You’ve already upgraded your home with the latest and greatest gadgets out there. Why not do the same with your investment portfolio? You’ll find plenty of stocks in the tech sector that can give your portfolio a serious near-term boost. While you want to maximize investment returns with lower-risk long-term investment choices, you can complement the investments you make for the long haul with stocks that have the potential to enjoy a big (and relatively quick) price increase. You’ll typically hold short-term stocks for just a few years, often much less, before selling and making a profit.
The 2020 market has experienced extreme volatility, but tech stocks have come out as winners overall, making them great choices for savvy investors. Read on for some of the best short-term stocks in the tech sector to invest in today.
We’ve discussed before whether or not your house is an asset or a liability in other articles, but now we are looking at whether your car is an asset or liability as well. Your car is on your net worth statement, right? So, it must be an asset. But just like with a house, it depends on what your definition of an asset is. Your car is typically a large purchase. It can cost thousands, and sometimes tens of thousands of dollars. Most people typically consider cars an asset because you can sell it without losing money.
Because you can sell your car for a decent amount, it’s usually considered an asset. Banks will consider your car an asset when they are assessing whether or not they will give you a car loan. This is why your application will ask whether you have a car, and how much your car is worth. However, not everything that you can sell is an asset.
The General Definition of an Asset
As we’ve discussed before, the definition of an asset is something that has value, or that aids the owner of the asset in making money. We’re not looking at whether or not the thing is an expense. A car is an expense, but many assets also come with expenses.
“A resource with economic value that an individual, corporation or country owns or controls with the expectation that it will provide future benefit.”
“Assets are bought to increase the value of a firm or benefit the firm’s operations. You can think of an asset as something that can generate cash flow, regardless of whether it’s a company’s manufacturing equipment or an individual’s rental apartment.”
The defining difference between something that is an asset rather than a liability then is whether or not it will provide benefit. Furthermore, it is a question of whether or not that particular thing increases the person (firm’s) value and generates cash.
With that in mind..
Is Your Car an Asset, or a Liability?
It sounds like your car isn’t an asset. By definition, your home isn’t an asset (not your primary living space) because you live in it. It doesn’t make you money, and it doesn’t add value to you (you need somewhere to live whether or not you are renting or you own).
Does your car make you money? Well, it gets you to and from work. That helps you make money. But you could use public transportation for the same purpose.
Unless you are a pizza delivery driver, Uber driver, driving school instructor, or any other profession that is based in a vehicle, a vehicle is not usually tied directly to your ability to make money. Even if you are one of these things, your primary car is likely not an asset; you usually would use a different vehicle for work purposes.
Sure, your car adds value. It saves you time, lets you drop your kids off at school and sports, and provides you with a sense of safety. However, with insurance, fuel, maintenance, mileage, and all of the other costs that accompany car ownership, the costs almost always outweigh the monetary value of a car.
Many consider a car a depreciating asset, because this is how it shows on company balance sheets. For companies, however, vehicles can be an asset (however depreciating they may be.) For individuals, they can be more of a liability than an asset.
Protect and Build Your Assets
Taking stock of all your assets is an important step in determining your net worth and planning for the future. Once you identify all your assets, you can better protect yourself from natural disasters, divorce, or other unforeseen misfortunes. Some people choose to leverage various assets to ensure they have enough cash on hand in case of emergencies. But first you must inventory all cash, tangible and intangible assets, liquid and fixed assets, fixed-income assets and equity in your name.
Incidentally, if you are interested in learning the basics about how to accumulate assets, I recommend that you pick up a copy of Robert Kiyosaki’s Rich Dad Poor Dad. The book has sold millions of copies, so it is insanely popular.
For more on assets, and how to create some of your own, check out these great articles.
You’ve got a vision for a business that you believe could be a success. Unfortunately, your minimal experience, non-existent network, and limited budget make it nearly impossible to accomplish your goals. Taking out a loan is an option, but getting approved with a mediocre income source, low credit rating, and no collateral is an uphill battle. Short of giving up on the idea altogether, you’re desperate to find an alternate solution.
Turn to Investment Firms
Though it may seem like all hope is lost, many entrepreneurs gain the financial resources they need to launch their businesses by working with investors. These are individuals or companies like The Chernin Group (TCG), that provide capital, motivation, support, and resources to business owners. Depending on your agreement’s terms, you can receive assistance with various phases of your business development and growth.
Pitching Your Idea
While working with an investment firm could be ideal for getting your startup on the road to success, not everyone who wants to start a business is eligible. Securing a contract with the best investors will ultimately require you to show them why you’re the best candidate. As coming up with a pitch is challenging your first time around, here are some suggestions to knock it out of the park.
Select the Right Investors
Before planning your pitch, you must find the appropriate audience. There’s no need to persuade someone interested in tech to invest in your fashion design business. Interests aren’t the only factors to consider when choosing an investor.
Think about your needs as a founder. Do you simply need a few thousand bucks to get started, or do you need assistance with market research, management, human resources, operations, and expansion? The idea is to find an individual or firm that can help fill the gaps to increase your chances of success.
Identify a Problem and Solution
The best businesses are those that can solve a common problem for the general public. As you assess your products and services, what issue do they help to resolve? For example, if you’ve developed an application that allows monitor internet usage, it could be a useful tool for parents.
Parents who are often bombarded with busy schedules don’t have the time to keep up with what their children are exposed to. Therefore, the application would allow them to stay in the know and protect their teens more effectively. Adding this information to your pitch shows potential investors a need for what you’re offering.
Business Models, Projections, and Accomplishments
Remember, the idea is to show investors that their contributions will generate a significant return. When creating your pitch, don’t forget to include models, projections, and any accomplishments you’ve made thus far in sales. How do you plan to make money? How will you distribute your products and services to your target market? What, if anything, have you accomplished so far? (i.e., how much have you earned in the last year, do you have any sponsors, or have you successfully gotten your products on the shelves of local stores?)
Make it Entertaining
You want your investors to know that you mean business, but a long, drawn-out, and boring pitch won’t get you the support you need. You must find ways to make your pitch engaging and entertaining for your audience. You can include demonstrations, offer product or service samples, share a personal story, or tie your pitch into your audience’s unique interests.
Launching and sustaining a successful business is no easy feat. It requires a great deal of time, money, and resources. If you’ve put off your vision due to a tight budget, limited experience, or few resources, a business investor could give you the boost you need. Once you’ve narrowed down your list of investors, use the tips mentioned above to put together a pitch that will convince them to back your dream from start to finish.