 is up 1%, QID will be down about 2%.

Ben lives in New York City.  He is in his upper 50’s now, and had worked in the commercial collections industry for over 30 years.  Ben is a hard driving guy and usually excels at whatever he attempts.  He has a keen ability to analyze things correctly, and the courage to act confidently when he knows he can master something.  I personally have known Ben for about 20 years, so when he tells me that he’s on to something big, I listen.

Ben has owned stocks and mutual funds for a very long time.  He is a better than average trader when he buys or sells individual stocks.  But when it comes to trading the QID, Ben may have no equal!  In fact, I now call him “The King of the QID”!  What is the reason for his grandiose title?

Over the past 36 closed QID trades, Ben has made a profit 36 out of 36 times!!!

That’s right, a perfect 100% batting average!

Skeptical?  Sounds like hogwash, doesn’t it?  But Ben has the documents to prove it.  And I have been in daily contact with him since he began trading the QID, and have followed his results.

After Ben told me about his perfect record, two inspirational ideas came into my mind.  The first is that we could create one of those “Make huge profits!” type web sites and charge a lot of money for revealing this method.  The second was that I could simply detail Ben’s method for “The Tycoon Report” readers for free.

I am choosing to go with my second idea, because personally I hate those dopey “get rich quick” web sites, and because using this method can make us just as much money.

But before I share with you the details of how the “King of the QID” has traded a perfect 36 for 36, I want to make sure that I offer you this caveat:

1)    Day trading and even swing trading can be very risky.  Only use money you can afford to lose.  Do not ever use the mortgage, utilities, or food money!
2)    Do not day or swing trade until and unless you have no debt (other than a mortgage), have a fully funded 401k or IRA, and you have a 3-6 month emergency fund in a bank or money market.
3)    Any method, including this one, should be tried ON PAPER for a couple of weeks before you risk one dime of real money.
4)    Never trade when you are sick, upset, or distracted by other things going on around you.
5)    Never risk more than 5% of your total capital on any one trade.
6)    Always know your exit price in advance, whether on a gain or loss and stick to it.
7)    Just because it worked well for this one investor, doesn’t mean it is guaranteed to work well for anyone else.  Your performance may be better or worse than his. 

Ok, enough of the hedging, let’s get to it.  I recently interviewed Ben to learn how he trades the QID so successfully.  This is the interview that took place:

Ben, what is the length of time that you have been trading the QID?

I have been trading the QID for 2 months.

What is your total profit so far?

My total profit is $15,582, based on 36 trades.

How much is the average profit per trade?

After commissions, but before taxes, the average profit per trade is $416.83

How much in commission do you pay?

I pay $8 per trade.

What is your profit versus loss record on the 36 closed trades?

I have 36 winning, closed trades, I’m still undefeated.  I am currently holding two other buys.

What is the average time that you hold a position?

The Average time QID is held is a little over two days.

What is the most and the least you ever invested in a QID trade?

The highest amount invested in one trade was $45,200. The lowest amount invested in one trade was $6200.  The average amount invested each time is about $9000.

What is your philosophy about trading the QID?  How do you start the day?

I feel on the average the QID fluctuates 1.50- 2.50 per day. I look closely at the futures in the morning to get a gauge of what I perceive the opening to be. In addition, I look at the business news of the day.  I look at pre market trading, volume, and prices relative to where it closed the night before.  On occasion, I have bought in the pre market at what I feel is a good price and done well, at other times the opening price has been lower than pre market trades.

If I have not bought in the pre market, I rarely put in a buy for the opening. I like to see how patterns develop for the first 15 minutes of trading.  Then I gauge the highs and lows over the course of the first 60-90 minutes and follow closely the activity of the NASDAQ, which QID tracks inversely.  On many recent occasions, I have put in a buy order, when the price was 54.00 or higher, for a lower price as I see the NASDAQ moving up. I don’t chase a price, for as we well know the market rarely goes straight up or down.  Over the course of a trading day, the Dow and NASDAQ can vary as much as 3% on the up or down side.

To what do you attribute your success?

I feel the success I have been achieving is by following the NASDAQ and when contemplating a buy, constantly checking for a rapid update of the QID price, trying to get the best price.

Conversely, when selling (which I still want to improve), my success is the amount of profit attained. I strive to buy and sell in one day. However, I am not averse to holding, in some cases up to two weeks, to realize a profit. That was more the case when I initially started trading and I wasn’t as cognizant of the market volatility.

Do you use any technical indicators when you trade?

I have only used the RSI so far.

Do you use market orders or limit orders?

I use 100% limit orders.

Do you ever use stop loss or stop limit orders?

No.  If the market goes higher for a few days, intraday there are opportunities.  However, if the market really started heading upstream, at the slightest pullback before the next surge, I would sell for a loss.  Also, if I felt that a bull market was in the making, I would hedge by going long on another ETF, as I did last week by buying UYG (Ultra Financial Pro Shares ETF).

What is your goal for trading the QID?

My goal is to realize 5% or more of my investment, per trade. However I have profited as little as $58 (after commissions) if I feel the trading day is stale from the view point of upside and downside.

What was your greatest profit?

My greatest profit in one order was $1875, achieved as I was holding 500 shares at 50.70. There was dramatic bad news that morning.  I don’t recall what specifically, and the market was going to open significantly lower. I put in a sell order, and was rewarded with a sell of 500 at $54.45 for an $1875 profit, achieved overnight!

It would be easy to say that your recent success trading the QID is largely due to the fact that we’ve had a bear market.  If the market turns around tomorrow, will you switch to one of the ETF’s that is long the NASDAQ, such as QQQQ or QLD?  And how long would you wait, or perhaps even lose money on a QID position, before you did that?

I would not hesitate to go long on an ETF in a given day, whether it is a sector ETF, or a more generic one such as the QQQQ, or QLD.  However, even on a positive day as the market had on March 11th, I bought 700 shares of QID at 55.22, and sold at 55.71 for a $343 profit.  Intraday trade is where I feel the best opportunities lie.  Knowledgeable after two months of trading the QID, I strive not to expose myself to buying when the price is over $56, in case there is a market turnaround.

So Ben’s trading method can be summarized as follows:

1)  Study the pre-market news, as well as the QID price and volume, to determine the most probable direction for the NASDAQ market that day
2)  Do not buy on a market order at the opening, but instead put in a limit order for a lower price or wait for a lower move by the QID, before initiating an order.
3)  Never chase a price- instead, wait for the market to come back to you.
4)  Continuously monitor the price throughout the first part of the trading day.
5)  Seek a profit objective of 5 percent or more on each trade.  On a $9000 average trade, the objective would be a minimum gain of $450.
6)  Be willing to hold onto the QID position for as little as a few hours to a maximum of two weeks in order to achieve your desired profit.
7)  Sell when you feel the QID has either achieved your objective or if the market seems to lack the impetus to propel the price further in your favor.
8)  Be flexible to close out your position quickly if the market conditions change.

Ben’s method is certainly not as complex as many of the trading systems that people use, and may even seem simplistic to some.   Although the basic premises are sound, it is not what one would call “scientific”.  Yet one thing that he does very well is to maintain his cool when the direction of the trade is going against him.  He is patient because he has learned that eventually the QID will swing back in his direction.  It may be that day, or it may take a few days.  But either way, he does not panic and sell prematurely at a loss, as many traders do.  He has studied the parameters of what he is trading, and knows the daily highs and lows, as well as the average price range.

This knowledge helps him to make better determinations of when to buy and when to sell.  His focus on one primary ETF allows him to know all of its nuances, its rhythms, and its behavior.  Like a parent who instinctively knows when their child is well or sick, he can read the temperature of the QID, and act accordingly.

Yes, Ben’s trading method is simple.  It is the simplicity of his method, and his ability to stick to a working system without deviations, that have created the perfect results so far.  Too many traders find something that works, but then go off on tangents that kill their previous results.  He is not a professional trader, and he doesn’t trade hundreds of thousands of dollars a day.  He is just a regular guy who has discovered a method that works very well for him, and he is enjoying the returns he gets on his way to living his retirement dream.  He makes sure that he only trades with money he can afford to lose, yet paradoxically so far he hasn’t had lost any of it!

So if you are struggling to improve your current short term trading results, or are thinking about trying some short term trading, no matter what particular stock or ETF that you would like to trade, consider using some or all of the principles that have earned Ben the title of “King of the QID”!

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Welcome to Wealth Management Club Thursday, Mar 13 2008

Mention the terms ‘private bank’ or ‘wealth management’ and the image of a Gucci-clad high-flier speaking to their personal banker on their mobile from a private yacht might spring to mind.

While this may not be far from the truth for some of the most elite private banks and wealth management firms, such services are no longer the exclusive domain of the rich. With many consumers disillusioned by the state pension system or their work pension scheme, uncertain where to deposit their savings after the Northern Rock saga or just sick of poor service from their high street bank, more than ever before are turning to wealth management firms.

But wealth management and private banking can be a complex area and is not a suitable alternative for everyone. So, how do you know if these services – and the higher costs they can demand – are right for you?

What are they?

Wealth management and private banking services offer similar services. Private banks typically offer traditional banking services along with a tailored approach to looking after your finances that encompasses wealth management. They sell themselves on exclusivity and personal service.

Wealth management itself has no simple definition, as it means different things to different people. Put simply, it is the concept of helping an individual to manage their wealth to get the best out of it.

“At its most basic, wealth management is looking at how you manage wealth for a longer period,” says Bruce Weatherill, global private banking and wealth management leader at PricewaterhouseCoopers. “It’s actually managing wealth effectively from birth to death and through death to the next generation,” he says. Firms with a banking licence – generally the private banks, although specialist wealth managers have one too – offer everything vailable from a high street bank, but with access to a wider range of services and expertise and with more bells and whistles.

Beyond banking services, private banks and wealth management services provide services ranging from basic financial advice and planning to complete management of a customer’s financial affairs. They can offer retirement planning and pension services, advice on trusts and tax planning, oversight of insurance needs and investment opportunities that clients may struggle to grasp on their own. While not all firms offer all these services in-house, many will find the expertise for you.

However, services on offer from a firm operating under the wealth management banner can vary significantly, as Patrick Connolly, certified financial planner at Towry Law, explains. “There are many different firms, with different propositions, that purport to offer wealth management services,” he says.

Connolly says wealth management used to be offered almost exclusively by private banks and discretionary fund managers – which will manage your investments entirely, including taking investment decisions on your behalf.

“Today wealth management services could be offered by a private bank, stockbroker, fee-based financial planner or commission-based financial adviser. Indeed a one-man band sitting in his shed can claim to offer wealth management services.”

Research firm ComPeer’s UK Wealth Management Industry Report 2007 suggests growing numbers of firms are keen to get a slice of the wealth management pie, with IFAs increasingly branding themselves as such and life and pensions companies establishing wealth management divisions. ComPeer’s definition of wealth management has typically been those firms regulated to manage or administer a client’s money on their behalf.

Simon Pimblett, head of research and development at Route Group, a wealth management service aimed at high-earning City workers, suggests that, while specialist wealth managers tend to be independent free agents looking across the whole market, “banks tend to promote whatever they themselves are putting together”.

However, Weatherill believes this is changing, with ‘open architecture’ structures where banks offer a wider array of outside products.

Is it for you?

There is no doubt that the more money you have to invest, the better. While the big international private banks look for minimum investable assets between £5 million and £10 million, UK private banks are keen to appeal to a wider market and therefore may look to a minimum of £250,000 to £500,000.

Investable assets refers to the likes of funds in your pension pot, savings and ISAs, and stocks and shares, but not your main home.

But it’s not all bad news if you don’t have £250,000 lying around – you can access such services at much lower levels. Efforts have been made, particularly by high street banks, to offer services targeted at the “mass affluent”.

With around £50,000 you can get premier services with HSBC, while as little as £5,000 will get you through the door for the private banking services of Cater Allen, part of Santander Private Banking UK.

Brian Capon, head of media relations at the British Bankers’ Association, says consumers, particularly those with savings, are increasingly using add-on services to make more of their money. “More traditionally they might have relied on a state pension plus something else put into a building society or something like that,” he says.

“But I think people are much more aware now that they need to make that money work for them and that it may mean paying out to get that expertise. “

Capon suggests there is a form of wealth management service or advice available for everyone, but believes the real benefits kick in when an individual has upwards of £50,000.

He says most banks will offer wealth management services of some kind – whether it be an add-on service provided by a high street bank or its private banking arm, or a private bank such as Coutts & Co, the private banking arm of the Royal Bank of Scotland Group.

On top of this, wealth management can also be provided by specialist firms, such as the Route Group, along with some IFAs, such as Towry Law, while some stockbroking firms also offer these services.

PwC’s Weatherill, however, suggests it is at the £250,000 mark that the services of wealth management firms and private banks come into their own. “When you have more than that you actually have different options,” he says.

James Thorpe, a spokesman for HSBC, describes private banking as “the top of the tree” when it comes to wealth management. People require around £2.5 million to £3 million of investable assets before they become eligible for HSBC’s private banking service. However, the bank does offer special services for those with considerably less to invest. As a guideline, customers with £50,000 or more to invest, or a salary of about £75,000 with a mortgage in the region of £250,000, would typically qualify for HSBC’s premier service. Thorpe says this service is particularly useful for those who spend a lot of time abroad and need to be able to move their banking services with them.

Premier customers with more than £100,000 have access to advice from IFAs that consider products from the whole of the market. Meanwhile, those with less would have access to HSBC’s financial planning managers, who are tied to HSBC, although they do have access to around six different fund managers.

Thorpe points to groups such as Britons living abroad, those who inherit, or anyone feeling the benefits of the house price boom as potential customers of its premier service. He says many people are not aware that services like these might be open to them. “They don’t really consider themselves wealthy – they’re self-made individuals,” Thorpe says.

Costs

The cost of private banks and wealth management services varies depending on the services used and the firm offering them.

Bruce Weatherill says the typical charge on assets under a firm’s management is around 1% a year, with various transaction costs on top.

“At much less than £200,000 it’s a little difficult, but above that you can get various tiered rates. The more money you have the cheaper it becomes,” he says.

But do they add any real value? Weatherill illustrates the benefits of a private bank or wealth manager with the analogy of taking your car to the garage, only to have the mechanic talk you through the inner workings of the carburettor, rather than just fixing it.

“They offer it all in one package. So rather than going wherever you would go for your various services, they offer it to you all in one,” he says.

Todd Davis, head of finance intelligence at research firm Mintel, says wealth managers can really add value for clients in providing “frontline informed advice” that is reflected in investment returns. “They’re very good in terms of maintaining a client and developing client loyalties and doing annual or biannual reviews where you collect every scrap of information on a client’s financial situation and provide them with detailed advice on estate planning, tax and investment planning,” he says.

“This is expensive advice, but you could employ your solicitor and accountant to do a great many hours of work, while a private bank can try and offer that advice a little more efficiently and cheaply.”

Others suggest it is the higher level of service – the personalised approach with a dedicated contact, along with, where applicable, having your money backed by a reputable global organisation – that makes private banking or wealth management worthwhile.

David Elms, chief executive of IFA Promotion, says: “You have to shop around. I think you have to look at corporate wealth managers’ offerings; you have to look at IFA offerings; you have to look at accountancy offerings and you have to pick which services are going to provide the best service for your particular needs.”

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