Dividend Capture is a type of investment strategy for an investor whereby the investor buys the stock let say before two weeks it goes ex-dividend sell them after two week when it has gone pass the ex-dividend in this transaction, he tries to get a small benefits on his trades. On the ex-dividend date, if its price drop below the price of the dividend. This theory is works on the assumption that price will works is way and tend to go back up to the price it was earlier or before the ex-dividend date. Due to this an investor is able to sell slightly above the purchase price. Like this an investor or share holder can make some profit the four weeks time.

It is a method of converting gains into dividends it also has tax advantages and more interest but it does not mean it produces a large, stable, growing income. The key of Dividend capture is to purchase a stock just before the special dividend. If sold 61 days later, the special dividend appears as dividend income and, to a first approximation, but it may lead to a short term capital loss as well if purchases are limited to companies worth owning in the first place, it is not necessary to realize the loss immediately. Rather, the stock can be held until needed for another dividend capture. You would sell only when a more desirable stock becomes available. Due to this a stock tends to move between the two portions as their prospects change.

Dividends, whether regular or special, are tied to business conditions not to the stock prices. Stock prices tend to rise and fall together, especially in the short run. A minimal amount of dividend capture is needed to provide a high income stream. The dollar amount of special dividends captured is important. A first approximation, picking up a dividend dollar amount will required to have certain number of share not a dollar amount of share. When shares sold to dividend capture new special dividends go behind the overall market price. The income stream heavily depends on the number of shares purchased not on the price per share. Comparing captured dividend what regular dividends one can say that Regular dividends are not stable because the individual price fluctuations do not back the market perfectly rather income from captured dividends is stable.

Dividend capture strategies are becoming more and more popular among those speculators who do not like get exposed to the market risk but also wanted to take some money with them without any risk. The main concern is that those investors who have very short mindset and trying to take advantage of capture is the strategy. they are always on the risk of exposing themselves to the market fluctuations .such a strategy can be profitable during bull markets. as in such market the stock price in general increase. which will help lift the speculators in taking position at the profit ; but in the beer market the risk of getting into the big wave is much higher due to volatility of the market .

Home Refinancing

The term home refinancing means seeking a second or additional home loan to replace an existing loan by mortgaging the same asset, which is usually a home for a place, which can be used as a mortgage. Although it seems that home refinancing is the consumer oriented and beneficiary for the customer, who take such loan but it also has some risk. First of all we will talk about the advantages of home refinancing, this lead to a change in the interest-rate, as the Interstate of home refinancing may be less than the earlier one. Second benefit can be gaining and additional amount of money and winning an extension of period for repayment and, also to have provisions to pay off the other existing debt. It lowers the risk of liquidation of an equity that has accumulated during the ownership of the home etc.

Many people are attracted towards home refinancing, just because of the chance of being less monthly installment of repayment. This is done either by changing the loan repayment conditions of the loan to a lower interest rate or by increasing the repayment period of the mortgage loan. The Home Equity can also be used to get more money through a home refinancing to buy a second home, or to pay off debts, to meet the expense of education, to overcome the medical treatment expenses etc.

We have already talked about various advantages of home refinancing rates. It’s time to talk about some risk in taking such finance. Sometimes you might have took a penalty fees and histories may be higher than the saving you could generate from home refinancing, when someone take different loans they might be Charlie some penalties in such a case you might face some losses and these losses may be much higher than the saving you could generate from home refinancing, it is better not to take such a loan.

Sometime getting a new home refinancing loan bring such difficult circumstances which involves higher possible is to than the previous home loan the second home loan may call for unseen this factor which ultimately create mental torments and monetary losses and may bring some situations that became very difficult to handle. There are few points which have to be kept in mind while going for home refinancing.

You must know prepayment fees and penalties some time when you want to pay your loan before the period the bank may charge you some fees and penalties just to make up their losses. Refinance Your Home loan for Reduce Interest Rates only if it makes financial benefits. You must first ensure that there is no error in your financial statements. Checking your credit reports to be sure you can find no errors. If you will find errors, fix them prior to you secure a house refinance mortgage answer. You do not want to get surprises on the credit report to make an impact on your ability to have the best rate on your house refinance.

How to calculate dividends

when a company made payment in cash or in stock to the shareholder of the company, this is called dividend usually dividend is declared by the authorized board of directors, if we are talking about preferred stock, in this case the dividend is paid at a fixed and guaranteed rate. Generally an investor used to calculate dividend yield and payout ratio after analyzing stocks performance in the market. For those investors who are interested in investments which can produce income only, for such investor’s main concern is dividend. But for those investors who were interested in only in equity growth they gave less importance to dividends.

For analyzing a company’s dividends it is very important to find out how much income the dividend present, because it very necessary to multiply dividend amount per share to the number of share, dividend are paid on quarterly basis. To find out what income will be paid every three months we have two divides it back for. For example John have a 100 shares in these share he get dividend of $2 per share, so annual income will be 800 times $2 which is $1600 now to get what we will get after three months we have divided by four and we get$400. This is how the dividend is calculated it for three months. Now as we have torn about yield and payout ratio there is understand what yield and payout ratio is. To figure out is yield will just have to divide the amount of dividend by the price paid for per share of the Stock. For instance, if this talk was purchased for $ 25 per share and the dividend is $ 2 per share to come up the figure of yield divided dollar 2 by dollar 25 you will get 8%. Dividend yield is it can be useful when we compare the income potential with the other securities like Bond or CDs.

The dividend payout ratio is the ratio of how much profit is paid in the form of dividend in compare of the company’s profit. To find out the payout ratio denied the earning per share by the dividend to get on per share, let’s say if earning per share is $2/50 and dividend is $0.50, in this case the dividend payout would be 5:1. A high payout ratio shows that the companies keeping most of its profit, while a low payout ratio shows that the dividend is being paid in good ratio.

Sometimes a completion additional share to its stockholders instead of paying cash dividend, such a method of paying share in instead of cash gave a company a position to keep cash to reinvest because stock may appreciate and depends on the market due to the chances of a stock goes to a higher price it’s a good deal for the investor a company might issue 4% stock dividend for example a shareholder can be given 4 extra stock for every hundred share owned. Now in order to find out the worthiness of the share, you need to multiply the number of share by market price of the share. Let’s say if the stock is selling for $25 per share, that 4% dividend would be 4% of $25 or $1 per share.

How much can I borrow for a mortgage?

when someone decide to opt for a mortgage he always has some plans regarding how much she need to borrow, and his capacity to repay the mortgage loan because nobody would like to lose their house property to foreclosure, second thing he would consider about the interest rate if the interest rates are low he would consider taking mortgage loan according to his requirement, but if interested are too high then he would probably think to adjust the requirements accordingly. When it comes to lenders or banks before deciding upon the limit of the mortgage loan they will probably look into the financial background of the borrower, about lease capacity to repay the loan on time because bank would not like to lose their money to people recklessly who will not be able to repay the mortgage amount on time therefore they have several ratios before determined how much money they can live to the borrower.

Cost of mortgage

when someone decides to buy a house, there are several payments is responsible to pay on time like home owners insurance, property tax, real estate tax, when these are all added to the mortgage payment all these costs when added. they usually give the exact cost of the mortgage. And bank N this to your anticipated monthly expenses.

Private mortgage insurance

Private mortgage insurance is also PMI; sometime borrower is not able to afford 20% of the homes price which usually paid as a down payment in such a case the borrower would require to buy private mortgage insurance just to cover up the bank’s investments.

Front-End ratio

The front and ratio is the comparison between the monthly mortgage costs-which includes insurance, real estate taxes, private monthly insurance with your total monthly income. Generally mortgage costs are given to make up between 26% to 29% of your monthly income, in this case your monthly maximum repayment amount would be $840.

Back-end ratio

when your total income is compared with the your total debt payments this is called back end ratio, such ratio includes credit card debt and college loans, and any other debt you have. It can make a total of up to 33 to 40% of your income. For example, if your bank 35% as the limit, and you has a monthly income of $3000, in this case your total dad played with a month would be $1,050. If we had to pay $400 as a monthly student loan, you would then have a maximum of $650 left in your income which can be used to repay the mortgage loan.

Credit score

If you have a good credit risk of the bank are likely to increase the limit of the ratio for you because, your financial history of repaying the credit on time, build banks faith in your credibility and they are willing to increase the limit of ratio, So all these characteristics of mortgage helps the borrower and lenders in deciding how much they can borrow or how much the lender can lend money.