Three Profitable Offshore Opportunities - Banking, Forex, And a Foundation
The world is changing and it is changing fast. Who would have thought that small Asian economies would be leading the way out of the worst recession in seventy-five years? Who would have thought that a country like Peru would be buying dollars to alter the exchange rate and help prop up the dollar? It is a brand new world where perhaps the best place to set up a banking operation is in New Zealand although an NZOFC cannot be called a bank! Still, a tried and true solution to offshore asset management such as a Panama Private Interest Foundation remains as a profitable and secure offshore solution along with offshore banking, and opening a Forex company.
More and more people are moving their assets, their talents, and themselves out of their nations of origin and into a busy, industrious, and profitable offshore world. The very wealthy have banked in tax advantaged jurisdictions for years. They have taken still take advantage of offshore asset protection and privacy vehicles such as trusts, international corporations, and foundations to shield their wealth from prying eyes and reduce the tax consequence of inheritance. However, it is the surge of expatriates from all over the globe moving and doing business all over the globe that opens the doors to profitable offshore investment opportunities.
Three profitable offshore opportunities are starting a bank, forming an offshore Forex company, and using a Panama Private Interest Foundation as a holder of tangible assets, businesses, and bank accounts. There are many opportunities in today's fast moving world. We choose these three for their combination of opportunity and security.
Offshore Banking in the 21st Century: an NZOFC
There are many offshore banking jurisdictions. There are also a number of jurisdictions where an individual or corporation can obtain licensing and set up business offering banking services. In choosing a jurisdiction for offering offshore banking services the individual or corporation will want to search out a democratic, politically and economically stable, business friendly country. A nation where English, still the universal language, is spoken is a plus. The nation will need to have at least adequate infrastructure to support the business and ideally will have first rate telecommunications, transportation, and support services.
A nation that offers a first rate offshore banking opportunity and also fits the necessary criteria for a successful offshore operation is New Zealand. This former British Crown Colony is located in the Southwest Pacific to the East of Australia. Its population is mostly descended from British immigrants and is mostly English speaking. The country is well governed with little or no corruption and its educational standards are as good as or better than the USA, Canada, and Great Britain. This is a business friendly country known for its innovative spirit.
Of our three profitable offshore opportunities we put the New Zealand Offshore Financial Company (NZOFC) at the top of the list. This type of company is not governed by New Zealand banking law nor regulated by the Federal Reserve Bank of New Zealand. There are no capital reserve requirements in setting up an NZOFC. The law in New Zealand is quite specific in that an NZOFC cannot be called a bank or intimated to be a bank. However, such a company can take deposits from anywhere in the world outside of New Zealand. It can pay interests, make loans, market investments, manage trusts, and provide virtually all services that a bank might offer. Anyone from any country is free to apply for a license to operate an NZOFC.
A Profitable Foreign Exchange Opportunity
So, the Chinese are trading the Yuan versus the Malaysian Ringgit. The Euro is periodically in free fall as Greece and the other PIIGS reveal more sovereign debt. A flight to quality sends folks out buying Yen, US dollars, and Swiss francs. So, how do you trade foreign exchange in this hectic and uncertain world of international finance? There is certainly money to be made in Forex trading. There is, however, steady money to be made in running a Forex brokerage offshore.
There are a number of jurisdictions still where it is possible to obtain a Forex license. Because of the variable degrees of infrastructure development, business friendliness, and political stability in some offshore jurisdictions it is wise to consult someone with experience to help choose a jurisdiction, obtain licensure, and initiate operations. There are a number good places from which to do business, depending up individual preference. There are also a few disadvantageous jurisdictions to be avoided. Starting out with good advice in this arena is wise.
The point of setting of a Forex company is that the fees and commissions are steady income. While trading can be profitable it can also be a drain on capital. This is the old argument about selling picks and shovels when everyone else is prospecting for gold.
Handling Offshore Opportunity in the Most Advantageous Manner
The third offshore opportunity we mention is the Panama Private Interest Foundation. This is not directly a business opportunity but it can be a "holder" of businesses, bank accounts, and assets such as art work, yachts, airplanes, jewelry, and more. A Panama Private Interest Foundation has no owner. It does have beneficiaries. Such an entity is often used in place of a trust to pass on inheritance with minimal tax consequences. The foundation is set up in such a way and with instructions so that beneficiaries change when the first beneficiary dies. Especially for those with concerns about asset privacy and security this type of foundation will allow for individuals to benefit from assets, businesses, and bank accounts without having their personal names or other details in any public registry.
A common use of a Panama Private Interest Foundation is in an integrated offshore asset protection solution containing offshore businesses, bank accounts, and other assets. Typically the foundation is the lynch pin in this solution as the holder of assets for the use and benefit of designated persons, the beneficiaries.
These three profitable offshore opportunities are available to anyone interested in pursuing them. It only takes an email or phone call to an experienced individual or company to get the ball roll
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Planning for Trading Success
The three T's to becoming a speculator: trading plan, trade worksheet, and trading journal. Without a doubt, if you want to develop trading into an avocation or you want to improve your demo trading, or you wish to trade for a living, you cannot ignore either of these three tools. This particularly goes for your demo-, paper-, or test-trading account. Utilizing these three tools effectively makes your day-to-day trading go a lot smoother.
First Tool: The Trading Plan
You want to ask yourself as many questions as possible when developing a trading plan. Here are five quick questions to begin your trading plan.
The first question you have to ask yourself is: What markets do I want to trade?
How you answer this question will ultimately determine your longevity in trading. There are many factors that determine which markets are best suited for you. Do you want to trade very volatile markets or low-volatility markets? Do you live on the West Coast where it's difficult to see the 5AM opening bell for some markets? Do you travel a lot and you can't stare at your screen all day long? The market or markets you pick to trade should best suit your lifestyle.
It is also best to pick only two to three markets that you sincerely want to trade. It is difficult to understand and trade the subtleties of every single market available. While technical analysis can be applied across the board, as a specialist, you begin to understand what actually makes a particular market tick. You can then manage your money and your trades according to the rhythms in that market. By focusing on a handful of markets, you can become a specialist. Without a doubt specialist in any field tend to fare better.
The second question you have to ask yourself is: What am I trading for?
Knowing why you are trading stocks, futures, forex, and options is imperative. Is it for fun, like a gambler, or is it a true desire to speculate? Or are you trying to "hedge" your overall investment portfolio? What many investors forget about trading markets like futures and forex is that there are two aspects to it. It can be both the riskiest investment and the least risky investment at the same time, if you use it properly.
For example, during the dot-com bubble, many investors had mutual funds and stocks that closely matched the Nasdaq 100. When the market began to slow down and investors found themselves in the precarious position of not knowing if they should liquidate their tech stock and investment portfolios, they could have simply used Nasdaq futures to protect themselves from any quick drops in value.
By looking at futures from both sides, speculating and hedging, you can come up with more versatile strategies of managing your money over the long haul.
This leads us to questions three through five: What am I hedging against/for?, How many contracts would it take to accurately hedge part of my portfolio?, and How many contracts would it take to accurately hedge my entire entire portfolio?
These questions are designed to get you to think outside the box as a trader. Look at how your current investments are linked to interest rate fluctuations, the S&P 500, or the Dow Jones Industrial Average. Calculate how much you stand to lose when these markets move against you, and from there you can figure out how best to hedge yourself. None of these markets operate in a vacuum; there are ways for you to protect yourself from stock market adversity if you open your eyes to the hedging side of futures and forex investing.
Second Tool The Trade Worksheet:
The trade worksheet is designed to break down the numbers of any trade you are planning to execute before you enter it. It is designed to ask some fundamental questions. Once these questions are answered, you can see in black and white what the potential profit is, what the potential loss is, and if the trade is worth taking at all.
The vital information that it gathers is:
1. Entry price
2. Profit exit price
3. Loss exit price
4. Margin level
5. +/-% return on margin
6. +/-% return on account
7. Cost of option
A notebook that you can write in on a consistent basis will suffice. The goal is to get you used to doing the numbers.Keep track of the trades you entered and exited throughout the day. Tally up your profits and losses and how much you risked attaining your results. The information just may be the food for thought you need to help you make better choices during your trading experience.
Third Tool The Trading Journal
It's been said that you don't know where you are going unless you know where you have been. The trading journal does just that. Throughout your trading career, you will have multiple journals. In fact, you should do your best to never stop journaling when you are a trader.
If you cannot, a great alternative is to journal in 20-day trading cycles at a time. By journaling your trades, you will be able to understand why you do the things you do and when you do them. If they are good habits, keep them; if they are bad habits, do your best to modify them to help you succeed.
The typical trading journal should have the following:
1. A copy of your trading plan, so you can constantly refer back to it.
2. At least 20 trade worksheet forms, complete one for every trade you execute.
3. A copy of the entry chart of every trade you execute, a long with a small three- to five-sentence synopsis on why and how you entered the trade, including your feelings and emotions at the time.
4. A copy of the exit chart of every trade you execute, along with a small three- to five-sentence synopsis of the profits or losses and why and how you exited the trade, along with your feelings and emotions at the time.
By consistently documenting your experiences, you will become an expert at knowing how fear and greed wreak havoc on your decision-making process.
Building confidence isn't easy when it comes to perfecting how you speculate in the markets. They say that in order for a new activity to become a habit, you have to do it 30 times consistently. Trading is no different. Avoiding the top 10 mistakes of trading, putting together a trading plan, working with a trade worksheet, and utilizing a journal are all activities that have to be done consistently in order to build confidence. While your confidence boost won't happen overnight, one day you will wake up and find yourself skilled and confident.
