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While the conversion option is bidding for the bonds by exchanging debt value into obligations into shares. With this option, investors who had become the lender, after the due date will be shifted to the owners of capital in the companies that issued convertible bonds.

According Yunianto Handy, an analyst with PT Mandiri Securities bonds, each of the above classification has a level of risk varies. Therefore, trading characteristics of each type of bond was to be different too.

“The price of bonds that are formed in the secondary market will follow the level of risk and expectations YTM respectively. For, as the closer when due, then the rate of return and risk of each bond product will vary. This is affecting price, “he said at the Independent Club last week.

In bonds in the secondary market transactions, price calculation used is totally different from the calculations in stock trading. Prices used were measured in percentages, not the rupiah denomination.

At the time bonds are issued, then the bond price will be at a level of 100% or commonly known as Par prices. YTM rate when issued was equivalent to the coupon interest rate offered.

As an illustration, a company issuing bonds worth Rp 1 billion 5-year term with a coupon rate of 7.5% per annum and is payable every 6 months.

At the time of publication, the price of these bonds are priced with a YTM of 7.5% Par. That means, if the bond holders decide not to sell these bonds to maturity, the bondholders will receive the funds by 100% (USD 1 billion) at maturity plus accrued interest at 7.5% per year multiplied by 5 (USD 375 million) or a total of Rp 1.375 billion.

However, if an investor buys bonds in the secondary market in the second year, it means the rate of return that would be obtained were different. Because, he did not get the coupon payment before he bought the bonds.

Consequently, the purchase price of bonds in the secondary market was not likely he bought at a price of Par.

In simple terms it can be said that bond prices in the second year will be below the price of Par, call it 98%. Therefore, investors will pursue the difference in the level of return that is obtained by placing a buy position at a price below the price of Par.

The first step to getting out of debt is to understand the reasons why we have borrowed so much.

If you currently have a high level of indebtedness, I present below some of the reasons why you might be in debt, and that should work if you ever want to meet your goal to get out of debt.

Compulsive shopping

The first reason why you’re probably in debt is because you a “shopaholic.”

You like shopping and buy all the products that are fashionable without being aware of the spending you’re doing, and not caring that your financial situation because you’re not in a position to pay.

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One of the ways to improve our economic situation is to reduce our costs. And one way to reduce our costs is to avoid unnecessary expenses.

Let’s look at a list of 10 things that could be spent unnecessarily, and where should we care if we learn to spend less and improve our economy:

1. Subscriptions to newspapers and magazines

An unnecessary expense which could be making right now is spending on subscriptions to newspapers or magazines that do not always read and that we acquire only every time you want to. But also, why be spending money in print newspapers and magazines when you can read for free on its website on the Internet?

2. Bottled water

Water is a free resource and one of the most abundant on the planet. Do I need to be spending our money on bottled water when we drink water or drink boiled water from a faucet that has a filter?

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In our lives, we always need more and more protection. We need to protect our body from any diseases in order to stay health, we need to protect our family so they will stay safe, and even we need to protect ourselves from any danger that will arm our assets, finance, body parts, psychological condition and many more.  Let’s take one sample of what kind of protection that we need the most.

According to the result of the GDS International, more and more people in this world need to protect their selves from any scam and fraud cases. In their program the GDS International Scam, the company has found more and more facts related to this scam issues. The truth is that many people do not really know about the danger from Internet world that threats their selves, world, and live. The scam cases are proven to have harmed many people especially in finance condition, where the scammers often ask their victims to give their bank account number, their credit card and insurance number, and so forth; poor for these people when they have no doubt at all and give their confidential account to the scammers.

When you see other people’s experience, you need to conclude that somehow you have to protect and prevent yourself from any kind of scam and fraud cases. You use other people’s life experience as your best teacher and also your early protection and prevention, so that you will never get into the same thing that they have been through.

Many people ruin there wealth and many people earn lots of wealth from the market place. In this year of 2008 and 2009, market is full from risk. For getting secure services, there is no any alternative then good advice. If you are willing to save your wealth from risky market and you are willing to increase your money instead of decrement then LPL Financial is there for helping you always. They are providing one of the best schemes and plan. It means you can get good Financial Advisor Solutions.

LPL is having many financial experts those are having complete information of market. Therefore they are able to provide you Financial Advisor Solutions. Without complete information or knowledge if you invest money in market so it might be you will lose huge money. They are having 11,000 financial advisors with different latest tools and infrastructure. They will provide you complete solution of your investment.

Don’t worry about your goal now you are in correct hands. LPL will not ruin your money. They have provided best services in 2008. There clients always appreciate their Financial Advisor Solutions. They are also provide there services in very affordable prices. You can spend some in money for getting Financial Advisor Solutions instead of wasting money here and there. Hence, you are having best place for saving and increasing your money.

Once we have prepared the draft of our personal budget, we analyze in depth, and make adjustments or changes as necessary.

The first thing to do is look at the balance at the end of the budget, which is the amount resulting from the difference between total revenues and total budget expenditures, we must ensure that it is positive, and is an appropriate amount (it is recommended that corresponds to at least 10% of total revenues).

Should we not be adequate to evaluate whether we could generate more income, for example, by seeking higher sales in our business, or looking for new sources of income.

But above all, to evaluate whether we could reduce costs, eg by removing some items in our budget (for example, subscriptions to magazines that do not usually read), or reducing costs in some (paying more attention to those items where we are spending lot of money).

Diversification in terms of personal finance is an investment strategy of distributing the money in various investments, rather than concentrating it in one investment or one type of investment.

Diversification is a strategy widely recommended by experts because it is considered the most effective way to reduce or control risk when investing.

If an investor decides to focus all of their money in one investment, you run the risk that investment and get bad results get to lose some or all of their money.

In contrast, if you invest in a diversified way reduces or minimizes the risk as to lose their money, many of the investments acquired would have bad results at the same time.

Every investment involves risk always, usually, the more potential to provide an investment return, the greater the risk involved and, conversely, the less profitable offers, the lower your risk.

As the ideal time to diversify is to create a portfolio or investment portfolio that combines investments that offer high returns but also high risk (eg, business or shares), and investments that offer low profitability, but higher security (for example, term deposits or mutual funds).

The ratio of these two types of investments will be given by our profitability objectives, the risk that we will be willing to take, or the investment profile we have.

If, for example, we get a higher return, most of the investments that comprise our portfolio investments will be offering high returns, but also greater risk. If we have a low tolerance for risk, most of the investments that comprise our portfolio investments will be offering low returns, but less risk.

To better understand the financial concept and the usefulness of a personal balance, then see how to develop and take advantage of one in 5 steps:

1. Detail liabilities
Having detailed our assets, we will detail our liabilities and debts, and the value of each. Among the liabilities, we can mention:
* Credit cards: the balance to pay for our credit cards.
* Personal loans: the balance that is left to pay for personal loans we have acquired.
* Auto loans, the balance that is left to pay for auto loans that we purchased.
* Mortgage: the balance that is left to pay the mortgage we have acquired.

2. Calculate heritage
To understand the value of our heritage, we simply subtract the value of our total liabilities to total value of our assets.

3. Develop personal balance
Once we have the necessary information about our assets, liabilities and equity, we proceed to develop our personal balance (preferably in an Excel spreadsheet).

In the left column point out our assets, and in the right column our liabilities and equity. As a point we must note that the total assets must always equal the sum of total liabilities and equity.

4. Compare personal balances
Every so often, we develop a new personal balance either monthly, quarterly, every six months or every year (at least do it once a year), and compared with the previous balance, and thus to assess how it has changed our financial situation.

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The secret of wealth
Wealth is achieved by creating or acquiring assets that we generate passive income, ie income generated without you having to work actively.

Examples of assets that generate passive income are: actions that generate dividends, rental properties, businesses where we have to get involved personally to work, multilevel, copyrights, books, music or software, franchising fees, etc.

But to save enough money to allow us to create or acquire assets that we generate passive income, you may first need to generate earned income, ie income earned in the active job.

So to achieve financial freedom may at first be necessary to have a job that we generate enough revenue so that we can save enough money and then invest in the creation or acquisition of assets that we generate passive income.

Saving culture
Achieving financial freedom is not just about generating good income, but most of all, a matter of saving these revenues to good use then give them (acquire assets that we generate passive income).

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Compare prices
Another way to spend less is that before deciding to buy something, we take our time, and look several places where they sell the product to get the site where we can get the lowest price. If we buy a product, we should not buy immediately, but take our time and compare their prices well, something we could do, for example, on the Internet.

Negotiate a better price
Another way to spend less is to always negotiate a better price, which means no pressure or take advantage of another person, simply ask.

We must acquire the habit of always negotiate a better price (which could include seeking a better deal, better terms, or higher profits), even if it seems unlikely that we accept, we lose nothing to ask. No reason to be shy, or feel bad about negotiating a better price, if, for example, we are in a department store, just ask if a particular product will soon be in a promotion of settlement.

Buy used instead of new
Another way to spend less is used to buy certain products instead of buying new. This applies especially to cars. A car straight out of the agency, immediately loses 30% or more of their value, so a tip is to buy a car that has just been purchased by a third party, have it for a year, selling almost the same price we pay for him, and then repeat the process.

Avoid debt
The debts we have also reported interest and costs, so another way to spend less is to avoid taking on debt. This applies especially to credit cards, which should be used only in emergencies or to get us in trouble, and not charge them with clothing, food or entertainment. Should have used them for some reason, we should try to pay the same month that we did.

Being creative
Finally, another way to spend less is to be creative and find ways that allow us to achieve it. For example, if we are going to travel for a few days to a country, we could find a home exchange with someone who wants to come to ours.

Or, for example, if we spend less on our travels, we may choose to become travel agents or planning a group vacation, and get discounts and even free tickets.