Acacia Technologies Licenses Credit Card Fraud Protection Technology to Jones Apparel Group

NEWPORT BEACH, Calif.--(BUSINESS WIRE)--Acacia Research Corporation (Nasdaq:ACTG)(Nasdaq:CBMX) announced today
that Financial Systems Innovation LLC, a wholly owned subsidiary of the
Acacia Technologies group, a leader in technology licensing, has entered
into non-exclusive licenses covering a patent that applies to credit
card fraud protection technology with Jones Apparel Group.

The patented technology generally relates to a computerized system for
protecting retailers and consumers engaged in credit card, check card,
and debit transactions. The system includes an electronic card reader,
and the generation and use of a transaction number, which specifically
identifies each transaction processed within the system. As a result,
the retailer does not necessarily have to print detailed information
concerning the cardholder’s identity or
account number on the customer’s receipt.

ABOUT ACACIA RESEARCH CORPORATION

Acacia Research Corporation comprises two operating groups, Acacia
Technologies group and CombiMatrix group.

The Acacia Technologies group develops, acquires, and licenses patented
technologies. Acacia controls 68 patent portfolios covering technologies
used in a wide variety of industries including audio/video enhancement &
synchronization, broadcast data retrieval, computer memory cache
coherency, credit card fraud protection, database management, data
encryption & product activation, digital media transmission (DMT®),
digital video production, dynamic manufacturing modeling, enhanced
Internet navigation, image resolution enhancement, interactive data
sharing, interactive television, laptop docking station connectivity,
microprocessor enhancement, multi-dimensional bar codes, resource
scheduling, spreadsheet automation, and user activated Internet
advertising.

The CombiMatrix group is developing a platform technology to rapidly
produce customizable arrays, which are semiconductor-based tools for use
in identifying and determining the roles of genes, gene mutations and
proteins. The CombiMatrix group's technology has a wide range of
potential applications in the areas of genomics, proteomics, biosensors,
drug discovery, drug development, diagnostics, combinatorial chemistry,
material sciences and nanotechnology.

Acacia Research-Acacia Technologies (Nasdaq:ACTG) and Acacia
Research-CombiMatrix (Nasdaq:CBMX) are both classes of common stock
issued by Acacia Research Corporation and are intended to reflect the
performance of the respective operating groups and are not issued by the
operating groups.

Information about the Acacia Technologies group and the CombiMatrix
group is available at .

Safe Harbor Statement under the Private Securities Litigation
Reform Act of 1995

This news release contains forward-looking statements within the
meaning of the “safe harbor”
provisions of the Private Securities Litigation Reform Act of 1995. These
statements are based upon our current expectations and speak only as of
the date hereof. Our actual results may differ materially and
adversely from those expressed in any forward-looking statements as a
result of various factors and uncertainties, including the recent
economic slowdown affecting technology companies, our ability to
successfully develop products, rapid technological change in our
markets, changes in demand for our future products, legislative,
regulatory and competitive developments and general economic conditions.
Our Annual Report on Form 10-K, recent and forthcoming Quarterly
Reports on Form 10-Q, recent Current Reports on Forms 8-K and 8-K/A, and
other SEC filings discuss some of the important risk factors that may
affect our business, results of operations and financial condition. We
undertake no obligation to revise or update publicly any forward-looking
statements for any reason.

How is Your FICO Score Determined?

Perhaps you're familiar with the FICO scoring system used by credit companies to determine a possible client's creditworthiness. But make you cognize how that score is determined?

First, let's define the acronym FICO. It is used to depict a system developed by the Carnival Isaac Company for one of the Big Three credit reporting companies, Experian. Since its inception, FICO have gone on to go the criterion within the credit industry for determining the creditworthiness of possible borrowers. It dwells of a series of questions, and replies are given a certain number of points. When they're all added up, that number stands for your FICO score. (All the information in your credit report is considered, of course, but FICO also analyzes more than than twenty factors, divided into five chief categories.)

The first class sees your payment history, and stands for 35 percent of your score. The factor carrying the most weight is the seasonableness of your payments, with accent placed on your most recent bills. Paying all your measures on clip will raise your FICO score. The more than late payments you've made, the lower your score will be. If your accounts have got been turned over to aggregation agencies, that aches even more, and if you've declared bankruptcy, that volition earn you the lowest FICO score.

FICO topographic points a 30 percent accent on the amount of money you owe and your available credit. It also inquires about your outstanding debt, such as as your mortgage, credit cards, and auto loans. FICO also inquires the sum amount of credit you have got at your disposal. For instance, if you have got five credit cards, each with a $2,000 limit, that amounts to $10,000 of available credit. Consumers who have got got access to a important amount of credit have a inclination to utilize it, which can do them a greater credit hazard overall. If your cards are close to the upper limit already, that brands you an even less attractive risk. The people who obtain the highest FICO score in this class are those who utilize their credit prudently and keep relatively low balances.

Some 15 percent of your FICO score come ups from the length of your credit history. Simply put: the longer you've been using your credit, especially if it's been with the same companies, the higher your FICO score will be.

FICO sets a 10 percent value on the overall premix of your credit. The more than types of loans you've had, the better, as far as your FICO score. If you've had car loans, credit card payments, assorted types of installment loans, and a mortgage, you'll have a higher FICO score.

Your FICO score also gives you a 10 percent insurance premium if you've sought new credit within the past year. FICO gives points for clients that are savvy adequate to shop around for better interest rates for home or car loans from clip to time. However, you get tax deductions if you apply for credit to many times.

Your FICO score can determine the percentage rate of your car or home loan, and may even get you a lower rate on your credit cards. It's a number that's worth knowing. However, don't pay for your FICO score. The numbers you get from a paid service are NOT the same FICO scores your existent estate lender gets. If you desire to cognize your FICO, inquire a loan officer.

Copyright © Jeanette J. Fisher

Credit Report - How to Improve Your Credit Score

One of the great enigmas of life is how the three major credit bureaus (Experian, Equifax, and Trans Union) score credit. They all have got secret statistical expressions for determining your credit score, but they are unwilling to divulge exactly what, exactly, represents your score. This tin make it hard for people with problem credit to seek to better their score in hopes of obtaining a home or car loan later.

While the exact expression is a secret, there are a few things you can do that volition undoubtedly better your score:

Pay off a home equity line of credit. These loans, which allow you to borrow more than than once against your home’s equity, are considered rotating credit, much like a credit card. Wage it down or pay it off; either should assist your score.

Check your credit report regularly; you are entitled to a free transcript of your credit report once a year. By looking over your credit report, you can do certain that debts you have got got paid on clip are shown on the report, such as as student loans, or auto loans that have been paid in full. You can also do certain that your credit bounds on your credit cards are reported correctly. Lenders expression at the ratio of debt to available credit, and if your reported credit bounds is low, it could do it look as though you are nearly at your credit limit.

Check for reduplicate information on your credit report. If your mortgage have been sold to another firm, do certain that your report doesn’t show your mortgage twice.

Keep balances on credit cards and other rotating accounts low. You make not desire to be seen owing too much money to too many different lenders.

Don’t have got too many unfastened credit accounts. Ten Visa cards will not assist your credit rating. Try to maintain a upper limit of three rotating credit accounts.

By checking your credit report regularly, and by eliminating unusual entries, you should be able to increase your credit score. And with credit, every small spot helps.

Would An Elected Official's Credit Score Affect Your Vote?

Bad credit can go on to good people. Often all it takes is a financial trip here or medical emergency there and the average American could easily do a late payment, lose a payment, or autumn behind all together on their bills. While there is usually a alone personal story, and often a very good reason, rarely are individual fortune a factor when your credit score is calculated.

Now more than than ever it's important for people to cognize their credit scores; but apparently private citizens aren't the lone 1s who need to cognize the three figure score that's go the "grade" you're given based on your on-going financial behavior.

Recently a very gutsy newspaper in Toledo, Buckeye State challenged both Republican and Democrat City Advocate campaigners to "show their cards," by giving access to their credit reports and credit scores for the ballot populace to see.

This raises a very interesting question; would an elective official's credit score affect your vote?

I began to believe about the possible case in point that this challenge would put if all political campaigners were asked to "come clean" with this information. Sure we’re used to seeing their tax tax returns and knowing how much they make, but somehow this looks different, bigger, and more than profound.

Credit scores are used by respective groupings to determine financial patterns, wonts and in some cases even your character. They’re also used to foretell the likeliness of your repeating these patterns in the future.

In general credit scores range from 300 (low) to 850 (very high) and everywhere in between. There is still some enigma around how a score is calculated and what factors are involved. One thing is for sure, this is a number you need to cognize and watch. Everyone from your current creditors to your car insurance company are checking it periodically to see where you "rank," a low score could ensue in rate increases.

It's obvious that as people we're "deemed worthy" (creditworthy that is) by our credit score on a regular bases. Should the same criteria be applied to those we take to run our cities, states and even this country?

To get a broader position on this Pandora's boxlike inquiry I did a spot of research on the overall impact of credit reports and credit scores on an people life and came to learn that, according to a Federal Soldier Trade Committee Consumer Alert, "Employers often utilize a credit report when they engage and measure employees for promotion, reassignment or retention."

While to some it might look partial or like "big brother" is watching just a small to close, often this pattern is widely justified, especially in the aftermath of Enron, corporate dirts and 9-11. Employers are learning that they can state a batch about a occupation campaigner and their chance to be a quality employee by their credit report and credit score.

Credit scores have got the powerfulness to be the Varsity missive you have on proudly on your jacket or the Scarlet Letter you have on shamefully on your chest. Given the weight it have on so many facets of an people life, is it just or even necessary to necessitate political campaigners to let on theirs?

The inquiry will no doubt be debated at H2O coolers, and in bars, dining rooms, even political campaign warfare suite all throughout the city of Toledo. I'm in New Jersey (where respective campaigners are running in heated up battles as I compose this) and I’ll be just as intrigued to learn if this fizzles out, or catches fire as a new trend.

It looks to me that the existent inquiry electors in Toledo (and soon maybe everywhere) have got to inquire themselves will be, "Is a credit score (determined by a complex expression that no 1 looks to quite understand and that doesn't take individual fortune into consideration) really a good barometer for a political campaigners ability to lead or make the job?"

Maybe. Maybe not. But before you constitute your opinion, I inquire for you to ask yourself a question. Given your personal financial situation, past or present, how many ballots would be cast of characters in your favour if your credit report was used to judge your fictional character or ability to make the job?

5 Tips to Improve Your Credit Score

Boosting your credit score can salvage you money. Your credit score is a number based on how well you pay back loans on time, sometimes called a FICO score. The higher the score, the less risky you are. The 3 participants are Experian, Equifax and TransUnion.

Your end is to get above 620. That’s the line for creditors. If you are below 600, banks won’t loan you money. In fact, if your ma knew your credit score was that low, she wouldn’t allow you borrow any money, either. If you can get the score above 700, you get low rates. If you can eek out above 760, you can usually get the lowest rates. Perfective score is 850. Average score is 723.

Under the Carnival and Accurate Credit Transactions Act, you can obtain one annual free transcript of your credit report. For more than information visit www.annualcreditreport.com Oregon phone call 877-322-8228. But you will still have got to pay a fee to get your existent score. Huh? They’ll give you your credit history, but the existent number, well, they can charge you $6 for.

Here’s the deal. You can get one free credit report (no credit score number) from each of the 3 reporting agencies listed above. But, you can only make this once a year. So, I spaced my petitions out every 4 calendar months instead of getting all 3 at once. That manner I can observe changes. Just an idea.

Without additional ado, here are the top 5 tips for improving your credit score:

1. Wage your measures on time. If you pay late, then your measure shows up in a particular country called “Adverse Accounts” and it names what calendar month you were late and how late you were. Think its OK, it only happened 3 old age ago. .wrong. They maintain the listing for 7 years. Yes, seven. Paying your measures on clip can raise your score as much as 20 points just in one month.
2. Keep you credit card balances low. Maxing out your credit cards can lower your credit score by 70 points.
3. Don’t unfastened any credit cards you don’t need. New accounts lower your credit score by an average of 10 points.
4. Rich Person credit cards. Yes, you must have got an installment type loan and its OK. Just pay it on time. If you have got no credit cards or no installment loans, you be given to be a higher risk.
5. Closed accounts don’t travel away. Believe me. Iodine just checked my credit report and some old material is still on there. Real Number old stuff.

Hope this information helped you get your measures in order.

Why Does Your Credit Card Rate Keep Going Up?

Have your read your credit card contract through completely? Bash you cognize when it is all right for your creditor to raise your interest rates? If you are not certain about how and when your rates can be affected over the life of your contract you should take a few proceedings to read your contract thoroughly from beginning to end.

Creditors must have got clauses in their contracts that give them the right to change your interest rates. And if your rates have got got gone up you can be pretty certain that they are there, you may have missed them on your first read through but they are there buried in the contract.

If even after reading your contract again you still cannot figure out just how your credit card issuer can make this to you inquire yourself the following questions.

Have you been late paying your monthly credit card payment recently? If you have, your interest rate going up is most likely owed to this factor. Whenever you are late making a payment the credit card company have the right to raise your interest rates.

Have you been late on any other debt payments? Any late payments can cause your interest rates to rise, even 1s that are not associated with your credit card. Your creditors have got access to your credit report and all payments that you make are on there, if they see you made a late payment to person else it can get them concerned that you will do the same to them in the future. That is why it is so of import to always do your payments on clip every single month.

Has your credit card company merged with another company? Mergers can impact your contract. The acquiring company have the right to change the regulations on you as long as they allow you cognize what is going on and why.

It is astonishing what credit card companies can get away with legally. All you can do is make certain that you understand the inches and out of your contract, that manner you will not be stunned when you get hit with extra fees.

Credit cards are a large financial responsibility, before you subscribe for one make up one's mind if it is really the right thing for you financially.

When you subscribe your credit card contract you probably presume that the interest rate quoted in this contract is the rate that you will always be paying. This is not the case. Credit card companies have got the right to up your interest rate. Knowing how and why can salvage you a batch of emphasis in the long run.

7 Consumer Credit Laws You Should Know if You are Trying to Repair Your Credit

There are seven consumer credit laws you should be aware when dealing with your credit.

1. The Truth in Lending Act

The client had to be told the true cost of borrowing, so they could calculate out exactly what the charges would be. You must be informed, in authorship of the finance charge and the APR before you subscribe any contract. Also, you need to be informed of the method they are going to utilize to cipher the balance on which you pay a finance charge.

This Act gives you a opportunity to change your head when you utilize your home as security in a transaction. The first 3 twenty-four hours right of recission gives you 3 business years to call off the transaction and the creditor must give you this notice prior to the transaction.

2. The Carnival Credit Reporting Act

Check other fillip stuff for your rights. Basically this enactment modulates the activities of credit reporting agencies or credit bureaus and gives the FTC duty for enforcement.

3. The Carnival Credit Charge Act

This law set ups processes requiring creditors to promptly rectify charge errors, and allows the consumer to keep back payment on damage goods, and do creditors promptly credit your payments.

4. The Carnival Debt Collection Practices Act

This enactment set ups the guidelines for aggregators to follow. They may not reach you at unreasonable modern times or places. Unless agree, they must not reach you before 8 am or after 9 pm, nor at your topographic point of employment. You must have a written account of your supposed debt and what to make if you experience you make not owe the money.

5. The Peer Credit Opportunity Act

This Law forbids favoritism in the granting of credit of any word form owed to sex, matrimonial status, race, faith or age.

6. The Electronic Funds Transfer Act

This enactment gives protection in all stages of modern banking techniques such as ATM, telephone transfers, computing machine transactions, etc. Its bounds for the first clip consumers’ liability for lost or unauthorised usage of debit entry or electronic cards are similar to those in topographic point for credit cards.

Notifying the bank within 2 days, your upper limit liability is $50. If you lose that timeframe, you could be apt up to $500 in charges. After 60 days, you’ll be apt for the full amount.

7. The Credit Repair Organization Act

This law states that the credit repair organisations could not do a statement that was misleading. They were prohibited from advising their clients to do a misleading or wrong statement to a credit bureau.

This law gives the consumer 3 twenty-four hours right of cancellation, which needs to be on the contract and must direct you on how to cancel. The written document must item the services that volition be provided, guarantees, clip framework for service and cost for the consumer.

Copyright © 2005 ExcellentCreditNow.com - All Rights Reserved

Have You Checked Your Permanent Record Lately?

As a immature student I feared getting bad classes because I didn’t desire any bad Marks on my “permanent record.” Get an “F” inch fifth-grade scientific discipline and it travels in your record. Act up in Mrs. Brown’s class? Yep, it’s inch your record too. Get caught using a curse word and it’s not only in your lasting record but it travels right at the top! When you travel to a parochial school like I did, you come up to believe that there really is some cryptic data file that follows you for the remainder of your life.

Want to cognize a secret? There really IS a lasting data file that follows you through life, but it have nil to make with grammar school classes or activities. The existent “permanent record” you need to be concerned about as an grownup is your credit record! You should check your credit record on a regular basis, especially if you are planning on making a major purchase such as as a car or home.

Your credit report or credit profile is a record of your credit activities. It names your credit card accounts and loans, your account balances, and whether or not you do your payments on time. Your credit report is used by possible lenders to measure your creditworthiness. Credit reports have got also been used by insurance companies to determine what rates you will pay for your insurance policies.

Reviewing your credit report can assist you avoid costly errors. In one recent study, more than than 50% of the credit reports checked contained errors. Other surveys have got shown similar consequences with as high as a 70% mistake rate. The most common mistake happens when the information of another person, with a similar name or account number, is recorded in your credit profile.

A more than serious problem happens when person additions access to your personal information and perpetrates identity theft. Identity theft have go the fastest growth law-breaking in our nation. Identity theft ailments jumped 75% from last twelvemonth according to a recent Federal Soldier Trade Committee report. The pecuniary loss from identity theft law-breakings skyrocketed to a concerted $53 billion in 2002! Accounts that look on your credit report that weren’t opened by you could be a mark of identity theft.

For a thorough reappraisal of your credit profile, you need to check with all three major credit reporting agencies (CRA’s) : Equifax, Experian, and TransUnion. Information can change between the three CRA’s and it’s of import to do certain each have got accurate and up-to-date information regarding your credit history.

Once you have your credit report, start by checking the truth of your personal information: your name, your societal security number, address(es), etc.

Next , analyze the accounts listed in your credit history. This subdivision listings your accounts with creditors and your payment history with them. It is of import to read this full subdivision and do certain the information is complete and have been reported correctly. Report any mistakes immediately to the credit reporting agency for probe and correction.

Finally, check the number and frequence of credit enquiries to your file. Brand certain that all the enquiries were authorized by you. Potential creditors who see a high number of enquiries in a short clip period of time may see you a high hazard and deny you credit.

Make it a wont to check your credit report annually. Doing so can salvage you time, money and future credit problems down the line.

Comprehending a Credit Report

Obtaining a credit report is an excellent way to begin taking control of your financial future. It's recommended that you review your credit report once a year, not only to be aware of your standing with creditors but to also keep abreast of errors and fraud. However, once your report arrives you may have trouble making sense of it. How are you to read and understand a credit report?

There are three major credit reporting agencies that issue credit bureau reports; Experian, TransUnion and Equifax. It is recommended that you obtain reports from all 3 credit report agencies as they most likely contain varying information since creditors subscribe to agencies on a purely voluntary basis. The credit reports provided by each of the different bureaus may present somewhat differently but generally speaking the information will be broken down in much the same way.

There are four main parts to the credit report: personal profile, credit history, public records and inquires. Check each section carefully for any errors. Note any errors you may discover on a separate piece of paper as you read over your report.

Personal Profile

At the top of the credit report you will find all your basic information such as your full name, current and previous addresses and employers, social security number, and date of birth. Your spouse's name may also appear if applicable. In addition, you may notice several variations of your name listed. This can occur when creditors record the information incorrectly. These discrepancies are usually left on your credit report. It is important however, to ensure that your address is correct. An incorrect address could alert you to a possible identity theft.

Credit History

The next section is your credit history. This provides you with an itemized list of your current active, past closed accounts and their balances or arrears. Listed first is the name of the creditor and your account number for each bill--sometimes the account numbers may appear partially obscured for security purposes. These debts could include real estate mortgages, credit cards, car loans, or medical bills.

There will be a column for identifying the nature of the account; Joint, Individual, Undesignated, Authorized User, Terminated, Maker, Co-signer or Shared. There will also be a notation of the date when the account was opened, number of months the account payment history has been reported and date of last activity. The report will show your high credit limit or the maximum you are allowed to borrow, if applicable. There is a column for Terms which indicates the number of instalments or monthly payments remaining on the account.

The next few columns will show the balance remaining on the account, any past due amounts and the status of the accounts. There are two types of accounts; instalment and revolving. An Instalment account means that there are fixed payments and a specific ending date, such as with a car loan. A revolving account is one with no fixed ending date as with credit card debts. Creditors like to see few revolving debts.

The credit report will indicate the different types of accounts and also may assign it a numerical ratings system. You may see such symbols as R1, R2, R3 or I1, I2, I3.The R or I indicates Revolving or Instalment and the numbers indicate the payment history of the account as follows;

0- account hasn't been used yet

1- paid as agreed

2- 30 plus days past due

3- 60 plus days past due

4- 90 plus days past due

5- 120 plus days past due

7- Collection account or bankruptcy

8- Repossession or foreclosure

9- Charged off or bad debt

The credit report will also show a record of any debts that have been turned over to a collection agency. It will show the date the collection was reported, the name of the company handling the collections and the company or lender that the loan was originally issued with and the balance remaining on the account.

Public Records

These are reports obtained from local, state and federal courts. They will indicate records of bankruptcies, tax liens and monetary judgments. Overdue child support records may also be shown. These public records will remain part of your credit history for seven to ten years and reflect negatively on your total credit score.

Inquiry Section

This section reveals any parties that have obtained a copy of your credit report over the last two years. There are generally two types of inquires, hard and soft. A hard inquiry is one initiated by you, whenever you apply for a loan or fill out a credit application. A soft inquiry comes in three forms; companies that wish to offer you promotional applications for credit, current creditors that are monitoring your account or credit bureau inquires requested by you, the consumer. These soft inquires do not show up on credit reports that businesses receive, only on copies provided to you. Although many lenders will view too many inquiries on your report as negative, it is important to note that two or more 'hard' inquires within a 14 day period count as just one inquiry.

Credit Score

The credit report can also reveal your credit score. A credit rating scores is a means of calculating an individual's credit risk to determine how likely they would be to make good on a loan. The score is a three digit number ranging between 300 and 850. The higher your score, the better it reflects on you as a borrower. A good credit rating score will enable you to negotiate for better interest rates.

Disputes

What if you should find an error on your credit report? Once you have discovered an error, contact the credit bureau that issued the credit report and state in writing what you found to be inaccurate. You will find the contact information listed at the top of your credit report.

The credit reporting companies must reinvestigate the claim within 30 days. They will then contact the party that submitted the item and attempt to resolve the dispute as quickly as possible. Remember, you have the right under the Fair Credit Reporting Act to dispute any inaccurate or fraudulent information that may appear on your credit report, and should do so in a timely fashion.

Once you learn to read and understand a credit report, you are moving towards a more secure financial future. Obtain your report today!

Home Inspections or Home Warranty?

Homebuyers are a funny lot. They routinely inquire thought-provoking questions. A common inquiry is, "If I get a home inspection, should I still get a home warranty?" Then there's always this question, "If I get a home warranty, make I still need a home inspection?"

The pick between having a home review and buying a home guarantee is a inquiry that I frankly make not understand. Each is intended to function a separate intent and ideally work together to protect and reduce the hazard of homeownership.

Maybe an analogy will do the matter clear. An individual have just had a complete and through physical exam. The consequences of the examination and all connected laboratory diagnostic tests are that the individual appears to free of all disease or illness. They are presently the image of health!

Would it be prudent or responsible for the physician then to urge to the patient, owed to their mulct physical condition, that it is a waste material of money to go on to pay for wellness insurance? Of course of study not!

None among us would see the physician even sane, allow alone responsible to do such as a recommendation. But, is that not the same state of affairs to person feeling that they need not purchase a home guarantee because they just had a home inspection?

And let's see this same scenario from the antonym direction. Would we anticipate that our life insurance carrier would urge to us that we forego the disbursal of regular physical exams, because, after all, we now have got life insurance! Insanity!

The life insurance companies, in fact, experience so strongly that a physical examination is such as an of import portion of hazard reduction that a physical examination is often required to secure a life insurance policy, or at least have got got an consequence on the insurance rate.

If insurance companies desire to have you "inspected" prior to assuming the hazard of your passing, it certainly do sense for the homebuyer to have the home inspected prior to purchase. Doesn't it, therefore, do similar sense to justify unanticipated failure with the home warranty?

When buyers fully understand hazard and the cost-effectiveness of hazard reduction tools, they almost always desire all of the hazard reduction tools available. It is in everyone's best interest to reduce hazard by every cost effectual agency possible. Buyers love to be educated about apprehension and reducing risk, and everyone loves a happy homebuyer!

Copyright © Florida HomePro, Inc. and Sir William Wallace J. Conway. All rights in all mass media reserved.

The Folly of PEG Ratio

Price Earning Growth (PEG) Ratio is the ratio of a company's P/E with its growing rate. A batch of analysts have got concurred that a stock is fairly valued when its peg ratio equal one. This agency that if a stock have got a P/E of 10 with a growing rate of 10%, then the stock is trading at just value.

How many of you have seen this sort of statement? I have got seen it plenty of modern times and I believe it is silly. This is a relatively simple reasoning. Let's think of it for a second. If a stock will turn its earning for 8%, then to attain just value, the stock have to merchandise at a P/E of 8. How about a stock with growing rate of 5%? Its just value is a P/E Of 5. How about a company with 0% growth? Oh, right. According to this theory, the company should have got a P/E of 0, or worthless. Bashes this brand sense? Heck, no. But there are a batch of articles regarding this peg theory. Here are respective beginnings of commonly misunderstood peg ratio:

http://www.moneychimp.com/glossary/peg_ratio.htm http://www.fool.com/School/TheFoolRatio.htm http://www.investopedia.com/articles/analyst/043002.asp

For a 0% growing company, the just P/E ratio for the company is not 0. Rather, it is a few percentage above risk-free interest rate or a 10 twelvemonth exchequer bond. If a 10 twelvemonth chemical bond is yielding 4.6%, then the just value of a common stock is at 7.6% yield. Inverting this yield, we get a P/E ratio of 13.2.

Anything else is incorrect with using peg ratio to determine the just value of a common stock? peg presumes infinite growing rate in earning per share. No company can turn at the same rate forever. If we presume company A volition turn at 10% rate for the adjacent five old age and then growing slows to 2% indefinitely, what is the just value of the common stock using peg ratio? The reply is it can't make that. peg ratio is manner too simple to single-handedly delegate a just value for a common stock. It is misleading and simply incorrect to utilize peg ratio for our just value calculation.

Common sense orders that a stock with higher growing rate should be valued at a higher P/E ratio. There is nil incorrect with that. But using a simple peg ratio of one as a just value of a common stock is simply wrong. I don't have got an accurate manner to cipher this but an estimate can be read on other articles entitled Calculating Carnival Value with Growth and Carnival Value with Negative Growth.

The Allure of Dividend

Investors wanting to pick undervalued pillory need to look closely at dividend. For one thing, dividend driblets money straight into your pocket. Your stock terms do not have got to lift to make profits. Another thing is that lone company that have got extra cash will give dividends. This necessitates them to be highly profitable. Investing in profitable companies will engender success if investors purchase them at the right price. Finally, once initiated, management will struggle its best not to get rid of its dividend. Lawsuit in point was Schering Big Dipper Corp. (SGP). It spotted $ 0.22 dividend per share while it hasn't been profitable in 2003.

One concluding allurement is the possibility of capital appreciation. A batch of times, companies with a high dividend yield, have a lower evaluation than others. For example, some companies are offering a dividend output as high as 6%, which is higher than the output of exchequer bond. One such as company is Flagstar Bancorp (FBC) with 6.1% dividend yield. The common stock gives $ 1 in dividend, while its earning per share is predicted to be $ 1.70 in 2005. Earning was as high as $ 4.00 per share in 2003. Assume that FBC can earn $ 1.70 per share forever, then its share terms can lift to above current terms of $ 16.50.

Having said that, investors should be careful of dividend trap. Some companies may cut future dividend owed to deteriorating status of their financials. That is why it is extremely important to foretell the just value of the common stock before investment in them. Dividend is just portion of the equation. Lawsuit in point was the former astatine & Deoxythymidine Monophosphate Corp. (formerly traded with symbol T). It used to be valued north of $ 100 Billion and was giving out nice dividend. Now, it have fallen to less than $ 20 Billion, while the dividend too have been cut.

Here are respective dividend remunerators that mightiness spike your interest:

SBC, Bellsouth and Verizon Communications. They are all in the telecommunication sectors and offer dividend output of 4.4 to 5.4%. Stock terms have been going nowhere for the past twelvemonth owed to investor incredulity of rivals undermining their laterality in the telecommunication market.

Pfizer, Bristol Myers Squibb and Merck. The pharmaceutical sector have been battered in recent years. Merck's legal problem with Rofecoxib also makes negative sentiment towards the sector. These three companies have got got a dividend output of between 3 to 5.6%.

Bank of America, Citicorp and American Capital Mutual. The banking sectors have been known to give generous dividends. Currently, they are all have got a dividend output of between 3.90% and 4.8%. But with the federal modesty still in tightening mode, I experience that bank pillory can be bought at an even cheaper terms sometime in the future.

How to Use Annual Report

There are many stairway in calculating the just value of a company. However, before we even make that, it is imperative to cognize how a company earns its profit. Bashes it make that by merchandising to consumers? licensing its engineering to other companies? or extracting natural resources from the ground?

The reasonable manner to make it is by reading the company's annual report. What is an annual report? Annual report is annual publication by public companies to break inform investor about the company's line of business. Annual report gives investors a glimpse of the company's line of business, financial wellness as well as management's strategies for doing business.

Let's expression at CNET Networks Inc. The company trades in the NASDAQ market with symbol: CNET. What makes CNET do? I cognize CNET have cnet.com. But make you cognize that it also have download.com, MP3.com, ZDnet.com and News.com ? How make I cognize that? Yep, you think it. CNET's Annual Report will gives you all that.

From CNET's annual report, we can make a small excavation for CNET's internet traffic. As of August 27th 2005, these websites of CNET attracts 3 % of all internet traffic. Pretty impressive, considering that Google throws 23% of all internet traffic. On April 2005, Google had 78.6 million alone visitors. By comparing this metric, we might have got an thought CNET's gross potentiality for the calendar month of August. I will not travel into that but this shows how utile reading CNET's annual report is. Reading an annual report functions as the first measure towards investment in a peculiar company.

How make we obtain annual report? There are respective beginnings for this. First is the companies ain website. You are interested in knowing more than about CNET Networks? You can get the annual report by going to http://www.cnet.com and travel to its shareholder relation. After respective clicks, you can then download the annual report.

Or ... you can travel to some websites that offer complete annual report for a number of different companies in alphabetical order. Our website is one of them. Admittedly, while having 100s of annual reports in one topographic point is convenient, it is not as thorough as what the company's ain website have to say.

Having A Goal In Investing

Having a end is critical to your investment career. Goal gives you directions. It will also put your head to attain that goal. So, before putting any money into stocks, the first inquiry you should inquire is what make you desire to accomplish with stock investing?

For most investors, the end is not to be charitable. Charitable have its topographic point and time. They desire to earn tax return on their investment. So, how much money make you desire to have got at retirement age? Let's presume that we all privation to retire by the clip we are 65. How many more than old age before retirement age? Twenty? Twenty five? How much nest egg make you have got right now? All these factors will change your investing strategy.

Let's see respective scenarios. The first scenario is a 40 twelvemonth old investor. He have got nil in his portfolio and his end is to have $ 1 Million by the clip he retires. As of right now, he can put about $ 300 per month. That is a good end but is it achievable? Well, let's see. If he can fit the stock index tax return of 10.5% annually, his nest egg would have got grown to $ 381,787 by the clip he is 65. Obviously, he fall short of his goal. If he can't salvage more than than $ 300 a month, the lone manner he is going to get $ 1 Million is to have got his investing turn by 17% twelvemonth in and twelvemonth out.

For this gentleman, his end is to accomplish 17% tax return on investment. Obviously, investing in index monetary monetary fund will not do because historically, index fund will only give you a tax return of 10.5%. Having this end do him more than focused in his investment career. Instead of thought that he can attain $ 1 Million by investing in index fund, he now have to happen other ways to hike his investment tax return to 17% annually.

The second scenario is a 40 twelvemonth old investor who had amassed $ 100,000 in nest egg that he had accumulated since his workings days. His end is to have got a $ 1 Million by the clip he retires too. He would have got an easier clip than a second gentleman. Our computation shows that he can attain that end without even having to add a penny more to his savings. Furthermore, his investing makes not have got to earn 17% annually. He can still attain his end by investing in index monetary fund which historically have returned 10.5%.

There is nil incorrect with having an investment goal. Goal assists you to focus. While having a end will not automatically hike your investing return, investors with a end will happen a manner to hike their investing return. Finally, investors should put a realistic end too. Expecting a 50 % annual tax tax return on your investment might not be accomplishable if you just begin investing or if your past return had been less than 10%.